Where Does Profit Come from in the Payments Industry?
The recent development in the payments industry, namely the rise of Fintech companies, has created an opportunity to revisit the economics of the payment system and the puzzling nature of…
Is the Recent Buyback Spree Creating Liquidity Problems for the Dealers?
The anxiaties about large financial corporations' debt-funded payouts—aka "stock buybacks"—is reemerging a decade after the financial crisis. Companies on the S&P 500 have poured more than $5.3 trillion into repurchasing…
Is the Fed Losing Steam in Controlling Interest Rate?
As the final countdown to bring in 2020 begins, new concerns have emerged regarding the Fed's continuous ability to control the interest rate. Developments in the financial market such as…
What Rules Inflation Targeting? A Time for Abandoning Taylor Rule
“No matter how much suffering you went through, you never wanted to let go of those memories.” ? Haruki Murakami Following the Global Financial Crisis (GFC), most central banks around…
Central Counterparties: When Monetary Policy is Not Enough
The overall picture of the U.S. economy, though far from stable, is hardly threatening. For instance, U.S. payrolls grew by 128,000 in October. Nevertheless, the Fed cut the interest rate…