Banking Economics

Is the Fed Santa or Grinch?


Continuing our Christmas theme, there’s a short piece by Amy Farber at on the NY Fed’s web page, which asks if the Fed is more like Santa or the Grinch?

Because the Federal Reserve has something to do with how much money is flowing and how much consumers believe they can spend, the Fed itself is sometimes referred to as “Santa” or “Grinch.” Santa means the Fed is “generous,” or allows more money to trickle into the economy. Grinch means the Fed is “tightening” or “holding back” or “restricting” the amount of money. It’s not always the Fed responsible for a Grinch-vs.-Santa-inspired holiday season; sometimes it’s Congress or individual members of Congress. (See the October 2013 Supermaketguru blog post “Supermarkets Should Get Ahead of A Grinch-y Congress” and the Greenberg Financial Group post from one year ago, “Grinch.” And here’s a recent Guardian piece comparing Congress with Scrooge.)

These says, it’s Santa for sure, which makes you wonder when the bill for all of the gifts is going to come due.

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