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following this statement to its logical implications, if they lower interest rates even further below a Taylor Rule, then that would be deflationary since less

following this statement to its logical implications, if they lower interest rates even further below a Taylor Rule, then that would be deflationary since less money would find its way back into the economy and fuel inflation? by not printing money they are printing money or something..cough...tell me you don't understand monetary policy without telling me you don't understand monetary policy. the money they lose when rates go up is of no more significance than the profits they make when they create high-powered reserves. everything on the Fed's balance sheet is outside the real economy. what matters to the real economy is the current nominal and real interest rates and the expectations for where they are going. net income (as opposed to cash flow) is mostly a fiction in general but all the more so when it's the Fed. these stories amount to "boo! OMG big numbers! Zurg say stop doing economics, they have played us for absolute fools" https://ifunny.co/picture/stop-doing-economics-eyears-of-yet-economists-cannot-predict-recessions-bNTPGGKKA https://ifunny.co/picture/stop-doing-economics-eyears-of-yet...

jarym 4y ago
> Fed losses from its interest-rate-risk exposures—unrecognized taxpayer losses—are now being realized in ways Congress never intended and at magnitudes neither the Congress nor the Fed ever expected. When things happen that congress or the Fed never expected (aka the 'experts' and 'planners' in all this)... that should ring alarm bells. Those saying 'nothing to worry about' are putting on a brave face. Shouldn't need to understand economics to see that much.
- RockyMcNuts 4y ago
  like an army of MIT PhDs didn't model obvious 1st-order effects literally everyone who knew anything expected it, it's built into every model what is supposed to happen if the Fed reports book losses or negative equity. hard to go bankrupt if you can literally print money. stupidest FUD and agitprop and unfortunately typical of the WSJ opinion section

jarym 4y ago

> Fed losses from its interest-rate-risk exposures—unrecognized taxpayer losses—are now being realized in ways Congress never intended and at magnitudes neither the Congress nor the Fed ever expected. When things happen that congress or the Fed never expected (aka the 'experts' and 'planners' in all this)... that should ring alarm bells. Those saying 'nothing to worry about' are putting on a brave face. Shouldn't need to understand economics to see that much.

RockyMcNuts 4y ago
like an army of MIT PhDs didn't model obvious 1st-order effects literally everyone who knew anything expected it, it's built into every model what is supposed to happen if the Fed reports book losses or negative equity. hard to go bankrupt if you can literally print money. stupidest FUD and agitprop and unfortunately typical of the WSJ opinion section