Search Results
Speech
Comments on “The Equilibrium Real Funds Rate: Past, Present, and Future.”
It is a real pleasure for me to participate in this year?s Monetary Policy Forum. As an attendee of this event for the past several years, I have been very impressed with the organizers? ability to choose a year in advance the topic that turns out to be the issue policymakers are grappling with at the time the forum rolls around. Once again, the organizers have been able to do this, with the important paper by Jim Hamilton, Ethan Harris, Jan Hatzius, and Ken West. Another example of the value of being forward looking when it comes to monetary policy! In the time I have, I will discuss some of ...
Working Paper
The dollars and sense of bank consolidation
For nearly two decades banks in the United States have consolidated in record numbers--in terms of both frequency and the size of the merging institutions. Rhoades (1996) hypothesizes that the main motivators were increased potential for geographic expansion created by changes in state laws regulating branching and a more favorable antitrust climate. To look for evidence of economic incentives to exploit these improved opportunities for consolidation, the authors examine how consolidation affects expected profit, the riskiness of profit, profit efficiency, market value, market-value ...
Working Paper
Who said large banks don't experience scale economies? Evidence from a risk-return-driven cost function
Earlier studies found little evidence of scale economies at large banks; later studies using data from the 1990s uncovered such evidence, providing a rationale for very large banks seen worldwide. Using more recent data, the authors estimate scale economies using two production models. The standard risk-neutral model finds little evidence of scale economies. The model using more general risk preferences and endogenous risk-taking finds large scale economies. The authors show that these economies are not driven by too-big-to-fail considerations. They evaluate the cost implications of breaking ...
Speech
The Economic Outlook and Monetary Policy Loretta J Mester-President and CEO-Federal Reserve Bank of Cleveland-The Forecasters Club of New York-New York, NY-April 16, 2015
Good afternoon. I would like to start by thanking Charlie Steindel and the Forecasters Club of New York for their invitation to speak today. It is a particular pleasure for me to address your group: first, because I have known Charlie for many years ? we both grew up as economists in the Federal Reserve System ? but also because I know I won?t have to explain to you what a difficult task economic forecasting can be, even in the best of times. Still, forecasting is something economists and policymakers must do, so today I will discuss my outlook for the economy and monetary policy. As always, ...
Speech
The Economic Outlook, Monetary Policy, and Normal Policymaking Now and in the Future; 10.25.18 Money Marketeers of New York University, Inc., New York, NY
I thank the Money Marketeers of New York University for inviting me back to speak tonight. When I was here four years ago, I discussed the important role that Federal Reserve communications play in making effective monetary policy and the need for these communications to evolve as we moved from a period of extraordinary monetary policymaking to more normal policymaking. At this point, that transition to more normal policymaking has been underway for some time, reflecting the health of the U.S. economy and the progress that?s been made on the FOMC?s monetary policy goals. Tonight, I?ll talk ...
Speech
Successful Workforce Development Programs: Four Lessons from Four Decades of Federal Reserve Research and Outreach
Workforce development is a crucial ingredient for achieving a healthy and dynamic economy that can work for all. When it comes to the economic well-being of entire regions, many studies have documented the importance of investments in education and training programs. For example, Cleveland Fed researchers found that over a 75-year period, education levels were consistently one of the most reliable indicators for each state’s per capita income growth1 and that counties with higher levels of high school graduates tend to have lower poverty rates and higher levels of labor force ...
Working Paper
Optimal industrial structure in banking
This paper discusses the research agenda on optimal bank productive efficiency and industrial structure. One goal of this agenda is to answer some fundamental questions in financial industry restructuring, such as what motivates bank managers to engage in mergers and acquisitions, and to evaluate the costs and benefits of consolidation, which is essentially an empirical question. The paper reviews the recent literature, including techniques for modeling bank production and the empirical results on scale economies, scope economies, and efficiency in banking.
Speech
Perspectives on the Economy and Monetary Policy at the City Club of Cleveland, Cleveland, Ohio.
Thank you for that kind introduction. And thanks to the City Club for the opportunity to speak today to so many of Cleveland?s business leaders. Since coming to Cleveland last year, I have made it a point to learn more about the city?s many important institutions, and the City Club of Cleveland is certainly a leader among them. It is an honor for me to be included in your list of very distinguished speakers. For more than 100 years, the City Club has fostered the free and open exchange of ideas. It sees value in bringing together people with diverse viewpoints for a civil discussion of a wide ...
Journal Article
Was job quality “job one” in the tri-state region’s economic recovery?
Employment growth has been the most hesitant part of this recovery. Labor markets have been weaker for longer in this recovery than in the other postwar recoveries, even the so-called ?jobless recovery? of 1991-92, at least by some measures.
Speech
Views on the Economy and Monetary Policy: In a Good Place and Ensuring We Reach an Even Better One
Monetary policy is in a good place from which to assess and respond to these risks to the outlook. The current strength in labor market conditions and the strong spending data give us the opportunity to keep the nominal funds rate at its current level while we gather more evidence that inflation truly is on a sustainable and timely path back to 2 percent. This is better than finding ourselves in a situation where we begin easing too soon, undo some of the progress we have made on inflation, potentially destabilize inflation expectations, and then have to reverse course. If the economy evolves ...