Federal Reserve

Inflation Expectations Rising?

According to Reuters, investors are beginning to pour more money into Treasury Inflation-Protected Securities (TIPS). These are special Treasury bonds that are designed to protect investors against inflation risk. Granted, part of the reason for the increase could be that in the current zero interest rate environment there is a constant search for greater yield,…

Dear Mrs. Yellen: Get A Real Job

This past weekend saw the Federal Reserve’s annual Jackson Hole summit take place, an event sponsored by the Kansas City Fed that draws top Fed officials along with the world’s top central bankers. It has become a central bank retreat of sorts, an opportunity for the central banking elites to meet and talk in relative…

No Bank Account For You!

An ATM with bars over it.

Via Coindesk comes news of a Bitcoin ATM operator forced to close their business because they were unable to find a bank that would provide them with an account. This is a real danger to the mainstream viability of Bitcoin. Without access to the banking system, Bitcoin is unable to be converted into other currencies, something which will hamper more widespread acceptance of the currency among the general population. In order for Bitcoin to be converted into and out of fiat currency, banks will either have to offer accounts to Bitcoin businesses or Bitcoin businesses themselves will have to become banks and offer banking services. Obviously the former is easier than the latter.

Here’s the Mobile Payment

Smartphone being used to make a mobile payment at point of sale.

The Atlanta Fed wants to know: “Where’s the Mobile Payment?” Well, as anyone who has ever used Bitcoin can tell you, mobile payment is one of Bitcoin’s strengths. Take, for example, the case of Mission Market, an upscale convenience store in Fullerton, CA, which accepts Bitcoin as payment at point of sale (POS). Ring up your items, tell them that you want to pay with Bitcoin, and the POS tablet displays a QR code. Swipe it with your smartphone and Bitcoin will be debited from your account and credited to Mission Market’s account. Quick, easy, painless. No cash to change hands, no credit card bill to pay at the end of the month.

Alan Greenspan: Still in the Dark

Former Federal Reserve Chairman Alan Greenspan

Former Federal Reserve Chairman Alan Greenspan is coming out with a new book this fall. The title of the book, “The Map and the Territory”, is as descriptive of the book’s subject material as Chairman Greenspan’s Congressional testimony always was of the Federal Reserve’s conduct of monetary policy. We’ll assume that Greenspan in his old age hasn’t taken up geography as a side hobby. In advance of the book’s release, the Chairman gave an interview to Marketwatch late last week. Many of the excerpts published online are typical Greenspan, giving vague answers, answering questions that he wanted to answer rather than what was asked, etc.

Yellen’s Message to Congress

Janet Yellen testifies before the Senate Banking Committee during the Semiannual Monetary Policy Report to the Congress.

Federal Reserve Chairman Janet Yellen recently completed her semiannual round of testimony in front of the Senate Banking Committee and the House Financial Services Committee. As at most Congressional hearings, the testimony itself was largely a rehashing of previously-made statements and the real meaty responses were expected in the question and answer session.

But even at hearings as important as these, the questions themselves were largely uninspiring, many revolving around the same theme of “Madame Chairman, don’t you agree that if the Federal Reserve and/or the federal government don’t do what I or my political party want to do that the country will be ruined?” And because many of the questions didn’t specifically revolve around monetary policy, most of the answers didn’t either. Nevertheless, there were a few interesting observations.