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Assignment - Writing Monetary Policy Discussion
These are extraordinary economic times, in that the U.S. economy has experienced two major economic recessions within a span of less than 20 years. As the saying goes, extraordinary times call for extraordinary measures. Read the "A New Frontier: Monetary Policy With Ample Reserves" article from The Federal Reserve, located in the topic Resources, which details how monetary policy has been adjusted in the current economy. Based on your understanding of the article, discuss how the Federal Reserve moved the federal funds rate before 2008. Why does that same mechanism not work in the current environment of ample reserves?
1. WATCH THE VIDEO: Know What You're Talking About
2. READ THE ARTICLE: A New Frontier: Monetary Policy With Ample Reserves. Find it in Topic 7 Resources.
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