Category Archives: Monetary Policy
Central Banks Without Rules Are Like Doctors Without Checklists
Recent proposals for policy rules legislation have led to a fascinating replay of issues that have long been at the heart of the rules versus discretion debate. Larry Summers raised one in a debate between him and me at the … Continue reading
Posted in Monetary Policy, Teaching Economics
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Witness Allan Meltzer and the Ouija Board Analogy
Last week the Senate Banking Committee held a hearing about monetary reform and the need for “responsible oversight” of the Fed as Senator Richard Shelby, the Committee Chair, put it. Allan Meltzer was a witness, and I sat next to … Continue reading
Posted in Monetary Policy, Regulatory Policy
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Which Fed Bill Would Milton Friedman Have Liked?
Writing last week on the Cato at Liberty blog, Steve Hanke argued that Milton Friedman would have supported the “Audit the Fed” bill recently introduced in the Senate. Steve’s reasoning is based on Friedman’s 1962 essay “Should there be an … Continue reading
Posted in Monetary Policy
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Janet Yellen’s Speech on Policy Rules
For many years, going back to the days before Google and Google Scholar helped us find and keep track of things, I created a monetary policy rule home page with links to papers, articles and speeches on policy rules, including … Continue reading
Posted in Monetary Policy
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A Feature Not a Bug in the Policy Rules Bill
In his opening line of questions for Janet Yellen at the Senate Banking Committee today, Senator Richard Shelby asked about the use of monetary policy rules and the Taylor Rule, apparently referring to the recent policy rules bill (Section 2 … Continue reading
Posted in Monetary Policy
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It’s Not About Conspiracy Theorizing, It’s About Effectiveness
Yesterday Paul Krugman took some pot shots at an op-ed that Paul Ryan and I wrote nearly five years ago—an op-ed that was critical of quantitative easing. Here’s why Krugman missed his mark and the QE critics are correct. The … Continue reading
Posted in Monetary Policy
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Paul Krugman Pontificating on Policy Rules
In a recent blog post Paul Krugman talks a lot about policy rules and the Taylor rule in particular. He complains that “Republicans are pushing to mandate that the Fed follow the so-called Taylor rule.” But the policy rule legislation that … Continue reading
Posted in Monetary Policy
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Reply to Alan Blinder Redux
Alan Blinder has written another Wall Street Journal article criticizing legislation that would simply require the Fed to describe its rule or strategy for monetary policy. As with his earlier article, Blinder still “shoots at a straw man of his own … Continue reading
Posted in Monetary Policy
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A New Fed Centennial Volume with a Twist
As the two year centennial of the founding of the Fed in 1913-14 draws to a close this month, a new centennial volume, Frameworks for Central Banking in the Next Century, is being published as a special issue of the … Continue reading
Posted in Monetary Policy
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The Taylor Curve Has Two Dimensions In Both Hemispheres
Springtime in the Southern Hemisphere is wonderful, and I have been having fun here for the past 10 days, keynoting at two great conferences, with one talk on central bank independence at the Central Bank of Chile and another talk on … Continue reading
Posted in Monetary Policy
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Economics One 