Federal Reserve Bank
of San Francisco Federal Reserve Bank
of San Francisco

Economic Letter

Brief summaries of SF Fed economic research that explain in reader-friendly terms what our work means for the people we serve.

  • The Current Strength of the U.S. Banking Sector

    2003-37

    John Krainer and Jose A. Lopez

    During the 2001 recession and the recovery, bank performance has been remarkably strong. To be sure, banks tightened their lending standards as the economy softened, lessening their exposures to problem areas such as the technology and telecommunications sectors.

  • Japanese Foreign Exchange Intervention

    2003-36

    Mark M. Spiegel

    Pacific Basin Notes. This series appears on an occasional basis. It is prepared under the auspices of the Center for Pacific Basin Monetary and Economic Studies within the FRBSF’s Economic Research Department.

  • Monitoring Debt Market Information for Bank Supervisory Purposes

    2003-35

    John Krainer and Jose A. Lopez

    Bank supervisors monitor bank holding companies (BHCs) in order to enforce regulations and gauge their soundness so as to guard against systemic risk in the financial system. This monitoring is chiefly conducted using supervisory resources, such as bank examinations and quarterly filings of balance sheet information.

  • Should the Fed React to the Stock Market?

    2003-34

    Kevin J. Lansing

    The late 1990s witnessed the emergence of the greatest speculative bubble in financial market history. Investors bid up stock prices to unprecedented valuation levels as they extrapolated a temporary surge in corporate earnings growth far into the future.

  • The Bay Area Economy: Down but Not Out

    2003-33

    Mary C. Daly

    After being the quintessential darling of the nation’s economy, the San Francisco Bay Area has been battered by the information technology (IT) downturn; nearly one in ten jobs in the Bay Area has disappeared since the peak of late 2000, and half of those were in the IT sector. This Economic Letter explores the sources of the boom and bust in the Bay Area and puts the region’s recent contraction in the context of the U.S. and other regional IT centers.

  • The Natural Rate of Interest

    2003-32

    John C. Williams

    A key question for monetary policymakers, as well as participants in financial markets, is: “Where are interest rates headed?” In the long run, economists assume that nominal interest rates will tend toward some equilibrium, or “natural,” real rate of interest plus an adjustment for expected long-run inflation.

  • Good News on Twelfth District Banking Market Concentration

    2003-31

    Liz Laderman

    As the banking industry has consolidated in recent years, the number of banking organizations in the U.S. and in the Twelfth Federal Reserve District has declined dramatically. This consolidation trend raises public policy issues because of its implications for concentration and therefore competition in local banking markets.

  • Is Our IT Manufacturing Edge Drifting Overseas?

    2003-30

    Rob Valletta

    The United States arguably is the world’s foremost producer of information technology (IT) products, and for many of these products, the U.S. defines the “leading edge,” or most advanced available technology. Within the U.S., the Twelfth District in particular specializes in IT production. However, amidst the current prolonged slowdown in worldwide IT spending, signs are emerging of a potential erosion of the U.S. competitive advantage.

  • Mortgage Refinancing

    2003-29

    John Krainer and Milton Marquis

    One of the defining characteristics of the 2001 recession was the resilience of consumer expenditures. Many commentators have pointed to the housing market as one source of strength in consumption.

  • Earnings Inequality and Earnings Mobility in the U.S.

    2003-28

    Mary C. Daly

    Rising inequality in individual earnings has been an important feature of the economic landscape in the United States in recent decades. The increased dispersion in yearly earnings has caused some to worry that a more permanent widening of the distribution has occurred.