The President opened his press conference by designating the top two priorities as jobs and growth, and then spent the next 60 minutes answering questions about David Petraeus and Susan Rice and tax rates and Benghazi and deficit reduction. And Obama didn’t seek to break out of that constraint and suggest actual near-term job creation [...]

It wasn’t so long ago that Narayana Kocherlakota, the President of the Minneapolis Federal Reserve, was the leader of the coalition arguing for tighter monetary policy, even in the middle of mass unemployment. He claimed that unemployment was structural in nature, and that we risked runaway inflation with ultra-low interest rates. Just a year or [...]

The Special Inspector General for TARP, Christy Romero, has recommended that the Federal Reserve and the Treasury Department stop using LIBOR, the benchmark interest rate derived in such a slipshod way that it was rigged for years. But the Fed and Treasury aren’t taking Romero up on the request. The Treasury and the Fed should [...]

The Federal Reserve stood pat today, determining that they would continue with QE3 despite the relative improvement in economic performance. This clears one hurdle lingering in the minds of some observers: would the Fed have the resolve to stay the course, even if the economy strengthened, which would probably lead to an uptick in inflation? [...]

In an announcement that would have really helped two years ago, Federal Reserve Governor Daniel Tarullo called for a size cap on the largest financial firms. Tarullo is the point person at the Fed for bank policy, including consumer protection and regulatory measures. So he’d be in the best position in that organization to know [...]

I guess I’m supposed to be impressed by this new expansion of stress tests by the financial regulatory apparatus. The biggest U.S. banks will have to run two internal “stress tests” each year and publish some of the results on their websites under new rules that enshrine the examinations as a central plank of postcrisis [...]

Contrast the plans of Congress to give up on job creation and move expeditiously to deficit reduction with the plans of the Federal Reserve to belatedly but nonetheless insistently and with near-unanimous participation engage in the monetary tools at their disposal to boost the economy and lower unemployment. There are serious questions about the beneficiaries [...]

I don’t know whether this is a positive sign about policymakers recognizing the depth of our economic problems, or a negative sign about the depth of our economic problems. But the President of the Minneapolis Federal Reserve, Narayana Kocherlakota, set a target unemployment rate he would like to see before the Fed raises the federal [...]

As the economic recovery drags on in excruciatingly slow fashion, one thing should concern the country: we’re in no position to handle another economic shock. Just as a family overburdened by mortgage debt would be ill-equipped to withstand an economic blow like sudden unemployment or a medical catastrophe, a country with a too-high unemployment rate [...]

Analysts have tried to parcel out whether QE3 will really help the economy. I’ve done the same thing myself. The way almost everyone looks at this is about the impact on housing, specifically mortgage prices. But mortgage rates haven’t changed at all since the announcement of QE3, and if the Fed was trying to influence [...]

Stocks have leveled off after yesterday’s boost from the Federal Reserve’s resumption of quantitative easing, this time in a more modest but open-ended capacity. Most analysts take for granted that this new QE3 will work, in fact, better than the first two rounds despite its smaller footprint. That stems from the use of the expectations [...]