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Fed Split Over How Long To Keep Cash Spigot Open

Wall Street Journal Original article ›

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Issuance of junk bonds in 2012 reached $274 billion in 2012, an increase of 55% over 2011, according to Dealogic. This is double the levels observed before the financial crisis of 2008. Yields on low rated junk bonds have declined to about 6% as prices move up. Also observed is an increase in covenant lite corporate loans. These types of loans relax lending standards- this increased from $8.5 billion in 2010 to $36.5 billion 2011, and $58 billion in 2012, according to Dealogic. This has drawn the attention of Fed Governors Jeremy Stein and Richard Fisher of the Dallas Fed, who have raised a warning about the rapid increase in credit and financial risks.

The U.S. Federal Reserve's Large Institution Supervision Coordination Committee (LISCC) and regulation of U.S. banks

02/17/2011

The Fed's LISCC is responsible for regulation of U.S. banks, replacing the prior system which diffused regulatory responsibilities among the 12 Fed regional banks. The earlier system did not assign regulatory authority to a specific supervisory organization with the the resources to tackle regulatory tasks leading to the 2008 financial crisis. Fed governor Daniel Tarullo and his organization now tackle the tasks and work with Fed chairman Bernanke on regulatory matters, bringing responsibility and accountability in one location.

Grouped Articles

Central Bankers Hone Tools to Pop Bubbles

Wall Street Journal 07/08/2013

Fed Split Over How Long To Keep Cash Spigot Open

Wall Street Journal 02/20/2013

The Power Behind the Throne at the Federal Reserve

New York Times 07/31/2013

Fed Boosts Pressure on Banks Over Capital Levels

Wall Street Journal 08/20/2013

In Surprise, Fed Decides to Maintain Pace of Stimulus

New York Times 09/18/2013

Banks Ordered to Add Capital to Limit Risks

New York Times 04/08/2014

John Taylor on U.S. Federal Reserve policies and booms and busts in the U.S. economy and no clear exit strategy

01/27/2009

Taylor points out that the dual mandate for maintaining unemployment and inflation goals has led to discretionary policies that have hurt the economy by leading to booms and busts. He calls for a single mandate on inflation goals. Taylor provides advice on the Romney Plan.

Grouped Articles

Martin Feldstein: The Federal Reserve's Policy Dead End

Wall Street Journal 05/09/2013

Once Again, the Fed Shies Away From the Exit Door

Wall Street Journal 07/11/2013

Bhidé and Phelps: Central Banking Needs Rethinking

Wall Street Journal 07/16/2013

Sluggish Economic Recovery Proves Resilient

Wall Street Journal 04/21/2014

The Dangers of an Interventionist Fed

Wall Street Journal 03/29/2012

S.&P. 500 Dips After Fed Signals No New Stimulus

New York Times 04/04/2012

U.S. Federal Reserve and policies to counteract the effects of the "fiscal cliff" on GDP and economic growth in 2013

08/22/2012

Grouped Articles

Bernanke Plays Down Link Between Jobless Rate, Fed Moves

Wall Street Journal 07/18/2013

Tepid Growth Restrains Fed

Wall Street Journal 08/01/2013

In Surprise, Fed Decides to Maintain Pace of Stimulus

New York Times 09/18/2013

Economists See Nominee as Slightly More Dovish Bernanke

Wall Street Journal 10/10/2013

Yellen’s Path From Liberal Theorist to Fed Voice for Jobs

New York Times 10/09/2013

The Yellen Fed? Precise and Predictable

New York Times 10/09/2013


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