Similar Search Results

Monetary policy and the run risk of loan funds

Cetorelli, Nicola; La Spada, Gabriele; Santos, João A. C. - 2022

Loan funds are open-end mutual funds holding predominantly corporate leveraged loans. We document empirically that loan funds are significantly more susceptible to run risk than any other category of debt funds, including corporate bond funds. Most importantly, we establish a link between loan...

Persistent link: https://www.econbiz.de/10013330023

Scarce, abundant, or ample? A time-varying model of the reserve demand curve

Afonso, Gara; Giannone, Domenico; La Spada, Gabriele; … - 2022

Does the federal funds rate respond to shocks when aggregate reserves are in the trillions of dollars? Has banks' demand for reserves moved over time? We provide a structural time-varying estimate of the slope of the reserve demand curve over 2010-21. We estimate a time-varying vector...

Persistent link: https://www.econbiz.de/10013432949

Banks' balance-sheet costs, monetary policy, and the ON RRP

Afonso, Gara; Cipriani, Marco; La Spada, Gabriele - 2022

In June 2022, the Federal Reserve started reducing the size of its balance sheet, which had expanded to just under $9 trillion in response to the COVID-19 pandemic. However, whereas banks' reserves at the Federal Reserve have decreased, the investment of money market funds (MMFs) at the Federal...

Persistent link: https://www.econbiz.de/10014302763

Fed transparency and policy expectation errors: A text analysis approach

Fischer, Eric; McCaughrin, Rebecca; Prazad, Saketh; … - 2023

This paper seeks to estimate the extent to which market-implied policy expectations could be improved with further information disclosure from the FOMC. Using text analysis methods based on large language models, we show that if FOMC meeting materials with five-year lagged release dates-like...

Persistent link: https://www.econbiz.de/10014480439

Congestion in onboarding workers and sticky R&D

Bloesch, Justin; Weber, Jacob P. - 2023

R&D investment spending exhibits a delayed and hump-shaped response to shocks. We show in a simple partial equilibrium model that rapidly adjusting R&D investment is costly if the probability of converting new hires into productive R&D workers ("onboarding") is decreasing in the number of new...

Persistent link: https://www.econbiz.de/10014480663

The nonlinear case against leaning against the wind

Boyarchenko, Nina; Crump, Richard K.; Dogra, Keshav; … - 2024

We re-examine the relationship between monetary policy and financial stability in a setting that allows for nonlinear, time-varying relationships between monetary policy, financial stability, and macroeconomic outcomes. Using novel machine-learning techniques, we estimate a flexible "nonlinear...

Persistent link: https://www.econbiz.de/10014581901

Network structures and heterogeneity in policy preferences at the FOMC

Bhattacharjee, Arnab; Holly, Sean; Wasseja, Mustapha - 2024

policymaking process at the Federal Reserve Bank. We use the data compiled by Chappell et al. (2005b) on preferred interest rates … with the Bank of England's Monetary Policy Committee. …

Persistent link: https://www.econbiz.de/10015066218

Central bank digital currency and transmission of monetary policy

Bhattarai, Saroj; Davoodalhosseini, Seyed Mohammadreza; … - 2024

bank deposits are backed by loans and central bank reserves. We find that the effects of a canonical monetary policy shock …, a shock to the Taylor rule that governs interest on central bank reserves, is magnified with the introduction of a fixed …How does the transmission of monetary policy change when a central bank digital currency (CBDC) is introduced in the …

Persistent link: https://www.econbiz.de/10015067345

Decision synthesis in monetary policy

Chernis, Tony; Koop, Gary; Tallman, Emily; West, Mike - 2024

a BPDS procedure for a case study of monetary policy decision-making with an inflation-targeting central bank and …

Persistent link: https://www.econbiz.de/10015067353