Jeffrey Lacker on Governance at the Federal Reserve

William Diamond is an Assistant Professor of Finance at the Wharton School of Business at the University of Pennsylvania. Will joins David on Macro Musings to discuss safe assets, convenience yields, bubbles and public debt and the implications for policy. Specifically, David and Will get into competing theories of interest rates and the rise of New Keynesian thinking, the role of the dollar in the global financial system, the drivers behind the growth in US debt, how the construction of risk-free interest rates unaffected by convenience yields on safe assets can improve our understanding of the financial system in times of stress, and much more.   Check out Ideas of India: https://www.discoursemagazine.com/tag/ideas-of-india-podcast/, and subscribe to Ideas of India on your favorite podcast app.   Transcript for the episode can be found here.   Will’s Twitter: @wdiamond_econ Will’s Wharton profile: https://fnce.wharton.upenn.edu/profile/diamondw/#research   Related Links:   *Threats to Central Bank Independence: High-Frequency Identification with Twitter* by Francesco Bianchi, Thilo Kind & Howard Kung https://www.nber.org/papers/w26308   *Safety Transformation and the Structure of the Financial System* by Will Diamond https://faculty.wharton.upenn.edu/wp-content/uploads/2017/07/modelwriteupnew23.pdf   *From World Banker to World Venture Capitalist: The US External Adjustment and the Exorbitant Privilege* by Helene Ray and P.O. Gourinchas https://papers.ssrn.com/sol3/papers.cfm?abstract_id=788428   *Rational Bubbles and Public Debt Policy: A Quantitative Analysis* by David Domeij and Tore Ellingsen https://www.sciencedirect.com/science/article/abs/pii/S0304393218301909   *Liquidity Premiums on Government Debt and the Fiscal Theory of the Price Level* by Aleksander Berentsen and Christopher J. Waller https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2943241   *Risk Free Interest Rates* by Jules H. van Binsbergen, Will Diamond, and Marco Grotteria https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3242836   *Risk-Free Rates and Convenience Yields Around the World* by Will Diamond, Peter Van Tassel https://faculty.wharton.upenn.edu/wp-content/uploads/2021/11/newdraft_11132021formatfix.pdf   David’s Twitter: @DavidBeckworth David’s blog: http://macromarketmusings.blogspot.com/

21 Feb 20221h 5min

Amanda Rose is a professor at Vanderbilt Law School where she works as a scholar on securities law and the institutional design of the regulatory regimes enforcing those laws. Amanda joins Macro Musings to talk about the Securities and Exchange Commission (SEC), its work and role in promoting financial stability, and her research on the SEC. Amanda and David specifically discuss the politics, governance, and politicization of the SEC, the mission of the agency, and the major issues that it must face moving forward.   Check out Conversations with Tyler: https://conversationswithtyler.com, and subscribe to Conversations with Tyler on your favorite podcast app.   Transcript for the episode can be found here.   Amanda’s Vanderbilt Law profile: https://law.vanderbilt.edu/bio/amanda-rose   Related Links:   *Calculating SEC Whistleblower Awards: A Theoretical Approach* by Amanda Rose https://scholarship.law.vanderbilt.edu/cgi/viewcontent.cgi?article=2143&context=faculty-publications   *SPAC Mergers, IPOs, and the PSLRA’s Safe Harbor: Unpacking Claims of Regulatory Arbitrage* by Amanda Rose https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3945975   *A Response to Calls for SEC-Mandated ESG Disclosure* by Amanda Rose https://openscholarship.wustl.edu/cgi/viewcontent.cgi?article=6545&context=law_lawreview   *Should the Securities and Exchange Commission Adopt a Mandatory ESG-Disclosure Framework?* by Amanda Rose https://www.mercatus.org/publications/financial-markets/should-securities-and-exchange-commission-adopt-mandatory-esg   *SEC Announces Enforcement Results for FY 2021* by the U.S. Securities and Exchange Commission https://www.sec.gov/news/press-release/2021-238   *The Chickenshit Club: Why the Justice Department Fails to Prosecute Executives* by Jesse Eisinger https://www.sandmanbooks.com/book/9781501121371   *Can NFTs Be Securities? The SEC Says Yes* by PYMNTS https://www.pymnts.com/nfts/2022/pymnts-nft-series-can-nfts-be-securities-the-sec-says-yes/   *Crypto Exchanges Will Face More Scrutiny, Says SEC Chair* by Rahul Nambiampurath https://finance.yahoo.com/news/crypto-exchanges-face-more-scrutiny-150149395.html#:~:text=SEC%20Chair%20Gary%20Gensler%20has,world%20are%20scrutinizing%20crypto%20exchanges.   David’s Twitter: @DavidBeckworth David’s blog: http://macromarketmusings.blogspot.com/

14 Feb 202254min

Dan Alpert is an investment banker and a founding Managing Partner of Westwood Capital. He also regularly writes and speaks on big macro-structural issues. Dan joins David on Macro Musings to discuss recent macroeconomic events. Specifically, Dan and David discuss a post-Keynesian account of the global safe asset shortage, the impact of the US policy response to COVID-19, whether inflation will remain a problem heading into 2022, what’s driving the ‘Great Resignation’, whether capital assets are overvalued, and much more.   Check out Ideas of India: https://www.discoursemagazine.com/tag/ideas-of-india-podcast/, and subscribe to Ideas of India on your favorite podcast app.   Transcript for the episode can be found here.   Dan’s Twitter: @DanielAlpert Dan’s Westwood Capital profile: http://www.westwoodcapital.com/ourpeople/daniel-alpert/   Related Links:   *The Age of Oversupply: Overcoming the Greatest Challenge to the Global Economy* by Dan Alpert https://www.penguinrandomhouse.com/books/312886/the-age-of-oversupply-by-daniel-alpert/    *Glut, The US Economy and American Worker In The Age Of Oversupply* by Dan Alpert https://www.thirdway.org/report/glut-the-u-s-economy-and-the-american-worker-in-the-age-of-oversupply   *Inflation In The 21st Century* by Dan Alpert https://scholarship.law.cornell.edu/facpub/1740/   *The Way Forward: Moving from the Post-Bubble, Post-Bust Economy to Renewed Growth and Competitiveness* by Dan Alpert, Robert C. Hockett, and Nouriel Roubini https://papers.ssrn.com/sol3/papers.cfm?abstract_id=1987139   *Marc Lavoie on Canadian Central Bank Policy, Real-time Payments, and the Post-Keynesian Tradition* https://www.mercatus.org/bridge/podcasts/02032020/marc-lavoie-canadian-central-bank-policy-real-time-payments-and-post   David’s Twitter: @DavidBeckworth David’s blog: http://macromarketmusings.blogspot.com/

7 Feb 202247min

Lubos Pastor is a professor of finance, and Elisabeth Kempf is an associate professor of finance, both at the University of Chicago’s Booth School of Business. They join David on Macro Musings to talk about their recent paper, *Fifty Shades of QE: Comparing Findings of Central Bankers and Academics*. Lubos, Elisabeth, and David specifically discuss the scope, design, and findings of their study, the theory behind QE’s impact on output and inflation, the career implications of QE research, and more.   Check out Conversations with Tyler: https://conversationswithtyler.com, and subscribe to Conversations with Tyler on your favorite podcast app.   Transcript for the episode can be found here.   Lubos’s University of Chicago profile: https://www.chicagobooth.edu/faculty/directory/p/lubos-pastor Lubos’s NBER archive: https://www.nber.org/people/lubos_pastor?page=1&perPage=50   Elisabeth’s University of Chicago Profile: https://www.chicagobooth.edu/faculty/directory/k/elisabeth-kempf Elisabeth’s website: https://sites.google.com/site/elikempf/   Related Links:   *Fifty Shades of QE: Comparing Findings of Central Bankers and Academics* by Lubos Pastor, Elisabeth Kempf, Brian Fabo, and Martina Jancokova https://www.nber.org/system/files/working_papers/w27849/w27849.pdf   *The Federal Reserve System’s Influence on Research in Monetary Economics* by Lawrence H. White https://econjwatch.org/File+download/90/2005-08-white-invest_apparatus.pdf?mimetype=pdf   David’s Twitter: @DavidBeckworth David’s blog: http://macromarketmusings.blogspot.com/

31 Jan 202243min

George Selgin is a senior fellow and director emeritus of the Center for Monetary and Financial Alternatives at the Cato Institute and is also a long-time returning guest of Macro Musings. In this bonus segment from the previous conversation, George rejoins the podcast to talk about the Fed’s near-term plans to shrink its balance sheet, the impact of the standing repo facility on demand for reserves, the potential benefits of returning to a corridor operating system, and more.     Check out Ideas of India: https://www.discoursemagazine.com/tag/ideas-of-india-podcast/ Subscribe to Ideas of India on your favorite podcast app.   Transcript for the episode can be found here.   George’s Twitter: @GeorgeSelgin George’s Cato Institute profile: https://www.cato.org/people/george-selgin   Related Links:   *Floored!* by George Selgin https://www.cato.org/working-paper/floored   *The Menace of Fiscal QE* by George Selgin https://www.cato.org/books/menace-fiscal-qe   *Churning at the Fed* by Milton Friedman https://miltonfriedman.hoover.org/internal/media/dispatcher/214260/full   David’s Twitter: @DavidBeckworth David’s blog: http://macromarketmusings.blogspot.com/

26 Jan 202232min

George Selgin is a senior fellow and director emeritus of the Center for Monetary and Financial Alternatives at the Cato Institute and is also a long-time returning guest of Macro Musings. He rejoins the podcast to talk about central bank digital currency, stablecoins, and the future of the Fed’s balance sheet and operating system. Specifically, David and George also discuss the challenges presented by CBDC and Fed accounts, how they could create financial instability, George’s proposal for wholesale CBDC, and more.   Check out Conversations with Tyler: https://conversationswithtyler.com, and subscribe to Conversations with Tyler on your favorite podcast app.   Transcript for the episode can be found here.   George’s Twitter: @GeorgeSelgin George’s Cato Institute profile: https://www.cato.org/people/george-selgin   Related Links:   *Central Bank Digital Currency as a Potential Source of Financial Instability* by George Selgin https://www.cato.org/cato-journal/spring/summer-2021/central-bank-digital-currency-potential-source-financial-instability#old-fashioned-bank-runs   *Money and Payments: The U.S. Dollar in the Age of Digital Transformation* by the Federal Reserve Board of Governors https://www.federalreserve.gov/publications/files/money-and-payments-20220120.pdf   *George Selgin on the Past, Present, and Future of a Real-Time Payments System* https://www.mercatus.org/bridge/podcasts/11112019/george-selgin-past-present-and-future-real-time-payments-system   David’s Twitter: @DavidBeckworth David’s blog: http://macromarketmusings.blogspot.com/

24 Jan 202252min

Henry Curr is the economics editor for the Economist Magazine and a returning guest to the show. Henry has a new working paper out titled, “Money Printers Go Grrrr: Three Myths and Three Uncomfortable Truths about Quantitative Easing.” Henry joins Macro Musings to discuss these three myths and uncomfortable truths about QE. Specifically, David and Henry discuss the continued relevance of quantitative easing as a policy tool, QE’s relationship to financial markets and its effect on the banking sector, whether we can estimate the magnitude of its effect on interest rates, whether QE necessarily boosts the monetary base, and much more.   Check out Ideas of India, another Mercatus original podcast: https://www.discoursemagazine.com/tag/ideas-of-india-podcast/   Transcript for the episode can be found here.   Henry’s Twitter: @Henry_Curr Henry’s Economist profile: https://mediadirectory.economist.com/people/henry-curr/ Henry’s website: http://www.henrycurr.com/   Related Links:   *Money Printers Go Grr: Three Myths and Three Uncomfortable Truths about Quantitative Easing* by Henry Curr https://spe.org.uk/reading-room/ryb-essays/2020-21-rybczynski-prize-essay/   *Fifty Shades of QE: Comparing Findings of Central Bankers and Academics* by Brian Fabo, Martina Jančoková, Elisabeth Kempf and Ľuboš Pástor https://www.nber.org/papers/w27849   David’s Twitter: @DavidBeckworth David’s blog: http://macromarketmusings.blogspot.com/

17 Jan 202251min

Lorie Logan is an executive vice president in the Markets Group of the Federal Reserve Bank of New York. In that role, she’s the manager of the System Open Market Account (SOMA), for the Federal Open Market Committee (FOMC), and she is also the head of the market operations, monitoring, and analysis. Lorie joins Macro Musings to talk about the operations side of monetary policy and her work at the New York Fed. Specifically, David and Lorie discuss the “dash for cash” during the March 2020 Treasury market crisis, the Fed’s new standing repo facility, the future of the central bank’s balance sheet, and more.   Transcript for the episode can be found here.   Lorie’s New York Fed profile: https://www.newyorkfed.org/aboutthefed/orgchart/logan Lorie’s Fed in Print archive: https://fedinprint.org/search?facets[]=authors_literal_array:Logan%2C+Lorie   Related Links:   *Monetary Policy Implementation: Adapting to a New Environment* by Lorie Logan https://www.newyorkfed.org/newsevents/speeches/2021/log211014   *Liquidity Shocks: Lessons Learned from the Global Financial Crisis and the Pandemic* by Lorie Logan https://www.newyorkfed.org/newsevents/speeches/2021/log210811   *Recent Disruptions and Potential Reforms in the U.S. Treasury Market: A Staff Progress Report* by the Inter-Agency Working Group https://home.treasury.gov/system/files/136/IAWG-Treasury-Report.pdf   *U.S. Treasury Markets: Steps Toward Increased Resilience* by the G30 Working Group on Treasury Market Liquidity https://group30.org/publications/detail/4950   *Report of the Task Force on Financial Stability* by Glenn Hubbard et al. https://www.brookings.edu/research/report-of-the-task-force-on-financial-stability/   David’s Twitter: @DavidBeckworth David’s blog: http://macromarketmusings.blogspot.com/

10 Jan 202236min