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The Fed hopes to stop investment bubbles before they pop. Good luck!
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This Link is located in the Public Channel Slate Magazine.
Posted by MyPropsMonkey 1 year 171 days ago (feeds.feedburner.com). Views: 299
Tags: slate politics |
| Related Tags: news election new york times economics video la times election 2008 |
What should the Federal Reserve do—and what can the Federal Reserve do—about investment bubbles? On Friday, the Wall Street Journal profiled a group of Princeton economists who have been hired by current Federal Reserve Chairman Ben Bernanke to study the subject. "The Princeton squad argues that the Fed can and should try to restrain bubbles," the Journal wrote, "rather than following former Chairman Alan Greenspan's approach: watchful waiting while prices rise and then cleaning up the mess after a bubble bursts." In a speech on the same topic last Thursday, Federal Reserve Gov. Frederic Mishkin said that while the Fed probably shouldn't be in the asset-bubble-bursting business, it should have mechanisms in place to stop periodic outbursts of investor insanity from infecting the credit system.
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