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The Unfolding Fiscal Disaster Behind ACA Enrollment Figures

Charles Blahous | 04/17/2014

Earlier this month there was tremendous press attention to new data indicating that enrollment in the Affordable Care Act (ACA)’s health insurance exchanges had surpassed 7 million. The White House took a victory lap while much of the press, desperate to write something positive after months of reporting Read more...

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Making Central Banks More Resistant to Political Pressures and Fads

Charles W. Calomiris | April 14, 2014

This paper was presented April 13, 2014 at the International Monetary Fund’s Spring 2014 Meetings, in the session entitled “Can or Should Central Banks Remain Fully Independent Despite a Wider Mandate and Considerable Fiscal Pressure?”

Over the first 100 years of Federal Reserve System history, the United States enjoyed both price stability and the absence of banking crises in only about a quarter of those years. Allan Meltzer’s (2003, 2009, 2010) three volume history of the Fed (and the voluminous literature on Fed history published before and since)[1] document that two main influences explain persistent Fed failure: politicization of Fed decisions (especially to elicit Fed assistance in accomplishing short-term fiscal or electoral objectives of the Administration), and model misspecification (reflecting the limits of Fed knowledge about the economy).

The Relevance of Federal Reserve Surplus Capital for Current Policy

Marvin Goodfriend | March 17, 2014


Surplus capital is employed in commercial enterprises as a reserve for contingencies such as absorbing losses or meeting expenses and dividends when earnings are low. The Fed has employed its surplus capital in a similar manner. Prior to the 2007-09 credit turmoil, the most important contingencies were exchange rate revaluations of foreign-currency-denominated securities that the Fed held for its own account. Since these have been marked to market on a regular basis, an appreciation of the foreign exchange value of the dollar would reduce the dollar value of the Fed’s foreign-security holdings

Achieving Normalcy in Monetary Policy

Mickey D. Levy | March 17, 2014

Economic performance continues to improve and in most regards has moved close to normal, but the Federal Reserve’s monetary policy remains far from normal. As the Fed tapers its asset purchases, it relies on forward guidance as a vehicle for artificially suppressing real interest rates even though the economy is in its fifth consecutive year of expansion and unemployment is declining. 


Economics21 Event with Vanderbilt University Professor Brian Fitzpatrick and Center for Class Action Fairness Founder & President Ted Frank. 

The Spring 2014 Shadow Open Market Committee Meeting featured six papers and a presentation by Martin Feldstein, the George F. Baker Professor of Economics at Harvard University and President Emeritus of the National Bureau of Economic Research. Discussion centered around the future of the...

City Journal associate editor Matthew Hennessey and Jared Meyer, policy analyst at Economics21, discuss movie tax credits.