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Speech
Financial Stability Factors and the Severity of the Current Recession [UBS European Virtual Conference]
Economic shocks happen, but the severity of the consequences depends on how fragile, or susceptible to financial instability, the economy was prior to the shock. In the U.S., excessive risk-taking behavior prior to COVID-19 is likely to delay the recovery, even though the initial response by fiscal and monetary policymakers was a prompt and substantial mitigant.
Speech
Financial Stability Factors and the Severity of the Current Recession [Annual Robert Glauber Lecture]
With many central banks focused on keeping interest rates low for an extended period to achieve their mandates – for example in the last recovery – it is particularly important to watch for reaching-for-yield behavior and excessive risk-taking. Easy monetary policy requires more guardrails protecting against rising financial stability risks. Without financial stability governance and tools, recessions have the potential to be more severe and fall disproportionately on those that can least afford it. And the recessions are likely to be deeper and longer, requiring more fiscal and monetary ...
Speech
The past and future of supervisory stress testing design: remarks at the 2018 Federal Reserve Stress Testing Research Conference, Federal Reserve Bank of Boston
Remarks at the 2018 Federal Reserve Stress Testing Research Conference, Federal Reserve Bank of Boston, Boston.
Working Paper
On the Structural Interpretation of the Smets-Wouters “Risk Premium” Shock
This article shows that the "risk premium" shock in Smets and Wouters (2007) can be interpreted as a structural shock to the demand for safe and liquid assets such as short-term US Treasury securities. Several implications of this interpretation are discussed.