Wednesday, February 6, 2013

Anchors Aweigh!

Nominal anchors don't like floaters. The US Treasury is receiving so many A scores that it may soon be at the top of the honorary roll call of "How to create hyperinflation 101":
U.S. to Offer Floating-Rate Notes Within a Year
Hint for the next exam: time to review some ancient lessons on how to "dry the ice."

PS: Fischer & Summers (1989) is a classic on indexation (HT to Larry White).

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