Since the adoption of a flexible exchange rate system in 1973, central banks of most industrialized countries have continued to intervene in foreign exchange markets. One reason is that exchange rate volatility has increased. To reduce volatility, many European countries have agreed to keep...

Recent development in Congress and the courts have focused attention on the relative roles of commercial banks, thrifts, and credit unions. As concern mounted last year about the state of the thrift deposit insurance fund, Congress required commercial banks to share the burden of recapitalizing...

Monetary policy is typically undertaken with an eye to achieving a select few objectives in the long run. The Federal Reserve conducts monetary policy to promote two long-run goals: price stability and sustainable economic growth. In many other countries, central banks have a single long-run...

An abstract for this article is not available.

Inflation targeting has been adopted by many central banks, but not by the U.S. Federal Reserve. Using an estimated New Keynesian business cycle model, I perform counterfactual simulations to consider how history might have unfolded if the Federal Reserve had adopted a form of flexible inflation...

An exploration of the link between changes in the efficiency of the financial system and business cycle fluctuations.

This commentary reviews three of the major innovations suggested in Benston et al. (1986): movement toward greater risk-sensitive approaches, an enhanced role for market discipline and disclosure, and earlier intervention for troubled banks. The author then discusses environmental changes that...

The author discusses three areas she considers important in the evolution of the financial services industry: consolidation and the economies gained from it, governance issues that emerge as the structure of the banking industry changes, and the decline in the market share of banking. This...