Thursday, December 13, 2012

More on State Dependent Fed Policy

Business Insider:  Fed Announces Evans Rule
So named for Fed Governor Charles Evans who had proposed the new policy.
Goldman's Jan Hatzius predicted the change last year.

Washington Post:  Michael Woodford on the new Fed policy
"Michael Woodford, a Columbia University economist and leading monetary theorist, wrote a crucial paper at the Jackson Hole economic symposium in August arguing that central banks need to use their influence over expectations to boost the economy when interest rates are at the zero lower bound. In that sense, he is among the intellectual godfathers of the new Federal Reserve policy announced Wednesday. "

The Atlantic:  The Man Who Occupied the Fed:  How Charles Evans Saved the Recovery
Very good writeup on the Fed's two new policies (1) announcing a state dependent policy (2) move from Operation Twist to QE (whatever).  And also a mention of how state dependent policy may be a step on the road to NGDP targeting. 

No comments: