This paper documents changes in the cyclical behavior of nominal data series that appear after 1979:IIIQ, when the Federal Reserve implemented a policy to end the acceleration of inflation.
A comparison showing that the transition costs of indexing inflation (a major obstacle to monetary policy reform) are approximately equal to the minor shoe-leather benefits of having price stability.
An argument supporting zero inflation as the sole objective of monetary policy, with particular emphasis on the Bank of Canada’s commitment to an explicit, low inflation target.
This paper provides new evidence on the issue of Federal Reserve System credibility by examining the response pattern of asset prices to the weekly M1 announcements.
The Federal Reserve announces targets for the monetary aggregates that are implicitly conditioned on an assumption about future velocity for each of the monetary aggregates.
Critics of staggered-reserve accounting have used simple models to show that a disturbance to deposits with no change in total reserves sets in motion an undamped cycle.
The idea of monetary policy aimed at producing a stable price level has gained increasing support in the United States in recent years. In 1991, the Neal Resolution proposed to make such a policy objective law.
As 1989 comes to an end, the levels of nominal GNP and the M2 aggregate seem to be in balance, as M2 growth has slowed to a 4 to 5 percent range in the past three years.
The authors argue that a monetary policy of zero inflation would benefit society by eliminating price distortion, increasing economic growth, adding liquidity to the economy, and reducing uncertainty associated with price-level drift.
A review of the Federal Reserve’s Monetary Policy Reports to Congress over the last few years reveals a decline in the role of the monetary aggregates in the policy process.
Every February, the Chairman of the Federal Reserve Board of Governors reports to Congress on the economy and presents objectives for monetary policy for the coming year.
The current budget process is likely to produce large budget deficits in fiscal year 1982 and thereafter. The budget deficit is the residual from the taxing and spending policies of the federal government.
On October 6, 1979, the Federal Reserve System changed its operating procedures for monetary policy. The period following that change has been one of turbulence in the money and capital markets.
A comparison of the performance of forecasts by economists (the Livingston survey), households (the Michigan Survey of Consumer Finances), and a time series model (ARIMA).