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Anat Admati on the Perils of Corporate Debt and How COVID-19 Relief Efforts Have Gone Wrong

Macro Musings with David Beckworth

Release Date: 05/06/2020

Stephen Kirchner on Australian Monetary Policy in the Wake of the Great Recession show art Stephen Kirchner on Australian Monetary Policy in the Wake of the Great Recession

Macro Musings with David Beckworth

Stephen Kirchner is a program director for trade and investment at the United States Center at the University of Sydney, and he was written widely on financial markets and economy policy in Australia. Stephen joins Macro Musings to talk about the journey of monetary policy in Australia that has transpired throughout the last few decades. Specifically, David and Stephen discuss the structure of the Reserve Bank of the Australia, the history of its inflation target, how Australia was able to avoid the worst of the Great Recession, and the actions they have taken to in response to the COVID...

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Darrell Duffie is a professor of finance at Stanford University, and he joins Macro Musings to discuss the treasury market problems that emerged in March 2020 and what can be done to avoid them in the future. Specifically, Darrell and David lay out the current state of financial markets, the ability of treasury markets, as currently designed, to handle demand shocks, and how central banking reforms can better ensure financial stability in the future.   Register here for the Cato Institute/Mercatus Center Webinar Series - *A Fed for Next Time: Ideas for a Crisis‐​Ready...

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Macro Musings with David Beckworth

Peter Stella is a former IMF official, where he led the Central Banking and Monetary and Foreign Exchange divisions, and he now hosts a webpage titled *Central Bank Archeology*. Peter is also a former guest of Macro Musings, and rejoins to talk about the COVID-19 crisis, central bank balance sheets, and more. David and Peter also discuss the dangers and challenges of the Fed’s off-balance sheet transactions, how the government should approach crisis financing, and who should be managing the country’s public debt.   The transcript for the episode can be found here:   Peter’s...

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Adam Tooze is a professor of history at Columbia University, and is the author of many books, including his popular account of the 2007-2009 crisis, titled Crashed: How a Decade of Financial Crisis Changed the World. Adam joins David on Macro Musings to discuss the COVID-19 crisis, the Eurozone, and the future of central banking. Specifically, Adam and David break down recent events and risks in the global financial system, the future of the dollar as reserve currency, and the implications of the recent German-Franco debt deal for the Eurozone.   Transcript for the episode can be found...

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Alp Simsek is an associate professor of economics at MIT, and joins Macro Musings to talk about the link between financial markets, uncertainty and the COVID-19 crisis. Specifically, David and Alp discuss the dual absorption problem within financial markets, how supply shocks and demand shocks have inescapably become interwoven phenomenon, and why we should look to using macroprudential policy in the future.   The transcript for the episode can be found here:   Alp’s Twitter: @alpsimsek_econ Alp’s MIT profile:   Related Links:   Bonus segment with Alp:...

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Thomas Hoenig is a former vice chair of the FDIC, former president of the Kansas City Federal Reserve Bank, and is currently a distinguished senior fellow at the Mercatus Center at George Mason University. Tom’s research has focused on the long-term impact of the politicization of financial services, as well as the effects of government grant privileges on market performance. Tom joins David on Macro Musings to talk about COVID-19, the Fed's response to its economic impact, and the current state of banking in the United States.   Transcript for the episode can be found here:  ...

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Lev Menand is a legal scholar at Columbia Law School and has previously worked for the New York Fed, the US Treasury Department, and the Financial Stability Oversight Council (FSOC). Lev Joins Macro Musings to talk about his new paper, *Unappropriated Dollars: The Fed’s Ad Hoc Lending Facilities and the Rules that Govern Them*. Specifically, David and Lev discuss opening up public Fed bank accounts, the importance of liquidity and credit facilities, and how Congress is using the CARES Act to skirt the Fed’s current legal mandates.   Transcript for the episode can be found here: ...

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More Episodes

Anat Admati is a professor of finance and economics at Stanford University, and is well-known for her work on leveraging debt in our financial system and how it makes our economy more susceptible to shocks. She’s also a co-author of the popular book, *The Banker’s New Clothes: What Went Wrong with Banking and What to Do About It*. Anat joins Macro Musings again to talk about the COVID-19 crisis from the debt perspective, how the Fed and Congress have responded so far, and how their relief efforts should have been focused differently.   

 

The transcript for the episode can be found here: https://www.mercatus.org/bridge/tags/macro-musings

 

Anat’s Twitter: @anatadmati

Anat’s website: https://admati.people.stanford.edu/

 

Related Links:

 

Bonus segment with Anat: https://youtu.be/4xHmmgoURqg

 

*The Banker’s New Clothes: What’s Wrong with Banking and What to Do about It* by Anat Admati and Martin Hellwig

https://press.princeton.edu/books/paperback/9780691162386/the-bankers-new-clothes

 

*The Leverage Ratchet Effect* by Anat Admati, Peter DeMarzo, Martin Hellwig, and Paul Pfleiderer

https://onlinelibrary.wiley.com/doi/abs/10.1111/jofi.12588

 

*Macrofinancial History and the New Business Cycle Facts* by Oscar Jorda, Mortiz Schularick, and Alan Taylor

https://www.frbsf.org/economic-research/files/wp2016-23.pdf

 

*Coronavirus Crisis Lays Bare the Risks of Financial Leverage, Again” by Martin Wolf

https://www.ft.com/content/098dcd60-8880-11ea-a01c-a28a3e3fbd33

 

*House of Debt: How They (And You) Caused the Great Recession, and How We Can Prevent It from Happening Again* by Atif Mian and Amir Sufi

https://press.uchicago.edu/ucp/books/book/chicago/H/bo20832545.html

 

*Collateral Frameworks: The Open Secret of Central Banks* by Kjell Nyborg

https://www.cambridge.org/core/books/collateral-frameworks/DE8BACD87F364A66DD496F601BE92FE7

 

*Bankruptcy for Banks: A Sound Concept That Needs Fine-Tuning* by Mark Roe and David Skeel

https://www.nytimes.com/2016/08/17/business/dealbook/bankruptcy-for-banks-a-sound-concept-that-needs-fine-tuning.html

 

David’s blog: macromarketmusings.blogspot.com
David’s Twitter: @DavidBeckworth