Joseph Wang on the Fed’s Impact on Money Markets
Macro Musings with David Beckworth
00:00
The Fed and QE
The Fed is becoming increasingly dominant player in the money markets, and not just from the bar inside. Without more access to the Fed, as let's say a place to put liquidity, it's hard to control dollar rates. If you look at BNS data throughout the world, about $10 trillion in US deposit liabilities are booked in our banks outside of the US. And so without greater access To the Fed's balance sheet, I think it's very difficult to have good control over the dollar rates simply because intermediaries rely on QE.
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