Macro Musings with David Beckworth

Bill Nelson, chief research officer and economist at the Bank Policy Institute and former Fed monetary official, joins to unpack the Fed's balance sheet future. He traces QE's ratchet effect on reserves. He discusses liquidity rules, supervisory interactions, concrete ways to shrink the Fed footprint, neutralizing TGA swings, and the Fed's profitability and interest-rate risks.

Neha Narula, MIT computer scientist leading the Digital Currency Initiative; Anders Brownworth, veteran crypto engineer who helped launch USDC; Daniel Aronoff, economist studying stablecoins and treasury markets. They unpack how stablecoins are minted, redeemed, and backed. They probe hidden plumbing, technical and operational risks, interoperability across chains, and implications for treasury markets and policy.

Jesús Fernández-Villaverde, a UPenn professor known for quantitative macro, economic history, demographics and AI, explores rapid global fertility declines. He discusses housing’s role in family formation, shifting gender norms and competitive education pressures. He also covers AI’s economic implications and why the dollar keeps its edge in global finance.

Chris Meissner, a UC Davis economist and economic historian who wrote One From Many, offers a sweep of globalization’s past and present. He traces 19th‑century drivers, interwar collapse, Bretton Woods, and late 20th‑century hyperglobalization. He tackles the China shock, supply‑chain interdependence, the Great Financial Crisis’ drag on trade, and whether the world is moving away from integration.

Raghuram Rajan, former RBI governor and IMF chief economist now leading the Group of Thirty, reflects on central banking and financial stability. He revisits his 2005 warning on hidden tail risks. He explains QE’s ratcheting effect on the Fed’s balance sheet, how bank liabilities shift under QE, and policy tools like term deposits and pricing support to curb liquidity dependence.

Andrew Martinez, former U.S. Treasury economist and assistant professor at American University, blends forecasting, time-series econometrics, and policy analysis. He explores the state of macro forecasting, AI’s promise and pitfalls for turning points, why policymakers value simple interpretable models, the SEP’s role in monetary surprises, and the construction of an NGDP expectations gap.

Dan Awrey, Cornell law professor and author of Beyond Banks, explores the future of money and payments. He discusses the shadow monetary system, stablecoin fragility, and why access to core infrastructure matters. He outlines proposals for master accounts, interoperability, and regulatory fixes. The conversation highlights trade-offs between innovation, stability, and who ultimately backs non-bank money.

Scott Sumner, monetary economist known for advocating nominal GDP targeting, shares his post-Mercatus work and blogging. He discusses why nominal GDP matters, how QE and Fed strategy shaped recoveries, and critiques the Fed's framework and risks to central bank independence. Short, sharp takes on level targeting, pandemic policy, and why some QE moves were more effective than others.

Tyler Muir, a UCLA finance professor and Fisher Black Prize winner, explains why quantitative easing reshaped bond markets. He discusses how QE works in crises, the new "Tyler Rule" for balance-sheet use, QE’s role during COVID, and how purchases and announcements affect markets. Short, clear takes on market structure, intermediaries, and the risks of unwinding large Fed balance sheets.

Richard Berner, former director of the Office of Financial Research, dives into critical themes affecting our financial landscape. He discusses the fragility of global liquidity, highlighting how rising sovereign debt complicates stability. Berner also addresses the growth of private credit, its role in recent banking turmoil, and the implications of fiscal dominance—raising concerns about market functioning. With insights from his extensive career, he advocates for better data on private funds to enhance oversight and reduce risks.