The Federal Reserve Bank of New York works to promote sound and well-functioning financial systems and markets through its provision of industry and payment services, advancement of infrastructure reform in key markets and training and educational support to international institutions.
The Outreach & Education function engages, empowers and educates the public in the Second District. Our outreach mission furthers the Bank’s commitment to the region by listening to the communities we serve and developing programs, analysis and sponsored conferences and clinics to help meet their needs. Our education mission aims to advance public knowledge about the Federal Reserve System and its role in the economy.
In this post, the Bank’s Research director introduces a new option for keeping up with our economists’ work—the Economic Research Tracker for Apple iPad. We invite readers to download the app and begin exploring bylines and topics of interest.
The Minimum Return Guarantee (MRG), a peer-based underperformance penalty among Colombian pension fund managers, is intended to protect the interests of pension-fund beneficiaries by limiting unnecessary risk taking by fund managers. However, the bloggers find that by relying on a benchmark based on peer returns, the regulation incentivizes herding behavior.
Mary Roebling (1904-94) was the first woman to serve as president of a major U.S. bank and the first woman governor of the American Stock Exchange, among numerous other honors. Before the 75th anniversary of her bank, the Trenton Trust, Mrs. Roebling had 200 commemorative mechanical banks made in her image!
The Phillips curve denotes an inverse relationship between inflation and some measure of economic slack. A much-discussed issue in the literature is how forward-looking this relationship is. In this post, the bloggers address this question using a flexible version of the New Keynesian Phillips curve (NKPC) to illustrate the key role that expectations play in inflation dynamics.
The bloggers find that banks with higher operating costs—in the form of extraneous services and benefits provided by bank branches—do attract more core deposits and pay less for their funding, but they also make lower-quality loans, on average, and thus have riskier loan portfolios.
The New York Fed’s Research Group is looking for talented individuals with a background in economics, mathematics, or statistics. We are now accepting applications for the RA position with a summer 2016 start date.
In the September Survey, manufacturers and service firms were asked how much their overall selling prices had changed over the past year and how much they expected their prices to rise or fall in the year ahead.
Our 2015 survey finds U.S. households remain broadly optimistic about the housing market. Most renters report that they would rather own than rent if they had the necessary financial resources. As in last year’s survey, a majority believe that it would be difficult to obtain a mortgage, although responses suggest a slight easing in perceived credit access.
As the annual supervisory stress test processes have evolved, the Federal Reserve has provided increasingly detailed public disclosures about the tests’ results and implications. This paper evaluates how the publication of this official sector analysis affects private investors’ assessments of the tested bank holding companies’ values.
By Mark Flannery, Beverly Hirtle, and Anna Kovner, Staff Reports 744, October 2015
The authors document empirically that banks base their balance sheet management on book equity and book leverage. They also present evidence that balance sheet management of intermediaries is linked to market risk, which directly affects firms’ ability to take on leverage.
By Tobias Adrian, Nina Boyarchenko, and Hyun Song Shin, Staff Reports 743, October 2015
This paper presents a macroprudential tabletop exercise designed to provide Federal Reserve Bank Presidents with a plausible, albeit hypothetical, macro-financial scenario that would lend itself to macroprudential considerations. It describes the hypothetical macro-financial scenario, the set of macroprudential tools, their transmission mechanism, as well as an account of the participants’ assessment of vulnerabilities and potential policy actions under the scenario.
By Tobias Adrian, Patrick de Fontnouvelle, Emily Yang, and Andrei Zlate, Staff Reports 742, October 2015
The authors measure the dynamic response of real prices, sales, production, and inventories to changes in real interest rates for a particular durable goods market—new cars and light trucks. This is an important issue because the market for durable goods is a key channel through which monetary policy affects the real economy.
By Adam Copeland, George Hall, and Louis Maccini, Staff Reports 741, September 2015
The authors present the institutional structure of the U.S. repo and securities lending markets and describe the market landscape, the role of the participants, and other characteristics, including how repo and securities lending activity has changed since the 2007-09 financial crisis. They then discuss vulnerabilities in the repo and short-term wholesale funding markets and efforts to limit potential systemic risks.
By Viktoria Baklanova, Adam Copeland, and Rebecca McCaughrin, Staff Reports 740, September 2015
For children whose households are in the lowest quintile of the U.S. income distribution, nearly half of high school graduates do not enroll in college. Given the robust return associated with a college degree, as well as college tuition subsidies for lower-income households, these patterns continue to puzzle researchers and policymakers alike. This paper focuses on information constraints as one possible explanation for these patterns.
By Zachary Bleemer and Basit Zafar, Staff Reports 739, September 2015