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…

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…

asset bubbles, Great Recession, inflation targeting, monetary policy, NGDP targeting

In the first, 1922 edition of Money, his own now-classic primer on monetary economics, the great Dennis Robertson included a chapter he called "Money in the Great Muddle," about the blow World War I dealt to England's once (relatively) rock-solid monetary system, and to other monetary arrangements…

Inflation Expectations, interest on reserves, interest rate targeting, natural rate of interest, QE

Having considered the Fed's pre-crisis approach to monetary control, with its emphasis on interest-rate targets reached with the help of open-market operations, we must now come to grips with the quite different methods it has been employing since, and how the switch to them came about. The…