Tag Archives: federal reserve

The Fed and the Consequences of Bad Predictions

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South Africa's government in recent years voted to jail people who make unauthorized and inaccurate forecasts. Good thing for the Federal Reserve that their bad predictions don't carry consequences. [Credit: University of MN]

South Africa’s gov­ern­ment in recent years vot­ed to jail peo­ple for mak­ing unau­tho­rized and inac­cu­rate weath­er fore­casts. Good thing for the Fed­er­al Reserve that their bad pre­dic­tions don’t car­ry con­se­quences. [Cred­it: Uni­ver­si­ty of MN]

The South African gov­ern­ment in recent years con­sid­ered a bill to jail peo­ple who pub­lished inac­cu­rate and unau­tho­rized fore­casts of severe weather.

Hold­ing peo­ple account­able for their pre­dic­tions seems a bit harsh in this sea­son of pre­dic­tions. But the South Africans do have a point: pre­dic­tions have con­se­quences. That’s as true of pre­dic­tions about the econ­o­my as about the weath­er, some­thing that the Fed­er­al Reserve might do well to pon­der. Con­tin­ue read­ing →

The NSA And Government’s Gradual And Silent Encroachments

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Federal District Court Judge Richard J. Leon on Monday ruled that NSA monitoring of cellphone traffic is unconstitutional. [Credit: Minority Report Blog]

Fed­er­al Dis­trict Court Judge Richard J. Leon on Mon­day ruled that NSA mon­i­tor­ing of cell­phone traf­fic is uncon­sti­tu­tion­al. [Cred­it: Minor­i­ty Report Blog]

On March 5, 1976, Patri­cia McDo­nough was robbed.  She report­ed the crime to the Bal­ti­more police. Soon after, McDo­nough began receiv­ing threat­en­ing and obscene phone calls from a man pur­port­ing to be the rob­ber.  At one point, the caller asked her to step onto her porch.  Short­ly after she did, she saw a 1975 Monte Car­lo dri­ving slow­ly past her home.  She recalled see­ing that same car near the crime scene. She report­ed the tag num­ber to the police, enabling them to iden­ti­fy the own­er as Michael Lee Smith.

The police asked the tele­phone com­pa­ny to install a pen reg­is­ter — an elec­tron­ic device that records all num­bers called from a par­tic­u­lar tele­phone line – to mon­i­tor Smith’s home phone.  The device helped police deter­mine that Smith had placed the offen­sive calls to McDo­nough, lead­ing to his arrest and con­vic­tion. Con­tin­ue read­ing →

Could A Wealth Tax Solve the Problem of Government Debt?

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A recent IMF report suggests that this man's enormous wealth might help resolve the government's debt problem. [Credit: NY Post]

A recent IMF report sug­gests that this man’s enor­mous wealth might help resolve the gov­ern­men­t’s debt prob­lem. [Cred­it: NY Post]

The Inter­na­tion­al Mon­e­tary Fund (IMF) recent­ly report­ed that Euro­pean gov­ern­ments could reduce their debt back to pre-Great Reces­sion lev­els by con­fis­cat­ing 10 per­cent of the wealth held by their rich­est cit­i­zens. IMF isn’t rec­om­mend­ing that, of course.

They’re just sayin’. Con­tin­ue read­ing →

It’s Hard To Say No In That Fair Land of the Si’

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It's been a rough year for Italy's Silvio Berlusconi, who narrowly lost an election and was convicted of a crime that may result in his expulsion from the Senate. [Credit: Getty images]

It’s been a rough year for Italy’s Sil­vio Berlus­coni, whose par­ty nar­row­ly lost an elec­tion and who was him­self con­vict­ed of a crime that may result in his expul­sion from the Sen­ate. [Cred­it: Get­ty Images]

“Ah, Pisa , you the scan­dal of the peo­ples of that fair land where si’ is heard.”

– Dante

Washington’s flir­ta­tion with default engen­dered end­less hand-wring­ing about the par­lous state of our polit­i­cal sys­tem. But by Ital­ian stan­dards, Con­gress and the Pres­i­dent are doing just fine.

Last month, while GOP “defund Oba­macare” vig­i­lantes near­ly caused the mas­sive spend­ing and bor­row­ing machine that is our fed­er­al gov­ern­ment to seize up, Italy’s gov­ern­ment served up a sump­tu­ous feast of dys­func­tion, replete with sex scan­dals, res­ig­na­tions of cab­i­net min­is­ters, and an abortive attempt to top­ple a gov­ern­ment inca­pable of gov­ern­ing. Con­tin­ue read­ing →

Republicans Getting Deficit Reduction, But President Getting His Way

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The President and Speaker are headed for another budget confrontation. [Credit: Fox News]

The Pres­i­dent and Speak­er are head­ed for anoth­er bud­get con­fronta­tion. [Cred­it: Fox News]

Con­gress is on hol­i­day, rest­ing up for the next round of bud­get wars that will resume after Labor Day. The issues they will face when they return are famil­iar: the fed­er­al gov­ern­ment is about to lose author­i­ty to do what it does best (or, at least, most nat­u­ral­ly) – bor­row and spend. Con­tin­ue read­ing →

Fed Up: Judge Strikes Down Federal Reserve on Swipe Fees

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The Fed holds all the cards when it sets a policy. Nobody bothered telling that to a federal judge, who last week struck down a Fed regulation on debit card swipe fees.

The Fed holds all the cards when it sets pol­i­cy. Nobody both­ered telling that to a fed­er­al judge, who last week struck down a Fed reg­u­la­tion on deb­it card swipe fees.

When it comes to bailouts, mon­e­tary pol­i­cy, and bank­ing reg­u­la­tion, the Fed­er­al Reserve has the last word. No one – not the Pres­i­dent, not Con­gress, not any­one – stops the Fed from doing what it has deter­mined to do. Until last week. Con­tin­ue read­ing →

Economic Inequality Not Obama’s Fault

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The "Occupy Wall Street" demonstrations are a distant memory, but the economic disparities they decried still persist. [Credit: ABC News]

The “Occu­py Wall Street” demon­stra­tions are a dis­tant mem­o­ry, but the eco­nom­ic dis­par­i­ties they decried still per­sist. [Cred­it: ABC News]

Pres­i­dent Oba­ma has a new plan to revi­tal­ize the mid­dle class.  It almost cer­tain­ly won’t work, but that almost cer­tain­ly isn’t his fault.  Con­tin­ue read­ing →

How’s That Cyprus “Bail-In” Working Out?

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The Cyprus "bail-in" is no more popular today than when it was hatched last spring. [Credit: CNNMoney.com]

The Cyprus “bail-in” is no more pop­u­lar today than when it was hatched last spring. [Cred­it: CNNMoney.com]

You may remem­ber Cyprus, the Mediter­ranean island that grabbed inter­na­tion­al head­lines last March when its gov­ern­ment was com­pelled by Euro­pean author­i­ties to seize mon­ey that indi­vid­u­als and busi­ness­es had deposit­ed in the country’s two largest banks.

The “bail-in” of Cypri­ot banks, so called because it requires peo­ple who have deposit­ed their mon­ey in fail­ing banks to help save those banks by for­feit­ing some of their deposits, is a por­tent of bank res­cues to come.  Con­tin­ue read­ing →

The Fed, the ECB and La Dolce Vita

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Fellini celebrated "La Dolce Vita" in his film classic. Today, Italians may feel as though they're living in a Fellini flick. [Credit: theworld.org]

Felli­ni cel­e­brat­ed “La Dolce Vita” in his film clas­sic.  But a strug­gling econ­o­my, wob­bly banks and frac­tious pol­i­tics threat­en to take the “dolce” out of their vita. [Cred­it: theworld.org]

Stran­gozzi is the char­ac­ter­is­tic pas­ta of Umbria, Tuscany’s hot sister.

Con­tin­ue read­ing →

Blu-Ray, Netflix and Our Troubled Economy

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Sony prevailed over Toshiba in the shoot-out over high-def DVDs. [Credit: originalprop.com]

Sony pre­vailed over Toshi­ba in the shoot-out over high-def DVDs. [Cred­it: originalprop.com]

Why can’t you stream your favorite movie on Net­flix? And what does that have to do with a scle­rot­ic economy?

Econ­o­mist and invest­ment strate­gist Jef­frey Snider offers an intrigu­ing expla­na­tion. Con­tin­ue read­ing →