A description of the little-known rules governing the holding of required clearing balances at the Federal Reserve Banks, a look at the growing popularity of this relatively new phenomenon, and an analysis of its impact on the setting and measuring of monetary policy.

An argument for an institutional reform to lengthen the reserve- accounting period from one week to four weeks and to stagger the reserve-accounting periods among four groups of banks. Such staggered- reserve accounting would allow the Federal Reserve to set operating targets for total reserves.

Reserve requirements have traditionally been viewed as a key instrument of monetary policy. Indeed, textbook discussions of monetary policy typically center on the role of reserve requirements in determining the size of the money multiplier and the magnitude of bank credit expansion. In recent...

The traditional view of banks in the monetary and price level control process is based on banks being producers of money in the form of deposits. Some economists have recently argued, however, that growth of bank deposits has no affect on price level stability. They say that the role of banks in...

Over the past decade, the level of required balances held by depository institutions in the United States has declined dramatically. The decline in reserve balances has fueled a debate over the role of reserve requirements. On the one hand, proponents of reserve requirements argue that low...

An analysis of the effect that monetary control arrangements have on the information content of the money stock announcements in the market for bank reserves.

The discussion in many money and banking textbooks would suggest that the Federal Reserve requires depository institutions to hold a minimum level of non-interest-earning reserves because (1) reserve requirements are a monetary policy tool that allows the Fed to expand the money supply and lower...