"After the Great Depression John Maynard Keynes led the way in building a new macroeconomic framework to deal with that unprecedented economic reality. Ten years after our own crisis, however, macroeconomics has not come to terms with how to grapple with the idea of financial crises in its...

We investigate the role of economic transparency within the framework of one of Townsend's models of "forecasting the forecasts of others". The equilibrium has the property that "higher order beliefs"; are coordinated into a finite-dimensional setup that is amenable to address monetary policy...