The government increased payments to individuals without reducing spending elsewhere in the budget.

The rise in the national debt... is entirely a consequence of the federal government’s increase of expenditures without an offsetting increase in revenues.

Market interest rates respond to discount rate changes. What is the reason for this response. This paper investigates several competing hypotheses of why markets respond to discount rate changes. Evidence that the response is invariant to changes in the Federal Reserve's operating procedure...

The Federal Reserve is not formally inflation targeting. Nevertheless, it is commonly believed to be an implicit inflation targeter. The evolution to inflation targeting occurred because central banks, most importantly the Federal Reserve, demonstrated that monetary policy could control...

Current excess reserves could create a massive increase in the money supply if banks significantly increase their lending or investing.

Policymakers should not think of price stability and economic stability as competing objectives but as complements - the best way to achieve the latter is to be firmly committed to achieving the former.

Traditionally, monetary policy has been conducted under a veil of secrecy. In its landmark Freedom of Information Act case, the Federal Reserve argued that it needed to delay the disclosure of its policy decision, claiming that immediate disclosure would cause the market to overreact or react in...