Opening the New York Fed’s 2010 Blackbooks

The transcript discusses the Federal Reserve's economic concerns in 2010, focusing on inflation and deflation dynamics. It explores policy proposals, including quantitative easing (QE) and price-level targeting. The New York Fed's influence is highlighted, along with counterfactual scenarios regarding economic outcomes. The discussion reflects on the Fed's strategies and the potential impact of different approaches.

What was a major concern for the Federal Reserve at the beginning of 2010?

• Runaway inflation due to excess reserves

• High unemployment rates

• Stock market volatility

• Deflationary pressures

What event in 2010 shifted the Federal Reserve's concern from inflation to deflation?

• The European banking crisis

• The rise in oil prices

• The Greek debt crisis

• The housing market crash

What was the initial approach to QE2 by the Federal Reserve?

• Reducing interest rates to zero

• Targeting a specific inflation rate

• A fixed amount of $600 billion

• Open-ended bond buying

What concept was proposed but not adopted by the Federal Reserve, which involves making up for inflation target misses?

• Exchange rate targeting

• Monetary base targeting

• Price-level targeting

• Interest rate targeting

Who was credited with the 'whatever it takes' strategy to save the Euro?

• Janet Yellen

• Bill Dudley

• Ben Bernanke

• Mario Draghi

What was a significant concern for investors according to the New York Fed during the 2010 discussions?

• Rising interest rates

• Currency devaluation

• High unemployment

• Runaway inflation

What was the potential benefit of starting open-ended QE in 2010 according to the discussion?

• Stabilizing the housing market

• Reducing the need for future bond purchases

• Increasing interest rates

• Decreasing unemployment