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3231. Regime Switching in the Dynamic Relationship between the Federal Funds Rate and Innovations in Nonborrowed Reserves

Author:
Chan Huh
Publication Date:
01-1996
Content Type:
Working Paper
Institution:
Board of Governors of the Federal Reserve System
Abstract:
This paper examines the dynamic relationship between changes in the finds rate and nonborrowed reserves within a reduced form framework that allows the relationship to have WO distinct patterns over time. A regime switching model a la Hamilton (1989) is estimated. On average, CPI inflation has been significantly higher in the regime and volatile changes in funds rate. Innovations in money growth are characterized by large associated with a strong anticipated inflation effect in this high inflation regime, and a moderate liquidity effect in the low inflation regime. Furthermore, an identical money innovation generates a much bigger increase in the interest rate during a transition period from the low to high inflation regime than during a steady high inflation period. This accords well with economic intuition since the transition period is when the anticipated inflation effect initially gets incorporated into the interest rate. The converse also holds. That is, the liquidity effect becomes stronger when the economy leaves a high inflation regime period and enters a low inflation regime period.
Topic:
International Relations, Development, Economics, and International Trade and Finance

3232. The Carter Administration and Latin America: A Test of Principle

Author:
Robert Pastor
Publication Date:
07-1992
Content Type:
Working Paper
Institution:
The Carter Center
Abstract:
Within a single year, two events unprecedented in the history of the United States shook the nation's confidence in itself as the moral leader of the Free World. In August 1974, the president resigned under a pall of scandal, and eight months later, the United States suffered the humiliation of military defeat as it watched the U.S. ambassador to Vietnam fold the American flag under his arm and flee his post by helicopter.
Topic:
International Relations, Foreign Policy, and Human Rights
Political Geography:
United States, Vietnam, South America, Latin America, Central America, Caribbean, and North America

3233. Why Do Some Legislators Go To Court? - Congress and the Lawsuit against President Reagan for Noncompliance with the War Powers Resolution

Author:
Jesus Velasco
Publication Date:
01-1992
Content Type:
Working Paper
Institution:
Centro de Investigación y Docencia Económicas
Abstract:
During the late 1960s and early 1970s, the U.S. Congress became very concerned about the increasing role played by the President in foreign affairs. On November 7, 1973, and as a mechanism to diminish the power achieved by the Chief Executive in international matters, Congress passed the War Powers Resolution (WPR) over Richard Nixon's veto. The basic aim of the law was to prevent the President from unilaterally introducing the armed forces abroad without congressional authorization. In so doing, Congress sought "to fulfill the intent of the framers of the American Constitution."
Topic:
Conflict Resolution, International Relations, and Government
Political Geography:
United States