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Daily Archives: September 23, 2013

Reflections on the Economic Outlook and the Implications for Monetary Policy

William C. Dudley, President and Chief Executive Officer, Federal Reserve Bank of New York – Remarks at Fordham Wall Street Council, Fordham University Graduate School of Business, New York City, As prepared for delivery: “…This morning my remarks will focus on the U.S. economic outlook.  I am also going to discuss a new tool that the New York Fed will  begin to test—an overnight, fixed-rate full allotment reverse repo facility.  I want to dispel any misconceptions about why we are doing this testing.  The introduction of this facility is not a precursor to a change in the stance of monetary policy.  Instead, the goal of this new facility is to improve our control over overnight interest rates to aid us in the implementation of monetary policy…Let me start by summarizing my main points regarding the economic outlook.  In my view, the economy is slowly healing.  But, while significant progress has been made since the end of the recession, there remain a number of headwinds that have offset the improvement in the underlying fundamentals.  As a result, we have yet to see any meaningful pickup in the economy’s forward momentum. The most notable recent headwind, of course, has been the large amount of fiscal drag this year from the payroll and income tax increases and the budget sequester.  Also noteworthy is the tightening of financial market conditions that has occurred since May.  As we move into 2014, the fiscal headwinds should abate somewhat.  As that occurs, the improving underlying fundamentals of the economy should begin to dominate, pushing up the overall growth rate.  But this is just a forecast, it has not been realized yet.  That is one reason why I supported the FOMC’s decision last week to maintain the current pace of our Treasury and mortgage-backed security purchases.  In my view, the economy still needs the support of a very accommodative monetary policy.  Adjustments to that policy need to be anchored in an assessment of how the economy is actually performing, how financial conditions are evolving, and how this affects the longer-term outlook and the risks around it. Our decisions on how to adjust our policy tools—for example, the pace of asset purchases and forward guidance with respect to the level of short-term rates—must be rooted in the ongoing flow of information that informs our judgments about the prospects for a sustainable recovery.  Decisions on the pace of asset purchase and forward guidance must be based on what is most appropriate to achieve our dual mandate objectives of maximum sustainable employment in a context of price stability.”

U.S. Intelligence: Hiding of Military Assets by “Rogue Nations” and Other States a Major Security Challenge for 21st Century

“While the focus on Syria’s chemical weapons use, and the possibility of military action against Syrian government targets pushed aside, for a while, the issue of how to deal with Iran’s nuclear program, the two situations have one thing in common — their reported reliance on underground facilities to shield the production and storage of… Continue Reading

Cybersecurity: Authoritative Reports and Resources

Cybersecurity: Authoritative Reports and Resources. Rita Tehan, Information Research Specialist, September 20, 2013 “Cybersecurity vulnerabilities challenge governments, businesses, and individuals worldwide. Attacks have been initiated by individuals, as well as countries. Targets have included government networks, military defenses, companies, or political organizations, depending upon whether the attacker was seeking military intelligence, conducting diplomatic or industrial… Continue Reading

CRS – Reaching the Debt Limit

Reaching the Debt Limit: Background and Potential Effects on Government Operations, September 19, 2013 “The gross federal debt, which represents the federal government’s total outstanding debt, consists of (1) debt held by the public and (2) debt held in government accounts, also known as intragovernmental debt. Federal government borrowing increases for two primary reasons: (1)… Continue Reading

Synthetic Drugs: Overview and Issues for Congress

CRS – Synthetic Drugs: Overview and Issues for Congress, September 16, 2013. “Synthetic drugs, as opposed to natural drugs, are chemically produced in a laboratory. Their chemical structure can be either identical to or different from naturally occurring drugs, and their effects are designed to mimic or even enhance those of natural drugs. When produced… Continue Reading

New GAO Reports – Automatic IRAs, Corporate Tax Compliance, National Airspace System, Oil and Gas Development, ICBM Modernization

AUTOMATIC IRAS – Lower-Earning Households Could Realize Increases in Retirement Income, GAO-13-699, Aug 23, 2013 CORPORATE TAX COMPLIANCE – IRS Should Determine Whether Its Streamlined Corporate Audit Process Is Meeting Its Goals, GAO-13-662, Aug 22, 2013 NATIONAL AIRSPACE SYSTEM – Improved Budgeting Could Help FAA Better Determine Future Operations and Maintenance Priorities, GAO-13-693, Aug 22, 2013 OIL AND GAS DEVELOPMENT – BLM… Continue Reading

Arsenic Nation

Deborah Blum: “For my New York Times column, Poison Pen, I wrote this week about arsenic in drinking water, or more specifically on the increasing scientific awareness that this element  – odorless, tasteless – is slowly being revealed as major public health threat. The focus of that piece is the way that arsenic, in the part-per-billion… Continue Reading

Population Decline of Unauthorized Immigrants Stalls, May Have Reversed

“The sharp decline in the U.S. unauthorized immigrant population that accompanied the Great Recession has bottomed out, and the number may be rising again. An estimated 11.7 million unauthorized immigrants were living in the U.S. in March 2012, according to a new preliminary Pew Research Center estimate. Different trends appear among the six states in… Continue Reading