Economic Letter
Brief summaries of SF Fed economic research that explain in reader-friendly terms what our work means for the people we serve.
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Cities and Growth
Kelly Ragan and Bharat Trehan
The study of economic growth is an important part of economics. Traditionally, economists have attempted to understand the process of growth at the level of the aggregate economy, focusing, for example, on concepts such as the economy-wide levels of saving or of education.
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Could Russia Have Learned from China?
Kenneth Kasa
Just as October is the month for stock market crashes, it seems July must be the month for currency crises. Last year, of course, witnessed the collapse of several Southeast Asian currencies, with a fallout that is still being felt.
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How Do Currency Crises Spread?
Reuven Glick and Andrew Rose
The world has experienced three waves of speculative attacks on fixed exchange rate regimes recently: the European Monetary System (EMS) crisis of 1992-93, the Mexican meltdown and “Tequila Hangover” of 1994-95, and the “Asian Flu” of 1997-98. These currency crises generally involved countries in the same region. Why?
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What Caused East Asia’s Financial Crisis?
Ramon Moreno
The collapse of the Thai baht in July 1997 was followed by an unprecedented financial crisis in East Asia, from which these economies are still struggling to recover. A great deal of effort has been devoted to trying to understand its causes.
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New View of Bank Consolidation
Fred Furlong
Consolidation has dramatically altered the structure of banking in the U.S. Since the mid-1980s, the number of banks has plummeted, and larger banks spanning ever wider geographic areas have become more prevalent.
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Capital Flows and Exchange Rates in the Pacific Basin
Reuven Glick
The greater integration of emerging market countries with international capital markets has brought problems as well as benefits for recipients. On the one hand, access to foreign funds has helped finance economic development.
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The Separation of Banking and Commerce
John Krainer
On May 13, the House of Representatives passed H.R.10 and took the nation one step further towards financial service reform. If passed by the Senate and signed by the President, this bill would dismantle part of the Depression-era Glass-Steagall Act by bringing down the barriers preventing unions between banks, securities firms, and insurance firms.
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The Baby Boom, the Baby Bust, and Asset Markets
Timothy Cogley and Heather Royer
In about 10 to 15 years, the first wave of post-war baby boomers will begin to retire, and we will start to see a large generational shift from young to old. This generational shift is illustrated in Figure 1, which shows the expected path of the so-called “old-age dependency ratio,” which is defined as the number of people aged 65 and older divided by the working population (those aged 20 to 64).
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Does the Stock Market Prefer Republican Administrations?
James Booth and Lena Chua Booth
There’s an old adage that a Republican in the White House means higher stock market returns. This adage derives from the generally held view that policies promoted by Republicans are more favorable to stock markets and capital formation.
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U.S. Inflation Targeting: Pro and Con
Glenn D. Rudebusch and Carl E. Walsh
In recent years, monetary economists and central bankers have expressed growing interest in inflation targeting as a framework for implementing monetary policy. Explicit inflation targeting has been adopted by a number of central banks around the world, including those in Australia, Canada, Finland, Israel, New Zealand, Spain, Sweden, and the U.K.