Recalling that at its last meeting the Federal Open Market Committee said uncertainties surrounding the economic future are unusually high, Federal Reserve Board vice chairman Donald Kohn said the central bank needs to be “nimble” in its policymaking. “My discussion today was intended to highlight some of the issues we will be looking at in financial markets as we weigh the necessity of future actions,” Kohn said yesterday, according to prepared text of his speech released by the Fed. “We will need to assess the implications of these developments, along with the vast array of incoming information on economic activity and prices, for the future path of the U.S. economy. As the Federal Open Market Committee noted at its last meeting, uncertainties about the economic outlook are unusually high right now. In my view, these uncertainties require flexible and pragmatic policymaking — nimble is the adjective I used a few weeks ago.”Dropping the discount rate and allowing term loans from the discount window was not as effective as it could have been because banks view borrowing as a sign of a troubled institution, he said. “The success of such a program lies not in loans extended but rather in the extent to which the existence of this facility helps reassure market participants,” according to the speech’s text. “In that regard, I think we had some success, at least for a time. But the usefulness of the discount window as a source of liquidity has been limited in part by banks’ fears that their borrowing might be mistaken for accessing emergency loans for troubled institutions. This 'stigma’ problem is not peculiar to the United States, and central banks, including the Federal Reserve, need to give some thought to how all their liquidity facilities can remain effective when financial markets are under stress.”
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With billions of federal funding available from the Infrastructure Investment and Jobs Act, one observer says it could be limiting the amount of municipal bonds issued by the sector.
1h ago -
Teague, most recently an executive director of the municipal securities department at Morgan Stanley, will focus on surface transportation.
2h ago -
Steven Mahr moved to Chicago two years ago, and in March, he moved from Stifel to the city's finance department, where he's now happily tackling tough problems.
3h ago -
S&P Global Ratings joined Moody's in assigning a negative outlook to its triple-A rating, but a criteria change pushed Fitch's rating of the city up to AAA.
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Inflows returned to muni mutual funds as investors added $200.3 million for the week ending Wednesday after $1.474 billion of outflows, according to LSEG Lipper.
April 25 -
Democratic Gov. Laura Kelly nixed another tax cut bill passed by the Republican-led legislature this year, while pushing a less-costly plan.
April 25