titanic, ffr, FOMC, monetary control, Open Market Operations, SOMA, fed funds rate

It's high time that I got 'round to the subject of "monetary control," meaning the various procedures and devices  the Fed and other central banks employ in their attempts to regulate the overall availability of liquid assets, and through it the general course of spending, prices, and…

excess reserves, liquidity coverage ratio, required reserves, reserve ratio, reserve-deposit ratio

In my last post in this series, I observed that an economy's "base" money serves as the "raw material" that commercial banks and other private-market financial intermediaries employ in "producing" deposits of various kinds that can themselves serve as means of exchange. If they could do so…

monetary base, money supply, Open Market Operations, repos, reverse repos

In previous installments of this primer I've tried to convince you, first, that monetary policy is ultimately about keeping the available quantity of money from differing substantially, if only temporarily, from the quantity demanded and, second, that doing this boils down in practice to having a money…

deflation, inflation, price level, productivity, velocity of money

Changes in the general level of prices are capable, as we've seen, of eliminating shortages or surpluses of money, by adding to or subtracting from the purchasing power of existing money holdings.  But because such changes place an extra burden on the price system, increasing the likelihood…