We estimate the reaction of the hotel and restaurant industries to the monetary policy actions of the Federal Reserve in the US. We find that the portfolios of hotel industry stocks react strongly to the unexpected changes in the Federal Funds Target Rate. Specifically, for a hypothetical...

During the last financial crisis, what should the Federal Reserve (Fed) have done after credit dried up, creating a liquidity crisis even for borrowers with sterling credit and good collateral? The conventional answer is that during a market-wide liquidity crisis the central bank should act as a...

In response to the financial crisis that began in 2007, the Federal Reserve ('Fed') initiated a series of ad hoc deals (for Bear Stearns and AIG) and new lending facilities that benefited a variety of other nonbank financial intermediaries. Through these deals and programs the Fed became a...

A vast literature has emerged using Taylor rules to analyze monetary policy Although very attractive both theoretically and empirically such rules imply a mechanical response by the policy variable to fundamental ones This study looks for empirical evidence of a more sophisticated monetary...

The paper shows that there is a substantial degree of heterogeneity in the ability of Fed watchers to forecast US monetary policy decisions. Based on a novel database for 268 professional forecasters since 1999, the average forecast error of FOMC decisions varies 5 to 10 basis points between the...

This paper uses a factor-augmented vector autoregressive model (FAVAR) estimated on U.S. data in order to analyze monetary transmission via private sector balance sheets, credit risk spreads and asset markets in an integrated setup and to explore the role of monetary policy in the three...