The Center for Financial Stability is an independent, nonpartisan, and nonprofit think tank dedicated to financial markets for the benefit of investors, officials, and the public.  More

Highlights

Director William A. Barnett speaks on Power Lunch about current inadequate money supply data; how it is leading to misperceptions of the economy; and how the situation will be rectified.

CFS President Lawrence Goodman comments on drivers of demand for Treasury securities in China Ups Holdings Again of US Bonds in China Daily.

In an op-ed published in the WSJ titled Demand for U.S. Debt Is Not Limitless, Lawrence Goodman illustrates how the conventional wisdom that nearly infinite demand exists for U.S. Treasury debt is flawed and offers decisive steps toward recovery.

In Getting it Wrong: How Faulty Monetary Statistics Undermine the Fed, the Financial System, and the Economy,CFS Director William A. Barnett details why best-practice economic measurement is needed today.

Lawrence Goodman takes a deeper look at the U.S. financial accounts in a Bloomberg Surveillance interview with Tom Keene and Ken Prewitt.

In Forbes.com, CFS Director Bruce Tuckman proposes the creation of Federal Liquidity Options.

Bloomberg columnist Caroline Baum cites the work of Lawrence Goodman in her article Four Numbers Add Up to an American Debt Disaster.

CFS Advisory Board Member Richard L. Sandor tells a story of financial and environmental innovation and how Good Derivatives can be used as a force for positive change.

CFS IN THE NEWS

Recent Events

CFS hosted a discussion on bank capital and central banks with Charles Goodhart, former Bank of England Monetary Policy Committee Member and professor emeritus of the London School of Economics.

Former Treasury Under Secretary John B. Taylor discussed First Principles and monetary rules with CFS members.

EVENTS

The Euro, the Snake and the Drachma

As time progresses and the wall of official support for Europe seems to be hitting a ceiling, other solutions must be found. The euro can and should survive in close to its present form... More

Flash: Tri-Party Repo Infrastructure Reform

The Tri-Party Repo Infrastructure Reform Task Force released its final report, with an accompanying statement by the Fed. Read CFS views with respect to the accomplishments of the task force, current state of the tri-party repo system, and current thinking of the Fed... More

The Sovereign Crisis: When Debt is No Longer Risk Free

Policy matters. Advanced economies now embody traits of emerging markets. Europe must prioritize future growth via a three-pronged strategy to reduce debt, remove the threat of contagion, and limit the use of official resources. The appetite for U.S. Treasury debt is weakening. The role of the U.S. dollar as a reserve currency is changing. Sovereign debt is no longer risk free, even in the U.S... More

Federal Liquidity Options: Containing Runs on Deposit-Like Assets without Bailouts and Moral Hazard

Rescuing nonbanks at the risk or expense of the public is still the fallback policy for containing runs on money market funds and repo, and moral hazard remains a problem. To transform this policy regime, Bruce Tuckman proposes that the Fed auction Federal Liquidity Options (FLOs) as the exclusive means of providing liquidity to nonbanks in a crisis... More

Perils of Precedent: Threat to the Sovereign Bond Market

Sovereign debt crises are no longer reserve for emerging market economies only. A pareto optimal approach to sovereign debt for creditors and debtors is key. Present debt disruptions and negotiations will vitally influence the future cost of capital - even in the U.S. Precedent matters... More

Does Math Support Euro Survival?

A quantitative approach to evaluate the relative competitiveness of nations participating in the euro is essential for gauging whether the unified currency can survive. Based on CFS currency valuation models for eleven of the legacy currencies of nations that joined the euro, our view is... More