The theory (and rational) behind Quantitative Easing explained

Originally posted on mirco balatti:
The primary channel through which LSAPs appear to work is the risk premium on the asset being purchased. By purchasing a particular asset, the Federal Reserve reduces the amount of the security that the private sector holds, displacing some investors and reducing the holdings of others, while simultaneously increasing the…

Should central banks stop targeting inflation? Is leadership from elected officials better than the one from politicians?

Should central banks stop targeting inflation?  Is leadership from elected officials better than the one from politicians? Ben Bernanke’s new memoir, The Courage to Act, is a fantastic and reasonably accessible introduction to the economic thought of a former Federal Reserve Chair who was a leading academic economist before serving in government. But it doesn’t…