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The article reports that i n March 2020, commercial paper markets experienced disruptions related to the outbreak of COVID-19 and its associated shutdowns. Investor flows out of money market funds were exacerbated by uncertainty about the impact of COVID-19 on businesses. Anecdotally, commercial paper investors were unwilling to extend credit to issuers except at very short maturities (less than five days).

The article presents a study which focuses on the Commercial Paper Funding Facility (CPFF) of the U.S. Federal Reserve System, as well as the economic role of the commercial paper market. It says that the commercial paper market is being used by commercial banks and financial institutions to acquire short-term external funding. It also mentions that the CPFF was designed to provide additional source of funding to institutions in order to minimize the reinvestment risk.

Presents an overview and summary of papers presented at the conference held at the Federal Reserve Bank of New York which tackled issues regarding disclosure and market discipline in the banking industry. Interaction between supervisor examinations and market discipline; Relationship between bank disclosure and stock price volatility; Indicators for the determination of troubled banks.

Introduces a series of articles on economics and other related topics.

Lists research papers dealing with economics and finance issues. Includes `A Simple Model of Conflicting Horizons,' by S. Brock Blomberg; `Explaining the Growing Gap Between Low-Skilled and High-Skilled Wages,' by David Brauer and Susan Hickok; `Perspectives on U.S. External Deficits,' by M.A. Akhtar.

The article discusses widespread agreement for both market participants and China's policymakers China's economic growth slowed in 2018. Topics include China plays a dominant role in world demand for key energy, metal, and agricultural commodities; and disagreements on China's business cycle stem from differing views on the reliability and accuracy of China's official economic statistics.

The article "Climate-Related Financial Stability Risks for the United States: Methods and Applications" examines various models used to study climate-related financial stability risks (CRFSRs) in the U.S. It discusses the strengths and weaknesses of ten types of models and their suitability for assessing CRFSRs, noting a high level of uncertainty in current assessments. The text also delves into the methodology of natural capital analysis, emphasizing the importance of measuring firms' exposure to natural resource degradation and the impacts on business models. It concludes by suggesting ways to combine existing methodologies for a more comprehensive understanding of climate risks and vulnerabilities, highlighting the need for further research in integrating climate-related risks into modeling frameworks. [Extracted from the article]

The article offers information on the "The Future of New York City: Charting an Equitable Recovery for All" conference to be held in New York City in March 2022.

The article focuses on the credit default swap (CDS) market, which is the third biggest over-the-counter (OTC) derivatives market in the world. Topics include the CDS trade repository maintained by the Depository Trust and Clearing Corporation (DTCC); CDS is a bilateral agreement between a protection buyer and a protection seller; and CDS contract insures the buyer of protection against a default of a single issuer, such as a corporation, sovereign, or municipality.

The article compares the U.S. and Danish mortgage finance systems. It examines the implications of the structures of the Danish mortgage market for U.S. housing finance reform, including the fact that Danish mortgage banks issue covered bonds collateralized by mortgage loans on a match funded basis. The mortgage credit risk and the interest rate and prepayment risk facing Danish mortgage banks are discussed, as well as the absence an explicit government guarantee in the Danish mortgage market.

Lists research papers on economics and finance. Includes `Taylor, Black and Scholes: Series Approximations and Risk Management Pitfalls,' by Arturo Estrella; `The Evolution and Determinants of Corporate Profits: An International Comparison,' by Merih Uctum; `Perspectives on U.S. External Deficits,' by M.A. Akhtar.

Comments on the papers of Barbara Wolfe and Arline Geronimus with focus on the health consequences of poverty. Questions raised by Wolfe; Consequence of health problems; Concluding remarks.

Opinion. Presents the author's views and comments on the research papers of Jonathan McCarthy and Charles Steindel entitled `National and Regional Factors in the New York Metropolitan Economy and Kenneth N. Kuttner and Argia M. Sbardone's `Sources of New York Employment Fluctuations.' The author's comments on national-regional economic relationship; On McCarthy-Steindel and Kuttner-Sbordone papers; Bet on the future.

The article reports that in the spring of 2020, the Federal Reserve System, in collaboration with the U.S. Treasury, established for the first time a program under which it offered short-term funding to states, localities, and other municipal entities. In this article, we discuss the basic economics of state and local governments and the ways they use debt.

The article presents case studies of several financial markets and institutions. Vulnerabilities and funding mechanism are examined. The mitigation of financial market stress and restoration of liquidity among intermediaries are also evaluated. An overview of the concept of an asset-backed commercial paper is provided.

Presents reactions to the conference papers in relation to economic inequality in the United States. Increase of inequality in the United States; Effect of inequality to society; Policy implications.

Presents a commentary on papers written by James Orr and Richard Peach and Joseph Gyourko and Joseph Tracy with focus on issues related to home ownership. Discussion of the findings; Analysis of the results; Policies to encourage home ownership; Conclusion.

Presents a list of publication and discussion papers produced by the Federal Bank of New York's Research and Market Analysis Groups that will interest policymakers, academics, business and banking professionals and the general public. Topics presented in the discussion papers; World Wide Web site of the magazine `Economic Policy Review' wherein people can avail of the current issues of the magazine.

Information about several papers discussed at the Central Bank Liquidity Tools Conference by the Federal Reserve Bank of New York is presented. Topics include the problems in liquidity provision, funding and market liquidity, and policy responses to illiquidity. It features several speakers including Bengt Holmstrom, Patrick Bolton, and Franklin Allen.

The article discusses some of the issues covered at the May 2006 conference of the Federal Reserve Bank of New York about trends in economic research on systemic risk. The descriptions of systemic events by risk managers at the conference reflected that in times of crisis, everything is correlated. Many of the features of complex systems described by conference participants from the natural and mathematical sciences are present in the financial system.

Comments on an article by Wayne Vroman concerning the unemployment insurance (UI) financing and the 2001 recession in the U.S. Views on UI financing; Issue of severity of the 2001 recession; Ways to assess the extent to which UI counteracts the impact of recessions; Conclusion on the paper of Vroman.

Focuses on the transmission mechanism for monetary policy and the wealth effect on consumption. Assumptions on the changes in the stock market; Effects of deviations from the monetary policy rule; Requirements of a good instrument in the case of the federal funds rate.

Examines the value of the U.S. Federal Reserve Board's Senior Loan Officer Opinion Survey in predicting both lending and output. Background of and motivation behind the survey; Correlation between the changes in commercial credit standards reported by loan officers in the survey and various measures of credit availability; Link between standards and economic activity; Analysis of the impact of a shock to credit standards in a multiple-equation framework.

Presents a commentary on the papers written by Edward Glaser and Matthew Kahn and by Edwin Mills which have a common issue on mobile resources. Positive relationship between population and redistribution; Argument on the long-run policy goal of each city.

Although interbank lending markets play a key role in the financial system, the lack of disaggregated data often makes the analysis of these markets difficult. To address this problem, recent academic papers focusing on unsecured loans of central bank reserves have employed an algorithm in an effort to identify individual transactions that are federal funds loans. he accuracy of the algorithm, however, is not known. he authors of this study conduct a formal test with U.S. data and find that the rate of false positives produced by one of these algorithms is on average 81 percent; the rate of false negatives is 23 percent. These results raise concerns about the information content of the algorithm's output. [ABSTRACT FROM AUTHOR]

The article reports that in March 2020, at the onset of the COVID-19 pandemic, investors redeemed their shares en masse from both domestic and offshore dollar-denominated prime money market funds (MMFs). Relative to the size of the prime MMF industry, the run was remarkably similar to the run that took place in September 2008, during the global financial crisis, notwithstanding the starkly different natures of the shocks that precipitated the two episodes.

During the recent crisis, we observed the failure or near failure of some of the world's largest financial institutions, requiring the regulators to intervene to resolve these institutions. Banks and financial intermediaries perform important functions such as channeling resources from savers to productive projects and providing important payment services to their customers through their money-like liabilities. Hence, their failure can result in costs for the economy and an efficient resolution mechanism can mitigate such costs. In this paper, we provide a discussion of the costs associated with bank failures, the methods used by regulators to resolve banks, and the costs of different methods. Furthermore, we provide a simple framework to analyze the optimality of resolution methods. We show that while private resolution methods, such as sale to a healthy bank, are preferred options, they may not be feasible during systemic crises. Hence, regulators need to employ a state-contingent resolution mechanism. Resolution during a systemic crisis entails tradeoffs between disruptions arising from a disorderly liquidation and potential moral hazard resulting from the use of public funds. [ABSTRACT FROM AUTHOR]

An introduction is presented in which the editor discusses various reports within the issue on topics including the two U.S. Federal Reserve Board's lender-of-last-resort (LOLR) facilities, crisis-related liquidity programs, and the impact and implementation of the large-scale asset purchase (LSAP) programs.

The article reports that the Federal Reserve has resorted to statutory authorities that had lain unused for more than seven decades till 2008 when it took steps to improve a financial system on the brink of collapse. The Fed had reportedly been granted these powers in 1932 through passage of the Emergency Relief and Construction Act. It adds that the original Federal Reserve Act of December 23, 1913, incorporated strict limits on the scope of discretionary central bank credit policy.

Talks about the 'Report on Consolidation in the Financial Sector,' from the Group of Ten, about the effects of financial consolidation on U.S. monetary policy. Possible effects of banking and financial consolidation; Factors affecting changes in the transmission of monetary policy; Effect of monetary policy changes on real gross domestic product.

Discusses the policy implications of the research done by Skander Van den Heuvel, on what he calls the bank capital channel of monetary transmission. Assumptions of the model presented, which focuses exclusively on the link between interest rates and bank capital; Effect of movements in bank capital on loan supply; Impact of a decline in gross domestic product on monetary policy.

Focuses on the credit standards and monetary policy as of May 2002. Reasons credit standards might change; Excerpt from Friedman and Schwartz's 1963 discussion of monetary policy in 1919; Control methods for the endogeneity problem of credit standards; Issues on the measure of credit standards.

Talks about the comovement of house prices with consumption and consumer durables expenditures in Great Britain. Structural change in the retail credit markets and its effect on the pattern of household debt; Outline of the model for the household credit channel; Effects of financial innovation on the monetary transmission mechanism.

Discusses whether changes in the monetary policy shock or its impulse function an important cause of the change in the variability in output. Discussion on the relative stability of the macroeconomy; Changes in the impulse response of monetary policy shocks.

Discusses the issues in value-at-risk modeling and evaluation. Value of value at risk; Horizon problems and extreme events in financial risk management; Methods of evaluating value-at-risk estimates.

Provides information about various publications and discussion papers of interest to policymakers, business and banking professionals and the general public, produced by Federal Bank of New York's Research and Market Analysis Group. Articles which appears in `Economic Policy Review'; Issues in economics and finance which appears in `Current Issues in Economics and Finance' and other publications; Address of Federal's web site.

Opinion. Presents the author's view and comments on the research of McCarthy-Steindel and Kuttner-Sbordone about the metropolitan employment in New York. Overview of the research; Overview of the factor model approach; Suggestions for further analysis; Possible limitations of the analysis; General implications of the study; Conclusion.

The experience of the 2007-09 financial crisis has prompted much consideration of the link between the structure of compensation in financial firms and excessive risk taking by their employees. A key concern has been that compensation design rewards managers for pursuing risky strategies but fails to exact penalties for decision making that leads to bank failures, financial system disruption, government bailouts, and taxpayer losses. As a way to better align management's interests with those of other stakeholders such as creditors and taxpayers, the authors propose a cash holding requirement designed to induce financial firms to adopt a conservative approach to risk taking. Firms meet the requirement by deferring employee compensation in an escrowed cash reserve account. The cash accrues to the earners on a vesting schedule, but is transferred to the firm in times of stress so that it can pay down its debt or otherwise bolster its assets. The cash requirement increases with the leverage of the firm and with the firm's vulnerability to aggregate stress; the authors provide illustrative calculations sizing the proposed cash requirement for many U.S. financial firms over the 2000-13 period. The analysis also compares the role of deferred cash compensation in promoting financial stability with that of other instruments, such as inside debt, deferred equity, and contingent capital. [ABSTRACT FROM AUTHOR]

Reviews the findings of a study which examined the use of market prices in supervising large financial firms. Significance of market information in assessing bank condition; Efforts to use market information to predict future supervisory assessments; Importance of equity data as a valid source of market information.

Analyzes the findings of an empirical study conducted by Ursel Baumann and Erlend Nier which investigated the relationship between bank stock volatility and bank disclosure. Concerns regarding the mandatory disclosure requirements provided for in the proposed Basel II Accord; Findings that disclosure are negatively correlated with stock price volatility; Benefits of disclosure to banks and investors.

The article discusses Chinese GDP growth rates remain impressive compared to seen in developed market economies, the Chinese economy has decelerating the 2007-09 Great Recession. Topics include attribute to data collection and construction issues within statistical authorities at both the local and national levels; and the resulting indicator points to a greater degree of cyclicality in Chinese economic growth than official statistics reflect.

An introduction is presented in which the editor discusses various reports within the issue on topics including the fragility associated with financial institutions, case studies of several major financial markets and intermediaries and market analysis for financial institutions.

The article discusses that the global dash for cash amid the worsening COVID-19 pandemic led to selling pressures across advanced-economy sovereign bond markets, causing market disruptions in March 2020. The authors emphasize that these disruptions were more pronounced and broad-based in the US Treasury market due to differences in leverage dynamics, leading to a heavier buildup of leverage and catalyzing more deleveraging during the COVID-19 shock compared to other sovereign bond markets.

The article discusses various reports published within the issue including one on implications that recent financial developments may have for the fundamental nature of the lender-of-last-resort function of central banks, the potential of changes to the Federal Reserve's discount window borrowing facility to represent a fundamental shift in the provision of liquidity by the Federal Reserve through the primary credit facility, and the role of central banks during the financial turmoil.

The article discusses role of regulations in changes in the U.S. banks. It states that under the Regulation 2a-7 money market mutual funds (MMMFs) were allowed to value their shares. It mentions that in 1968, the government allowed the Government National Mortgage Association (Ginnie Mae) the right to issue mortgage-backed securities (MBS).

The article discusses some of the issues covered at the May 2006 conference of the Federal Reserve Bank of New York about the market for interbank funds and the payments system. A paper, by Adam Ashcraft of the Federal Reserve explored whether trading frictions in the fed funds market affect the reallocation of excess reserves to banks requiring funds to complete their payments. Another presentation describes two approaches for characterizing the nonlocal, systemwide interconnections that may lead to systemic risk.

The article examines the impact of foreign direct investments (FDI) on the financial sectors of both host countries and developing countries. According to the article, real-side and financial sector (FDI) share many features. Bank branches and financial facilities were established while foreign ownership provided additional opportunities such as entry of multinationals, technology transfer, technical efficiency, among others.

Comments on the article "The Weak Jobs Recovery: Whatever Happened to the Great American Jobs Machine?," by Richard B. Freeman and William M. Rodgers III. Reasons behind the weak job creations in the U.S. labor market; Focus of the paper on the distribution of employment and wage changes; Views on structural change.