Friday, August 1, 2014


Bloomberg | Fed’s Plosser Says Low-Rate Pledge Not Needed as Growth Rebounds
Federal Reserve Bank of Philadelphia President Charles Plosser said he voted against this week’s policy statement because its low-rate pledge is no longer appropriate after the economy “improved significantly,” while inflation and unemployment have moved closer to objectives.

Econ Comments & Analysis                                                                                            
Market Watch | Disagreement surfaces among Fed hawks on when to tighten
Two leading hawks on the Federal Reserve indicated on Friday that they disagreed on how close the central bank should be to raising interest rates.
Bloomberg | Banks Aren't Too Big to Fail Unless They Fail
One simple model is that the too-big-to-fail subsidy -- meaning the amount of money that big banks save on funding costs because their creditors assume that if anything goes wrong the government will bail them out -- is like a put option, putting some floor on the value of a bank's assets
Forbes | The Fed Needs Truly Radical Reform, Not A Timid Taylor Rule Fix
By keeping interest rates artificially low for an extended period, the Fed has encouraged risk taking, fueled asset prices, and greatly increased the probability of another boom-bust episode.
WSJ | WSJ's Hilsenrath: Fed Can Be Patient on Rate-Hike Debate After Data
Friday's employment and income reports pointed to steady U.S. job growth and firming but low inflation—trends that are likely to keep the Federal Reserve on course to end its bond-purchase program in October and remain patient before raising short-term interest rates.