What we're reading elsewhere: Warren's scholarly writings and more
By Dylan Mathews
Joseph Gagnon argues on the Huffington Post for more aggressive action from the Fed:
These measures are all within the Federal Reserve's established powers. They pose essentially no risk to the Fed's balance sheet. They would reduce unemployment roughly as much as a two-year, $600 billion fiscal package and yet they would actually reduce the federal budget deficit. And they can be reversed quickly should the balance of risks shift from deflation to inflation.
Given the unsatisfactory outlook for unemployment and inflation and the lack of action by Congress, that is the right medicine for the US economy now.
Robert Shiller says at Project Syndicate that central bankers are the best guardians of financial stability:
In fact, while the world's central banks did not see the current crisis coming and did not take steps before 2007 to relieve the pressures that led to it, they did react decisively and energetically as the crisis unfolded, with coordinated international action. This was facilitated by the tradition of political independence and cooperation that has developed over the years among central bankers.
The crisis has underscored the utmost importance of macro-prudential regulation. Although our central bankers are not perfect judges of financial stability, they are still the people who are in the best political and institutional position to ensure it.
In The Atlantic, Megan McArdle looks at Elizabeth Warren's scholarly writings:
Does this persistent tendency to choose odd metrics that inflate the case for some left wing cause matter? If Warren worked at a think tank, you'd say, "Ah, well, that's the genre." On the other hand, you'd also tend to regard her stuff with a rather beady eye. It's unlikely to have been splashed across the headline of every newspaper in the United States. Her work gets so much attention because it comes from a Harvard professor. And this isn't Harvard-caliber material -- not even Harvard undergraduate.
Tim Fernholz argues in The American Prospect that Russ Feingold's opposition pushed financial reform to the right:
What both the scholars and Pump forget is that though Republicans generally opposed a tax on the banks, Brown obtained several Massachusetts-specific loopholes in the Volcker rule. That provision was intended to block banks from speculating with their money through trading or owning hedge or equity funds, but thanks to Brown, banks can still invest substantially in the latter. Had Feingold offered his vote, or merely to help kill the Republican filibuster, it's possible that these carve-outs might not have been needed, since the Maine Republicans did not seem invested in weakening limits on bank risk.
July 22, 2010; 2:30 PM ET
Categories: Federal Reserve
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