Discount Rate Archive

Fed’s Lockhard on Reuters

Latest tsy tips results indicate ‘contained inflation expectations’ as well. I still have that nagging feeling that the 0 rate policy is highly deflationary and without some supply shock, like a spike in crude prices, prices in general will remain weak. The weak core CPI and high unemployment rate continues to keep ...Read More

Re: ffm questions

On Dec 18, 2007 1:09 AM, Scott Fullwiler wrote: > Hi Warren > > A few questions on your take on fed funds market data– > > Std dev of fed funds rate is way up since summer compared to normal, but > looking at the high-low numbers, the deviation (at least ...Read More

Re: credit recap

(an interoffice email) > > > > Mkt did not like the Fed move today- IG9 went from 70 out to 78.75 after the > news. CMBS cash (which had a roaring spread tightening in the morning of > about 15bp) gave all but 6bp of it back. There was a rumor ...Read More

Discount rate

Seems the fed now has some current evidence of how the discount rate can ‘cap’ year end funding costs for member banks if they remove the ‘stigma’ as recommended. Lending at the discount window jumped to $2.15 billion on Dec. 5, the largest since September. It was the first period that covered ...Read More

Fed’s best move

From the Fed’s theoretical framework, their best move is: ♦ Cut the discount rate to 4.5 ♦  Leave fed funds at 4.5 ♦ Remove the stigma from the window ♦ Allow term window borrowing over the turn ♦ Accept any ‘legal’ bank assets as collateral from member banks in good standing ♦ ...Read More