Economics
State money and bank money: lifting the fog around QE
Steve Hanke says economists are missing important details by focusing on interest rates, rather than the money supply
ECB papers take detailed look at bond market data
Two papers from the European Central Bank take a detailed look at data on the development of credit spreads in eurozone corporate bonds
Debt levels in most advanced and emerging economies are too high, Dombret says
Belief in ‘more finance, more growth’ is ‘sexy’ but ‘a sham’, Bundesbank executive board member argues; debt levels in most economies are ‘too high’
Helicopter money still contentious as Borio enters debate
Article by Claudio Borio and others claims helicopter money means giving up on monetary policy for ever, but economists such as Adair Turner and John Muellbauer question the result
Book notes: A few hares to chase, by Alan Bollard
The former Reserve Bank of New Zealand governor has produced a interesting account of the life of engineer-turned-economist Bill Phillips
BIS paper: money growth-inflation link weakens, credit link grows
Authors find money growth is less important in driving price changes, but credit growth is becoming a more critical factor in financial crises
Trinidad and Tobago governor predicts GDP contraction of up to 2.5%
Contraction of 2.5% expected amid falling oil prices; co-ordinated fiscal, monetary and structural reforms would increase recovery's chance of success, Hilaire says
Slow growth need not be the ‘new normal’ – Richmond Fed paper
Authors give reasons for optimism about the future of US economic growth, and outline policies that could support it, although most are outside the control of the central bank
Greek deal unlocks funds but delays debt relief
Deal allows possibility of future debt relief but drops IMF’s stronger demands; pushes most difficult decisions back
BoE economists map current account dangers across OECD
Treating the current account as equivalent to the balance of trade could blind economists to the risks posed by large deficits, say Kristin Forbes, Ida Hjortsoe and Tsvetelina Nenova
Fischer: improve estimates of long-run equilibrium rate
Fed vice-chair speaks at conference honouring US economist Michael Woodford; stresses need for "faster potential growth" as US nears full employment
BIS’s Tissot says micro data can plug macro gaps
Data is abundant in many areas, but making micro data work with macro is still proving tricky for statisticians, says BIS head of statistics
Iran must contain liquidity growth to safeguard inflation success, IMF’s Lipton says
Speaking at the Iranian central bank, David Lipton discusses how inflation can be anchored in single digits, after steadily declining in past year
BoE’s Weale: t-distribution may outperform normal
Representing monetary policy committee’s judgements using the t-distribution implies GDP outcomes are skewed to the downside and inflation to the upside
Mester favours ‘error band’ around FOMC projections
Cleveland Fed president Loretta Mester would like to some kind of “error band” introduced around FOMC projections, to reflect the uncertainty the committee is grappling with
Building a fast, flexible and free DSGE model
A team at the New York Fed is part way through translating its DSGE model into Julia, a fast, open-source mathematical programming language
IMF issues stark warning to UK on EU exit
Bank of England could find itself battling market dislocation and “substantial” economic slowdown if UK votes to leave EU, IMF warns; Christine Lagarde dismisses accusations of political meddling
Spanish paper explores low TFP growth during expansion
Working paper notes total factor productivity fell between 1995 and 2007 despite solid growth rates in the economy; highlights misallocation of production factors within industry
Malaysian governor explores sustainable finance tools
Muhammad bin Ibrahim sees potential for asset class backed by carbon credit-based solutions but structured using Islamic finance principles
Canadian university to establish central banking chair
Western University, in Ontario, to create post following donation from Jarislowsky Foundation; institution counts Glenn Stevens and Stephen Poloz among alumni
Borio: Pluralism may not be answer to weakness in international system
Claudio Borio sees the “main problem” in the international monetary and financial system as the lack of an effective anchor, and is not sure greater pluralism addresses this
Fed presidents get to grips with weaker productivity data
John Williams and Neel Kashkari discuss short- and long-term factors that could be depressing productivity growth; latest data reveals further slide in quarterly figures
German supervisors need more granular data – IMF staff
Staff say concerns about a housing bubble “look premature” but better data would help the authorities be prepared for imbalances; urge faster progress on structural reforms
Researchers conduct ‘horse race’ of financial crisis early-warning models
Statistical approaches based on machine learning appear to offer more robust early warnings of financial crisis than models based on more conventional techniques, two researchers say