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Transmission Mechanism of Monetary Policy

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Two macreconomic textbooks (Able/Bernanke, Makiw) discuss over several chapters the transmission mechanism of monetary policy operations to the broad economy. They are different in some technical aspects, but both describe a very similar process as to how Fed restraint impacts economic conditions. Either process exactly describes what is unfolding in the reserve aggregates (monetary base, total reserves, excess reserves), short-term interest rates, bank loan volumes and the monetary aggregates right now.

My question is… does either process describe operational reality? If not, why not?

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Posted by MachineGhost
Posted on 04/11/2017 11:51 PM
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I don’t have those textbooks handy. What are the mechanisms they describe?

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Cullen Roche Posted by Cullen Roche
Answered on 04/12/2017 12:33 AM
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    It seems to me they rest upon the bogus money multiplier theory. So no fire here.

    BTW, is your Monetary Realism paper up to Western rhetoric standards? I don’t feel comfortable referring others to it if its not in the proper format expected.

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    Posted by MachineGhost
    Answered on 04/18/2017 12:42 AM
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      Is my MR paper written in western rhetoric standards? What does that mean?

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      Cullen Roche Posted by Cullen Roche
      Answered on 04/18/2017 12:45 AM
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        Means, is it in the format expected for academic white papers and dissertations?

        I can’t seem to find an official list of criteria, but see this chart: https://www.scribd.com/doc/16676138/Comparing-Eastern-and-Western-Rhetorical-Thought

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        Posted by MachineGhost
        Answered on 04/18/2017 1:15 AM
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