TITLE

Monetary Policy and Financial Markets: Two Hands Clapping

AUTHOR(S)
DiClemente, Robert V.
PUB. DATE
October 2001
SOURCE
Business Economics;Oct2001, Vol. 36 Issue 4, p67
SOURCE TYPE
Academic Journal
DOC. TYPE
Article
ABSTRACT
Clear and effective communication between central bankers and financial markets helps to establish and reinforce credibility of policy. During the Greenspan era, the Fed has made major strides in effective communication and has largely avoided the damaging consequences of markets misinterpreting Fed policy. By the same token, the Fed's careful attention to signals coming from markets has helped it avoid policy mistakes. It seems reasonable to say that the success of the Fed of the Greenspan era has been as much due to its ability to referee markets as to control them.
ACCESSION #
5568039

 

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