New Keynesian models of monetary policy assign no role to monetary aggregates, in the sense that the level of output, prices, and interest rates can be determined without knowledge of the quantity of money. We evaluate the empirical validity of this prediction by studying the effects of shocks...

The paper presents a theory of nominal asset prices for competitively owned oil. Focusing on monetary effects, with flexible oil prices the US dollar oil price should follow the aggregate US price level. But with rigid nominal oil prices, the nominal oil price jumps proportionally to nominal...

Interest in commodity prices as indicators of consumerprice inflation has ebbed and flowed withthe rise and fall in commodity prices themselves.True to form, as commodity prices have surged inthe last two years (Chart 1), interest in their predictivepower has returned. Inflation hawks point to...