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Why does the FED cannot set intermediate targets in terms of both monetary aggregates and interest rates?
Wiki User
∙ 14y ago
Monetary aggregate is a goal of money supply. Interest rate is a goal of a constant rate. To hold a specific money supply the interest rate would fluctuate. To hold a specific interest rate the money supply would fluctuate. So they can not work together.
Check this out and read 11.2 through 11.4
http://www.pitt.edu/~jduffy/econ280/lec1213.pdf
Prof. Duffy from the University of Pittsburgh
Wiki User
∙ 14y ago
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Explain why the FED cannot set intermediate targets in terms of both monetary aggregates and interest rates?
Monetary aggregate is a goal of money supply. Interest rate is a goal of a constant rate. To hold a specific money supply the interest rate would fluctuate. To hold a specific interest rate the money supply would fluctuate. So they can not work together.Check this out and read 11.2 through 11.4http://www.pitt.edu/~jduffy/econ280/lec1213.pdf
Why did Fed communicated changes in its monetary policy by announcing changes in its policy targets?
In recent years the Fed has communicated changes in its monetary policy by announcing changes in its policy targets for the:
How is the change in reserve ratio effect monetary policy?
Changes in reserve ratio have an inverse relationship with the money supply. An decrease in reserve ratio allows banks to keep more excess reserves, and thus make more loans. More loans means an increase in the money supply. An increase has the opposite effect. As a addition to this answer, it can be stated that the so-called epicenter of monetary policy in the US is the reserves market controlled in part by the US Federal Reserve System. It is there that the overnight interest rate that the Fed targets is determined and its open market operations have their impact.
Why is it important to set staff targets?
You set staff targets to see if each individual person is performing, theres no point paying someone if someone else is doing there job for them, you get rid and find somone who is willing to make their targets. Maybe even exceed them!!!
What is the role of open market operation?
The Federal Open Market Committee is the part of the Federal Reserve System that is responsible for making monetary policies. It is made up of five Reserve Bank presidents and the Board of Governors. Most of their work involves adjusting interest rates based on the economy. To add more to this summary, the FOMC establishes policy regarding domestic open market operations. It oversees these operations and is authorized to purchase and sell US Government securities. The FOMC may also lend US government securities. The FOMC is a diversified part of the Federal Reserve Bank of New York, and has a complexity of other responsibilities in order to maintain liquidity in financial markets.
Explain why the FED cannot set intermediate targets in terms of both monetary aggregates and interest rates?
Monetary aggregate is a goal of money supply. Interest rate is a goal of a constant rate. To hold a specific money supply the interest rate would fluctuate. To hold a specific interest rate the money supply would fluctuate. So they can not work together.Check this out and read 11.2 through 11.4http://www.pitt.edu/~jduffy/econ280/lec1213.pdf
What are the targets of interest groups?
The targets of interest groups are the groups of people that can most support the cause. Wealthy people are the targets of medical interest groups for example.
Why did Fed communicated changes in its monetary policy by announcing changes in its policy targets?
In recent years the Fed has communicated changes in its monetary policy by announcing changes in its policy targets for the:
What has the author Michael Thomas Summer written?
Michael Thomas Summer has written: 'The operation of monetary targets'
What is monetary policy's?
Answer 1refers to the actions the federal reserve system takes to influence the level of real GDP and the rate of inflation in the economy.Answer 2Monetary policy refers to the control of the supply of money that usually targets the interest rate. This is done to promote stability and economic growth.
What has the author Francesco Lippi written?
Francesco Lippi has written: 'Central bank independence, targets, and credibility' -- subject- s -: Banks and banking, Central, Central Banks and banking, Monetary policy
How is the change in reserve ratio effect monetary policy?
Changes in reserve ratio have an inverse relationship with the money supply. An decrease in reserve ratio allows banks to keep more excess reserves, and thus make more loans. More loans means an increase in the money supply. An increase has the opposite effect. As a addition to this answer, it can be stated that the so-called epicenter of monetary policy in the US is the reserves market controlled in part by the US Federal Reserve System. It is there that the overnight interest rate that the Fed targets is determined and its open market operations have their impact.
How would you manage your individual targets against your team's sales targets?
How would you manage your individual targets, against your team's sales targets?
What is the duration of Targets?
The duration of Targets is 1.5 hours.
What are binding targets?
Targets that simply must be met.
When was Targets created?
Targets was created on 1968-08-15.
When was Designated Targets created?
Designated Targets was created in 2005.
