Bill Nelson on the Withering Fed Funds Market
From Simply Put by Will Compernolle
February 20, 2026 · 43 min · Season 1 · Episode 72
About this episode
Bill Nelson discusses the changes in the federal funds market and potential alternatives to current short-term rate policies.
The Federal Reserve influences financial conditions through the federal funds market, a private market consisting of unsecured overnight interbank transactions. As the locus of money markets moves away from fed funds and more towards repos and SOFR, Dallas Fed President Lorie Logan has argued the current policy regime no longer suits the financial system. In this episode, we talk with Bill Nelson, Chief Economist and Chief Research Officer at the Bank Policy Institute, about the shifting nature of the fed funds market, what it would take to revive fed funds, and some alternative approaches to short-term rate policy.
People in this episode
Host: Will Compernolle
Guest: Bill Nelson
Topics covered
- federal funds market
- financial conditions
- short-term rate policy
- repos
- SOFR
- economic policy
Keywords
- federal funds
- financial system
- rate policy
- repos
- SOFR
- Bill Nelson
- Lorie Logan
Mentioned in this episode
Organizations: Bank Policy Institute, Federal Reserve, Dallas Fed
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