BROWSE

Hawk

What is a 'Hawk'

A hawk, also known as an inflation hawk, is a policymaker or advisor who is predominantly concerned with interest rates as they relate to fiscal policy. A hawk generally favors relatively high interest rates in order to keep inflation in check. In other words, hawks are less concerned with economic growth than they are with recessionary pressure brought to bear by high inflation rates.

Explaining 'Hawk'

Although the most common use of the term "hawk" is described above, be aware that it can be used in a variety of contexts. In each case, it refers to someone who is intently focused on a particular aspect of a larger pursuit or endeavor. A budget hawk, for example, is one that believes the federal budget is of the utmost importance — just like a generic hawk (or inflation hawk) is focused on interest rates.

Who Is Considered a Hawk?

As of 2016, Esther George, the Kansas City Fed President, is considered a hawk. George favors raising interest rates and fears the potential price-bubbles that accompany inflation. Loretta Mester, the Cleveland Fed President as of 2016, studied under Charles Plosser, former president of the Federal Reserve Bank of Philadelphia and a committed hawk. Mester worries about inflation caused by the low interest rates championed by Doves.

How Are Interest Rates Determined?

At eight annual meetings, a group from the Federal Reserve examines economic indicators such as the consumer price index and the producer price index, and it determines if rates should go up or down. Those who support high rates are hawks, while those who favor low interest rates are labeled doves.

How Do High Interest Rates Affect Inflation?

High interest rates make borrowing less attractive. As a result, consumers become less likely to make large purchases or take out credit. The lack of spending equates with lowered demand which helps to keep prices stable and prevent inflation.

What Are the Benefits of High Interest Rates?

Although the word hawk is often levied as an insult, high interest rates carry a great deal of economic advantages. While they make it less likely for people to borrow funds, they make it more likely for them to save money. Surprisingly, in some cases, banks also end up lending money more freely when interest rates as high. High rates dissipate risk, making banks potentially more likely to approve borrowers with less than perfect credit histories. Similarly, if a country increases interest rates but its trading partners do not, that can result in a fall in the prices of imported goods.


Further Reading


Complete mitochondrial genome of the larch hawk moth,
www.tandfonline.com [PDF]
… Mitogenome Announcement. Complete mitochondrial genome of the larch hawk moth, Sphinx morio (Lepidoptera: Sphingidae) … Mitogenome Announcement. Complete mitochondrial genome of the larch hawk moth, Sphinx morio (Lepidoptera: Sphingidae) …

Observations on the Diet of the Christmas Island Hawk-Owl Observations on the Diet of the Christmas Island Hawk-Owl
www.tandfonline.com [PDF]
… Mitogenome Announcement. Complete mitochondrial genome of the larch hawk moth, Sphinx morio (Lepidoptera: Sphingidae) … Mitogenome Announcement. Complete mitochondrial genome of the larch hawk moth, Sphinx morio (Lepidoptera: Sphingidae) …

A Dove to Hawk Ranking of the Martin to Yellen Federal ReservesA Dove to Hawk Ranking of the Martin to Yellen Federal Reserves
papers.ssrn.com [PDF]
… Mitogenome Announcement. Complete mitochondrial genome of the larch hawk moth, Sphinx morio (Lepidoptera: Sphingidae) … Mitogenome Announcement. Complete mitochondrial genome of the larch hawk moth, Sphinx morio (Lepidoptera: Sphingidae) …

Presentation and validation of the Radboud Faces DatabasePresentation and validation of the Radboud Faces Database
www.tandfonline.com [PDF]
… Mitogenome Announcement. Complete mitochondrial genome of the larch hawk moth, Sphinx morio (Lepidoptera: Sphingidae) … Mitogenome Announcement. Complete mitochondrial genome of the larch hawk moth, Sphinx morio (Lepidoptera: Sphingidae) …

Conditions of Success: a platform for international construction developmentConditions of Success: a platform for international construction development
www.tandfonline.com [PDF]
… Mitogenome Announcement. Complete mitochondrial genome of the larch hawk moth, Sphinx morio (Lepidoptera: Sphingidae) … Mitogenome Announcement. Complete mitochondrial genome of the larch hawk moth, Sphinx morio (Lepidoptera: Sphingidae) …

Influence of Hawk-Eye System on Football Development <span style=[J]' src='/thumbnails/?img=http%3A%2F%2Fen.cnki.com.cn%2FArticle_en%2FCJFDTotal-GZTX201101018.htm' />Influence of Hawk-Eye System on Football Development [J]
en.cnki.com.cn [[J]' href='https:/api.miniature.io/pdf?url=en.cnki.com.cn%2FArticle_en%2FCJFDTotal-GZTX201101018.htm'>PDF]
… Mitogenome Announcement. Complete mitochondrial genome of the larch hawk moth, Sphinx morio (Lepidoptera: Sphingidae) … Mitogenome Announcement. Complete mitochondrial genome of the larch hawk moth, Sphinx morio (Lepidoptera: Sphingidae) …

Hawk: The blockchain model of cryptography and privacy-preserving smart contractsHawk: The blockchain model of cryptography and privacy-preserving smart contracts
ieeexplore.ieee.org [PDF]
… Mitogenome Announcement. Complete mitochondrial genome of the larch hawk moth, Sphinx morio (Lepidoptera: Sphingidae) … Mitogenome Announcement. Complete mitochondrial genome of the larch hawk moth, Sphinx morio (Lepidoptera: Sphingidae) …

Nutritional secondary hyperparathyroidism and osteodystrophia fibrosa in a Hodgson's hawk-eagle (Nutritional secondary hyperparathyroidism and osteodystrophia fibrosa in a Hodgson's hawk-eagle (
www.tandfonline.com [PDF]
… Mitogenome Announcement. Complete mitochondrial genome of the larch hawk moth, Sphinx morio (Lepidoptera: Sphingidae) … Mitogenome Announcement. Complete mitochondrial genome of the larch hawk moth, Sphinx morio (Lepidoptera: Sphingidae) …



Q&A About Hawk


Why would banks be more likely to lend money freely when there are higher interest rates in place?

High interest rates dissipate risk making banks potentially more likely to approve borrowers wit""

Who does Loretta Mester study under?

Loretta Mester studied under Charles Plosser, former president of the Federal Reserve Bank of Philadelphia and a committed hawk.

Who was Charles Plosser?

Charles Plosser was the former president of the Federal Reserve Bank of Philadelphia and a committed hawk.

Are there any disadvantages associated with having too many hawks around at once?

Yes, some economists believe that having too many hawks around at once can cause an economy's GDP (Gross Domestic Product) rate to slow down significantly because people will not want borrow money for spending purposes if it means paying higher interests on their loans which will reduce demand for goods/services which could

What can happen if there are too many hawks in one area?

The economy can become unstable due to too much emphasis on keeping prices stable rather than promoting economic growth through low interest rates and increased borrowing/spending habits.

What do hawks favor when it comes to interest rates?

Hawks favor raising interest rates and fear potential price-bubbles that accompany inflation.

What is a hawk?

A hawk, also known as an inflation hawk, is a policymaker or advisor who is predominantly concerned with interest rates as they relate to fiscal policy. A hawk generally favors relatively high interest rates in order to keep inflation in check. In other words, hawks are less concerned with economic growth than they are with recessionary pressure brought to bear by high inflation rates.

How many times do members from the Federal Reserve meet annually?

Eight annual meetings.

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