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Working Paper
Mobility and Engagement Following the SARS-Cov-2 Outbreak
We develop a Mobility and Engagement Index (MEI) based on a range of mobility metrics from Safegraph geolocation data, and validate the index with mobility data from Google and Unacast. We construct MEIs at the county, MSA, state and nationwide level, and link these measures to indicators of economic activity. According to our measures, the bulk of sheltering-in-place and social disengagement occurred during the week of March 15 and simultaneously across the U.S. At the national peak of the decline in mobility in early April, localities that engaged in a 10% larger decrease in mobility than ...
Journal Article
Blockchain Technology Disrupting Traditional Records Systems
Working Paper
Macroeconomic news and asset prices before and after the zero lower bound
With short-term policy interest rates constrained by their effective zero lower bound (ZLB), monetary policy relied on communicating the future path of policy conditional on incoming macroeconomic data. Motivated by this, we exploit intra-day prices to investigate how updates on the state of the U.S. economy affect interest rates and exchange rates before and after the ZLB. We find that releases reflecting the dual mandate of the Fed rose in importance and ? as an ex-post acknowledgement of the sources of the Great Recession ? additional housing market indicators and GDP revisions, that ...
Journal Article
The Macroeconomic Fallout of Shutting Down the Banking System
During the 2008–09 financial crisis, the U.S. government arranged bailouts of major banks to prevent a suspension of bank deposits, where banks cease paying checks and refuse depositors’ requests to withdraw funds. Although these bailouts likely helped firms and households continue to make payments, they have been debated due to potential moral hazard concerns as well as the high cost to taxpayers. Assessing the costs and benefits of preventing deposit suspensions is difficult, as nationwide bank suspensions have not occurred since the Great Depression.To circumvent this challenge, Qian ...
Report
Regulatory Burden Rising
U.S. commercial banks face growing regulatory requirements and complexity, especially with the Dodd?Frank Wall Street Reform and Consumer Protection Act of 2010, which was intended to rein in excesses of the largest banks. The nation would be better served by a regulatory framework that more fully accounts for the operational differences between small and large banks.
Dallas Fed Mobility and Engagement Index Gives Insight into COVID-19’s Economic Impact
To gain insight into the economic impact of the pandemic, we developed an index of mobility and engagement, based on geolocation data collected from a large sample of mobile devices.
Journal Article
Liquidity mismatch helps predict bank failure and distress
Liquidity mismatch?the risk of a bank being unable to fund increases in assets or meet its obligations as they come due?increased in the U.S. banking sector during the run-up to the financial crisis, especially at the largest institutions, contributing to bank failure and distress.
Journal Article
Impact of Macroeconomic Surprises Changed After Zero Lower Bound
Macroeconomic surprises involving employment and inflation?reflecting the Fed?s attempts to achieve its dual mandate to promote full employment and price stability?increased in importance during the zero-lower-bound period. Also, market participants were more attentive to housing market indicators and final GDP revisions.
Working Paper
Why are big banks getting bigger?
The U.S. banking sector has become substantially more concentrated since the 1990s, raising questions about both the causes and implications of this consolidation. We address these questions using nonparametric empirical methods that characterize dynamic power law distributions in terms of two shaping factors ? the reversion rates (a measure of crosssectional mean reversion) and idiosyncratic volatilities of assets for different size-ranked banks. Using quarterly data for subsidiary commercial banks and thrifts and their parent bank-holding companies, we show that the greater concentration of ...
In Uncertain Times, Fed Sometimes Turns to ‘Insurance’
In June 2019, a concept appeared in the Federal Open Market Committee (FOMC) minutes that had not shown up in FOMC minutes for 11 years—the idea of monetary policy “insurance.”