Category Archives: Monetary Policy
You Can’t Connect the [Fed’s] Dots Looking Forward
Many commentators view last week’s Fed meeting (including the FOMC statement, the Chair’s press conference, commentary from FOMC members) as another move toward more discretion and away from rules-based policy. Their reasoning is mainly based on the Fed’s change in … Continue reading
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The Policy Rule Debate at the Yellen Hearing
Rules-based monetary policy received special focus during Janet Yellen’s inaugural hearing and the second panel immediately following on which I was a witness. In fact, the Chairman of the Committee, Jeb Hensarling, devoted a good part of his opening questioning … Continue reading
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Monetary Policy During Ben Bernanke’s Time at the Fed
Like many monetary economists, I’ve recently been approached by reporters and commentators to say a few words about monetary policy during Ben Bernanke’s time at the Fed. Back in December the Washington Bureau of the Wall Street Journal asked me … Continue reading
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The Great Global Unwinding
If there is a common factor in the recent global market turbulence it is the inevitable unwinding of unconventional US monetary policy. Evidence for this connection appeared last May and June when the Fed started talking about tapering, and it … Continue reading
Catching Up On Some Hot Debates Over Monetary Policy
There have been a flurry of debates and discussions about monetary policy in December, and people have been emailing and tweeting me asking for the links. So here are: — some links to segments (with some overlap) produced by CNBC … Continue reading
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Clarifying Some Key Taylor Rule Calculations
Justin Lahart has an article in the Wall Street Journal today about the Taylor Rule and the time inconsistency of the Fed’s forward guidance. I agree with the spirit of the piece, but unfortunately the article misquotes the Taylor rule … Continue reading
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Response to an Email about QE and a Letter
Recently I received an email with this question about my views on quantitative easing and a letter I signed with others: “I have a question about the letter you signed back in 2010 asking the Fed not to do QE2. That … Continue reading
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It’s Not Doves v Hawks, It’s Rules v Discretion
For years commentators have endeavored to classify monetary policy makers into doves and hawks. Doves are said to be more concerned with unemployment. Hawks are supposedly more concerned with inflation. And because many commentators associate easy money (however one defines … Continue reading
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Short Course on Policy Rules–Including Yellen’s Variant
In a recent interesting article, “The Yellen Fed? Precise and Predictable,” Catherine Rampell assesses Janet Yellen along the discretion/rules-based dimension rather than the hawk/dove dimension which so many others have focused on. Quoting several people, including me, the article suggests … Continue reading
Posted in Monetary Policy, Teaching Economics
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Reviewing the “Too Low For Too Long” Evidence
In her article “Alan Greenspan: What Went Wrong” in the Wall Street Journal Alexandra Wolfe considers whether monetary policy played a role in exacerbating the housing boom going into the financial crisis by holding interest rates “too low for too long.” I’ve … Continue reading
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Economics One 