Category Archives: International Economics

Rules Are Green and Discretion Is Red in the Monetary Game

Raghuram Rajan, Governor of the Reserve Bank of India, is calling for a reform of the international monetary system.  He has been calling attention to problems in the system for a while, and now he is looking for a solution. … Continue reading

Posted in International Economics, Monetary Policy

New Test Finds No Impact of QE on Long-Term Interest Rate

The Fed’s stated purpose of quantitative easing (QE) was to lower long-term interest rates, and many papers have endeavored to test empirically whether it achieved that purpose. Some, such as the paper by Gagnon, Raskin, Remache, and Sack, have looked at … Continue reading

Posted in International Economics, Monetary Policy

A Reawakening of International Monetary Policy Research

International Monetary Stability: Past Present and Future was the topic of this year’s monetary policy conference held last week at Stanford’s Hoover Institution. With highly volatile exchange rates, the spread of unusual monetary policies, and disappointing growth and stability, it … Continue reading

Posted in International Economics, Monetary Policy

Ideas and Action: A Rules-Based Deal for the IMF

Several months ago in Congressional testimony, in a Wall Street Journal article, in meetings with public officials, and in a post on Economics One, I suggested the idea that “There is room for a deal” on an important IMF reform that … Continue reading

Posted in International Economics

Learning from Experiences in International Economic Policy

Last week we had a wonderful symposium in celebration of George Shultz’s 95th birthday. Many of George’s friends and colleagues spoke on the theme “Learning from Experience” in economic policy, security policy, social cohesion, and politics. For my part, I spoke of … Continue reading

Posted in International Economics

Doing Away with Evils in the International Financial System, Again

Seventy years ago President Harry Truman signed the Bretton Woods Agreements Act of 1945, officially creating the IMF and the World Bank. As Treasury Secretary Henry Morgenthau put it, the Bretton Woods agreements aimed to “do away with economic evils.” … Continue reading

Posted in International Economics

Lessons Learned on the 30th Anniversary of the Plaza Accord

The Plaza Accord, which took place 30 years ago this month, provides two important (and fascinating) economic lessons essential for anyone interested in reforming, or simply teaching, the international monetary system.  First, sterilized exchange market interventions are largely ineffective. A … Continue reading

Posted in International Economics

Seeking a Way through the Fog of a Currency War

Many have speculated on the nature of, and the reasons for, the exchange rate regime change in China last week. While the central bank has issued press statements and answered questions about it intentions, it is useful to look at … Continue reading

Posted in International Economics

A Deal and a Step to International Monetary Reform

I make the case in this Wall Street Journal piece and in more detail in Congressional testimony that there’s an opportunity for a deal between the Congress and the Administration on international monetary reform.  The case starts with perhaps the … Continue reading

Posted in Financial Crisis, International Economics

Too Low For Too Long Or Global Saving Glut? Both!

In an interesting new paper, “The U.S. Housing Price Bubble: Bernanke versus Taylor,” forthcoming in Journal of Economics and Business, Abrar Fitwi, Scott Hein, and Jeffrey Mercer examine two possible causes of the housing price boom that preceded the financial … Continue reading

Posted in International Economics, Monetary Policy