Federal Reserve Bank of Cleveland

News from the Fed

Cleveland Fed Offers Mortgage Foreclosure Resource Center
This online resource will serve both as a central portal for the Federal Reserve Bank of Cleveland’s work on foreclosure, as well as a means of sharing tools and resources available nationally and regionally with homeowners and community development groups dealing with this issue. Read more

FOMC Statement
The Federal Open Market Committee decided today to keep its target for the federal funds rate at 2 percent. Read more

Federal Reserve Board Issues Final Rule Amending Home Mortgage Provisions of Reg Z (Truth in Lending)
The rule prohibits unfair, abusive, or deceptive home mortgage lending practices. Read more

Federal Reserve Board Grants Federal Reserve Bank of New York Authority to Lend to Fannie Mae and Freddie Mac Should Such Lending Prove Necessary
Read more

Cleveland Federal Reserve Bank Appoints James Savage Vice President of Public Affairs
James Savage has been appointed vice president of public affairs at the Federal Reserve Bank of Cleveland, effective June 30, 2008. Read more

Learn from Past, Plan for Future: Central Bank's Role in Financial Crises Is Focus of Cleveland Federal Reserve Annual Report
Central banks are responsible for fostering financial stability, and that role takes center stage during periods of financial turmoil, such as the subprime mortgage meltdown. The Federal Reserve Bank of Cleveland's 2007 Annual Report essay, "Central Banks & Crisis Management," offers some lessons from the past that may help guide policymakers in planning ahead to manage future financial crises. Read more

Cleveland Federal Reserve Bank Announces Essay Contest Winners
The Federal Reserve Bank of Cleveland announced Joon Seok Yoo, a student at Western Reserve Academy in Hudson, Ohio, as the winner of the Bank's 2008 essay contest for high school students. Read more

Federal Reserve Launches Partnership for Progress
The Federal Reserve System today announced the nationwide launch of Partnership for Progress, an innovative outreach and technical assistance program for minority-owned and de novo institutions. Read more

Community Development Pros Discuss Consumer Finance Policy Change at Cleveland Fed Policy Summit
Nearly 250 community development professionals attended the Federal Reserve Bank of Cleveland’s Sixth Annual Community Development Policy Summit, Consumer Finance: Crossing the Divide, on June 11 and 12. Read more

This free, self-directed activity book teaches the basic concepts of financial decision making in an informative, fun way.

Sandra Pianalto
President and CEO
Bio

05.13.08

Trouble Ahead for Student Loans?
Ozgur Emre Ergungor and Ian Hathaway
The market for student loans may differ in some respects from other financial markets, but private lenders are the primary source of funds. As in other markets, the incentive to lend those funds comes from the ability to make a profit. But recent turmoil in financial markets is affecting all of the factors that contribute to the profitability of student loans, leading to speculation that the availability of such loans will fall. Read more

Another Steady Rate Decision
Charles T Carlstrom and Sarah Wakefield
On August 5, 2008, the Federal Open Market Committee (FOMC) voted to keep its target for the federal funds rate at 2%. The committee’s statement noted that tight credit conditions, the ongoing housing contraction, and elevated energy prices are likely to weigh on economic growth over the next few quarters. However, it added that upside risks to inflation are also of significant concern. Read more

Will We Have Another “Jobless” Recovery?
Paul W Bauer
After the last business cycle peak—still officially March 2001—labor productivity remained strong, but employment took longer than usual to recover. As we continue through another soft economic patch, we might wonder whether labor productivity will be as strong as it was after the last business cycle peak. While this would be good for real wages and living standards in the long run, it could mean a slow recovery in employment growth in the short run. Read more

The Great Moderation: Good Luck, Good Policy, or Less Oil Dependence?
Andrea Pescatori
Three explanations have been suggested for the moderation in real GDP and inflation that has occurred in industrialized countries since the 1980s: good luck, better monetary policy, and structural changes in the economy. Recent research finds that better monetary policy explains most of the moderation in inflation, and good luck and the less-intensive use of oil (a structural change) have played a major role in the moderation of GDP. Read more

Explaining Apparent Changes in the Phillips Curve: The Great Moderation and Monetary Policy
Charles T Carlstrom and Timothy S Fuerst
Observations that the Phillips curve may be deviating from historical norms are important to policymakers because deviations would imply that more or less output has to be sacrificed to achieve a permanent reduction in long-term inflation. But we argue that recent economic shocks and a shift in the Fed’s response to inflation may be leading economists to misestimate the curve. Read more

Explaining Apparent Changes in the Phillips Curve: Trend Inflation Isn't Constant
Charles T Carlstrom and Timothy S Fuerst
Monetary policymakers look to the Phillips curve—an expression of the relationship between inflation and the degree to which the economy is operating relative to its potential—for information about the cost of actions undertaken to lower inflation. Recent estimations of the curve suggest it is deviating from historical norms. We argue that changes in trend inflation and Fed operating procedures are not being taken into account in these estimations and that when they are, changes in the curve are minor and need not concern policymakers. Read more