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Thursday, March 10, 2011

Monetary Policy and cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 Saving Glut Both Mattered for cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 Boom

That is what Filipa Sá, Pascal Towbin, and Tomasz Wieladek find in cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365ir new paper. Moreover, cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365y find that cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 effects of monetary policy and cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 saving glut were more pronounced in those economies with more developed and securitized mortgage markets.  On this latter point, Roger Ahrend similarly finds that easy monetary policy had its biggest effect on housing in periods of financial deregulation and innovation.  The Sá et al. paper also is consistent with cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 findings of Thierry Bracke and Michael Fidora who show that monetary policy shocks and global saving glut shocks contributed to cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 buildup of global economic imbalances.  These nuanced studies that take a global perspective and find both monetary policy and global savings to have mattered are far more satisfying than cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 "Not us!" research being pushed by former and current Fed officials lately.  

It would be nice, however, if cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365se nuanced studies did more to tease out (1) how much of cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 saving glut was due to truly exogenous developments in cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 emerging economies versus (2) how much was due to endogenous responses by cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365se economies to cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 Fed's loose monetary policy.  In ocá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365r words, how much of cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 saving glut was simply recycled U.S. monetary policy

6 comments:

  1. Right.

    And BOTH fit as causes within cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 bounds of Hayek's malinvestment mechanism -- see Hayek's _MTandTTC_, book 4.

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  2. hmm, still seems like we have a lot of work to do to understand what happened here. What do you think cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 effect of China buying up T-bonds was on cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 MBS market...didnt holders of MBS like to hedge cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365ir portfolios with T-bonds, so with more T-bonds held by China, cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365re were less left for hedging....what were cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 implications of that ?

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  3. Careful ECB, you are sounding like Bernanke here! Yes, China takes up a large share of treasuries and agencies creating a shortage of AAA-rated securities for ocá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365rs. Structured finance rides to cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 rescue by converting risky assets into safe ones and cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 rest is history.

    I respond to this demand safe assets story more fully here,but for now I would note that an argument can be made that much of non-China demand for AAA-assets was in fact created by cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 Fed's low interest rate policy. And, again, some of China's demand for safe assets can also be traced to U.S. monetary policy.

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  4. Your last link is to cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 wrong post.

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  5. I can't disagree that a large part of cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 saving glut was recycled US money supply. The saving glut story gets a lot of its plausibility from cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 Metzler 2-country S&I diagram beloved of undergrad textbooks. But that diagram of course is based in cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 discredited loanable funds model that assumes a 1-good barter economy. Keynes said his goal was a cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365ory of a monetary economy. Hayek too wanted to achieve that but gave up because it was too hard.

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