monetary policy

You may have heard that the Fed announced a new round of quantitative easing yesterday. I hope you’ve been able to get your fill of QE3 elsewhere; I suspect you have but if not I recommend Cardiff Garcia and Greg Ip, though also a million other people, and maybe stay away from Marc Faber. It’s not my area of expertise; what little I know about economic matters comes from working in the financial industry, whose concern is less with how humans turn their efforts into money than with taking a bit of it from them in the process of moving it from one place or time to another. But of course central bank policy involves quite a bit of moving money between times and places, with many stops along the way where some of that money can fall off the truck, so this piqued my QE3 interest:

That’s from an interesting Credit Suisse note on the latest quantitative easing, which of course consists of the Fed buying agency securities, and shows unsurprisingly that banks are uniquely well positioned to make money on it.1 Here’s another chart from Bloomberg: Read more »

Directed at no one in particular but if a certain jelly donut-addicted Fed Chair has found even his extra-forgiving sweatpants getting too snug, he might want to take note. Read more »