K must have seen me struggling last week, because he’s sent along links to a couple of the Fed’s research papers from last year. As usual with him, interpretation is left as an exercise for the reader. I’m guessing that the Atlanta Fed paper [1] was suggested as a way to see how the Big Banks of NYNY stumbled on a prototype Fed system during the Panic of 1907, three years before that Jekyll Island meeting discussed in my Jan 4th post roughed in the present system. Perhaps a takeaway from the Philly Fed’s effort [2] is that during the 1930s Great Depression America’s currency was too sound and common people hid a lot of it "under the mattress", starving the banks of deposits.
