The Need to Return to a Monetary Framework

John Taylor

Business Economics, 2009, vol. 44, issue 2, 63-72

Abstract: This paper examines the 100-fold increase in reserve balances at the Federal Reserve during 2008. By looking at the balance sheet of the Federal Reserve and factors influencing the supply and demand for reserves, the paper shows that the increase was due to large purchases of securities and loans to certain sectors and institutions. Such actions constitute a combination of monetary policy and industrial policy, or a mondustrial policy. This characterization raises questions about the future of the Federal Reserve and suggests the need to return to a monetary framework that controls the money supply while the interest rate is zero and establishes rules for setting the interest rate.Business Economics (2009) 44, 63–72. doi:10.1057/be.2009.1

Date: 2009
References: Add references at CitEc
Citations: View citations in EconPapers (26)

Downloads: (external link)
http://www.palgrave-journals.com/be/journal/v44/n2/pdf/be20091a.pdf Link to full text PDF (application/pdf)
http://www.palgrave-journals.com/be/journal/v44/n2/full/be20091a.html Link to full text HTML (text/html)
Access to full text is restricted to subscribers.

Related works:
Working Paper: The Need to Return to a Monetary Framework (2009)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:pal:buseco:v:44:y:2009:i:2:p:63-72

Ordering information: This journal article can be ordered from
http://www.springer.com/economics/journal/11369

Access Statistics for this article

Business Economics is currently edited by Charles Steindel

More articles in Business Economics from Palgrave Macmillan, National Association for Business Economics Contact information at EDIRC.
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().