Consumers and the Economy, Part I: Household Credit and Personal Saving
In the years since the bursting of the housing bubble, the personal saving rate has trended up from around 1% to around 6%, while the ratio of household debt to disposable income has dropped from 130%...
View ArticleConsumers and the Economy, Part II: Household Debt and the Weak U.S. Recovery
The U.S. economic recovery has been weak, especially in employment growth. A microeconomic analysis of U.S. counties shows that this weakness is closely related to elevated levels of household debt...
View ArticleEstimating the Macroeconomic Effects of the Fed's Asset Purchases
An analysis shows that the Federal Reserve's large-scale asset purchases have been effective at reducing the economic costs of the zero lower bound on interest rates. Model simulations indicate that,...
View ArticleDo Initial Claims Overstate Layoffs?
Initial claims for unemployment insurance averaged a stubbornly high 468,000 in the year ending December 2010, but have recently come down quickly. Many analysts interpret this as a sign that layoffs...
View ArticleWhat Is the New Normal Unemployment Rate?
Recent labor markets developments, including mismatches in the skills of workers and jobs, extended unemployment benefits, and very high rates of long-term joblessness, may be impeding the return to...
View ArticleCould We Have Learned from the Asian Financial Crisis of 1997-98?
Economists drew a number of lessons from the Asian financial crisis of 1997-98 for preventing such episodes or mitigating their effects. Some of those are similar to lessons drawn from the global...
View ArticleTIPS Liquidity, Breakeven Inflation, and Inflation Expectations
Estimating market expectations for inflation from the yield difference between nominal Treasury bonds and Treasury inflation-protected securities—a difference known as breakeven inflation—is...
View ArticleStress Testing and Bank Capital Supervision
Stress testing was a potent tool in the supervision of bank capital during the financial crisis. Stress tests can enhance supervision of bank capital by providing a more forward-looking and flexible...
View ArticleGauging the Impact of the Great Recession
The Great Recession of 2007–2009, coming on the heels of a spending binge fueled by a housing bubble, so far has resulted in over $7,300 in foregone consumption per person, or about $175 per person per...
View ArticleSecuritization and Small Business
Small businesses have relied considerably on securitized markets for credit. The recent financial crisis led to a virtual cessation of securitization of some of the loans used by small businesses, such...
View ArticleWhen Will Residential Construction Rebound?
Over the past several years, U.S. housing starts have dropped to around 400,000 units at an annualized rate, the lowest level in decades. A simple model of housing supply that takes into account...
View ArticleDoes Headline Inflation Converge to Core?
Recent surges in food and energy prices have pushed up headline inflation to levels well above its underlying trend. In contrast, core inflation, which excludes food and energy prices, has remained low...
View ArticleThe U.S. Content of "Made in China"
Goods and services from China accounted for only 2.7% of U.S. personal consumption expenditures in 2010, of which less than half reflected the actual costs of Chinese imports. The rest went to U.S....
View ArticleRecent Layoffs in a Fragile Labor Market
Rising layoff rates during the spring of 2011 highlight renewed labor market weakness. Although job cuts among state and local governments have accelerated over the past few years, most of the recent...
View ArticleUnconventional Monetary Policy: Lessons from the Past Three Years
Researchers have made great strides in improving our understanding of the effects of unconventional monetary policy. Although further study is needed, the evidence from the past few years demonstrates...
View ArticleRecent Trends in Small Business Lending
Although bank small business loan portfolios continue to shrink, there are hints of possible stabilization. Among smaller banks, small business lending that is not backed by commercial real estate...
View ArticleWhat's in Your Wallet? The Future of Cash
The payment landscape has changed dramatically in recent years as new technologies have been brought to market. Yet, the demand for U.S. currency—cold, hard cash—shows no sign of fading. An empirical...
View ArticleWhat Moves the Interest Rate Term Structure?
To understand the effects of news on bond markets, it is instructive to look beyond individual maturities and consider the entire term structure of interest rates. For example, unexpected changes in...
View ArticleFuture Recession Risks: An Update
In 2010, statistical experiments based on components of the Conference Board’s Leading Economic Index showed a significant possibility of a U.S. recession over a 24-month period. Since then, the...
View ArticleSignals from Unconventional Monetary Policy
Federal Reserve announcements of future purchases of longer-term bonds may affect asset prices by changing market expectations of the future supply of targeted securities. Such announcements may also...
View Article
