Markets and Volatile Monetary Policy: Empirical Lessons from Banking Instability

Posted on June 12, 2023 by Lawrence Goodman

Ahead of the upcoming FOMC meeting, the Fed is dealing with another problem of its own creation. The stock market is elevated and the economy and inflation are on the descent.

Monetary policy meaningfully contributed to the distress at the Silicon Valley Bank and recent swings in financial markets.

“Markets and Volatile Monetary Policy: Empirical Lessons from Banking Instability” offers a solution for officials and an opportunity for investors to profit.

We look forward to any comments you might have.

To view the full article:
https://centerforfinancialstability.org/research/Markets_Volatile_Monetary_061123.pdf

Last week, we released “A Story of Money, Inflation, and the CFS.”

A Story of Money, Inflation, and the CFS

Posted on June 6, 2023 by Lawrence Goodman

At the Center for Financial Stability (CFS), we see the world differently. We see the world through monetary goggles – not at the exclusion of other variables, but from a different perspective.

Since 1) inflation proved to not be transitory after the post-pandemic fiscal and monetary response and 2) inflation remained negligible after the big money supply increases in 2009 to 2010, our perspective is essential for:

Officials to strengthen the financial system while more effectively promoting growth and
Investors to safeguard assets, manage financial institutions, or seek profits.

We look forward to any comments you might have.

Next week, CFS will release a paper on “Empirical Lessons for the Fed from Banking Instability.”

To view the full article:
https://www.centerforfinancialstability.org/research/Money_Story_060623.pdf