Federal Reserve

7:52am

Tue March 6, 2012
Business

Did The Fed Help Banks While Ignoring The Risks?

Originally published on Tue March 6, 2012 12:05 pm

The Federal Reserve shrugged off warnings and let banks pay shareholders billions of dollars in dividends, ProPublica investigative reporter Jesse Eisinger says.
Karen Bleier AFP/Getty Images

Since the financial crisis of 2008, the Federal Reserve has shrugged off warnings and let the largest U.S. financial firms pay tens of billions of dollars in dividends to shareholders, instead of putting aside money as capital in case a new financial crisis hits.

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1:25am

Wed February 29, 2012
Economy

Record Low Interest Rates Raise Inflation Concerns

The Federal Reserve plans to keep short-term interest rates near zero until 2014, and some critics are concerned about the risk of inflation and the message it sends about the economy.
Karen Bleier AFP/Getty Images

The goal of the Federal Reserve's low interest rate policy is to juice the economic recovery. The low rates should make it easier for people to borrow money, which they'll hopefully spend; the increased demand for goods and services is then supposed to translate into more hiring.

That's what the Fed is banking on. It hopes low interest rates will help with its mandate of achieving maximum employment, but it also has another mandate: to keep prices stable.

"In many cases, those two conflict," says economist Joe Gagnon of the Peterson Institute for International Economics.

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7:32am

Wed February 15, 2012
The Two-Way

U.S. Factories Boost Output In January

Manufacturing output increased 0.7 percent in January, the Federal Reserve announced today, adding that it had revised December's number sharply upward to 1.5 percent.

The AP reports that December number was the biggest gain since Dec. 2006. The AP adds:

"Overall industrial production, which includes output by mines and utilities as well as factories, was unchanged in January.

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11:53am

Fri February 3, 2012
Economy

Have Economists Got It Wrong About The U.S.?

Originally published on Fri June 22, 2012 9:23 am

Federal Reserve Chairman Ben Bernanke pauses during a hearing before the House Budget Committee on Feb. 28, 2007.
Alex Wong Getty Images

Five years ago, a subprime mortgage firestorm was melting down the U.S. economy, but most analysts didn't see it happening.

Federal Reserve Chairman Ben Bernanke, testifying before Congress in February 2007, said the housing sector "is a concern, but at this point we don't see it as being a broad financial concern or a major factor in assessing the course of the economy."

If he and the vast majority of economists were blind to the economic and financial calamity taking shape then, could they also be missing the start of a huge economic boom now?

A boom? Really?

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10:45am

Wed January 25, 2012
The Two-Way

Fed: Economy Is 'Expanding Moderately,' But No Change In Rates

Originally published on Wed January 25, 2012 1:24 pm

Federal Reserve Chairman Ben Bernanke during his news conference this afternoon.
Win McNamee Getty Images

The economy "has been expanding moderately, notwithstanding some slowing in global growth" in recent weeks, the Federal Reserve just reported.

In a statement timed for release at the end of their most recent meetings, Fed policymakers also said they expect economic growth in coming quarters "to be modest," that the jobless rate will "decline only gradually" and that inflation will run "at ... or below" levels the central bank wants to see.

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