Saturday, May 24, 2014

Related fragments

At the Library of Economics and Liberty, David Henderson writes:

Why do I make such a strong distinction between the 1960s and the 1970s? Because in the 1960s, the dominant view about economists in macro was Keynesianism, the dominant ideology was statism, and the leading economist was the late Paul Samuelson. By the late 1960s, that had started to shift and by the mid-1970s, the shift was well under way. By the late 1970s, the dominant macro view was either monetarism or rational expectations ... and the leading economist was Milton Friedman.

From Marcelle Chauvet and Zeynep Senyuz:

Before October 1979, the Federal Reserve (Fed) used to target bank reserves in the financial system. A measure of the tightness of monetary policy was the changes in the federal funds rate. In October 1979, the Federal Reserve Bank adopted new operating procedures shifting their emphasis from targeting the federal funds rate to the quantity of non-borrowed bank reserves in order to achieve the desired rates of growth in the monetary aggregates.

From Understanding Open Market Operations by M.A. Akhtar:

The formulation of monetary policy has undergone significant shifts over the years. In the early 1980s, for example, the Federal Reserve placed special emphasis on objectives for the monetary aggregates as policy guides for indicating the state of the economy and for stabilizing the price level. Since that time, however, ongoing and far-reaching changes in the financial system have reduced the usefulness of the monetary aggregates as policy guides.

From Macroeconomics by N. Gregory Mankiw:

In 1993, Fed Chairman Alan Greenspan announced that the Fed would pay less attention to short-run fluctuations in monetary aggregates.

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