scholarly journals The Case for Open-Market Purchases in a Liquidity Trap

2005 ◽  
Vol 95 (1) ◽  
pp. 110-137 ◽  
Author(s):  
Alan J Auerbach ◽  
Maurice Obstfeld
Keyword(s):  
Interest Rate ◽  
Large Scale ◽  
Open Market ◽  
Macroeconomic Stabilization ◽  
Short Term ◽  
Liquidity Trap ◽  
Welfare Impact ◽  
Dynamic General Equilibrium Model ◽  
Policy Tool ◽  
Economic Experience

Prevalent thinking about liquidity traps suggests that the perfect substitutability of money and bonds at a zero short-term nominal interest rate renders open-market operations ineffective for achieving macroeconomic stabilization goals. We show that even were this the case, there remains a powerful argument for large-scale open market operations as a fiscal policy tool. As we also demonstrate, however, this same reasoning implies that open-market operations will be beneficial for stabilization as well, even when the economy is expected to remain mired in a liquidity trap for some time. Thus, the microeconomic fiscal benefits of open-market operations in a liquidity trap go hand in hand with standard macroeconomic objectives. Motivated by Japan’s recent economic experience, we use a dynamic general-equilibrium model to assess the welfare impact of open-market operations for an economy in Japan’s predicament. We argue Japan can achieve a substantial welfare improvement through large open-market purchases of domestic government debt.

scholarly journals The Emergence of Forward Guidance As a Monetary Policy Tool

2021 ◽  
Vol 2021 (032) ◽  
pp. 1-59
Author(s):  
Edward Nelson ◽  
Keyword(s):  
Monetary Policy ◽  
Interest Rate ◽  
Interest Rates ◽  
Policy Instruments ◽  
Open Market ◽  
Short Term ◽  
Factors Affecting ◽  
Interest Rate Policy ◽  
Forward Guidance ◽  
Policy Tool

Forward guidance—the issuance by a central bank of public statements concerning the likely future settings of its policy instruments—is widely regarded as a new tool of monetary policy. The analysis in this paper shows that Federal Reserve policymakers from the 1950s onward actually accepted the premises of forward guidance: the notion that longer-term interest rates are key yields in aggregate spending decisions; and the proposition that indications of intentions regarding future short-term interest rate policy can affect longer-term rates. Over the same period, they were nevertheless wary about providing forward guidance regarding short-term interest rates, fearing that this could generate untoward market reactions or lock the Federal Open Market Committee into inappropriate rate settings. They concentrated on describing future policy in terms of achievement of economic objectives, with their commentary on interest-rate prospects usually confined to consideration of the longer-term factors affecting rates. Even in these years, however, there were infrequent occasions—notably in 1974 and 1982—when policymakers provided more explicit guidance regarding the path of short-term rates. In the 1990s, a consensus developed in U.S. policy circles that was more receptive toward the notion of guiding longer-term interest rates by providing indications of future FOMC actions. This consensus developed even before concerns about the lower bound on short-term rates became prevalent in U.S. policymaking. The new mindset, which stressed the stabilizing effects on the economy of communication of policy intentions, set the stage for the emergence of forward guidance as a monetary policy tool.

scholarly journals Monetary Conditions Index: A Composite Measure of Monetary Policy in Pakistan

2002 ◽  
Vol 41 (4II) ◽  
pp. 551-566 ◽  
Author(s):  
Abdul Qayyum
Keyword(s):  
Monetary Policy ◽  
Exchange Rate ◽  
Interest Rate ◽  
Interest Rates ◽  
Open Economy ◽  
Bank Lending ◽  
Open Market ◽  
Short Term ◽  
Rate Effects ◽  
The Interest Rate

Accurate measures of the size and direction of changes in monetary policy are very important. A number of variables/indicators have been used as a measure of the stance of monetary policy the world over. These include growth rates of monetary aggregates and credit aggregates, short-term interest rate as used by Sims (1992), index of minutes of Federal Open Market Committee (FOMC), as suggested by Friedman and Schwartz (1963) and reintroduced by Romer and Romer (1989), monetary policy index constructed by employing Vector Autoregression (VAR) estimation technique with prior information from Central Bank such as Bernanke and Blinder (1992) and Bernanke and Mihov (1998), and Monetary Conditions Index (MCI)—which is the focus of this paper—constructed by and used by Bank of Canada [Freedman (1995)], taking into consideration the interest rate and exchange rate channel of monetary policy transmission mechanism in a small open economy. In case of open economy it is assumed that the monetary policy affects the economy and the prime objective of monetary policy, rate of inflation, through two important transmission mechanisms. These transmission channels are; interest rate channel and exchange rate channel. The working of the first channel is that the interest rate influences the level of expenditures, investment and subsequently domestic demand. The change in official interest rate effects the market rates of interest both short term as well as long term interest rates. This change in market rates of interest is transmitted to the bank lending rates and saving rates. The change in saving rate effects the spending behaviour of individuals (consumption) whereas the change in bank lending rate effects the investment behaviour of firms (investment). The change in aggregate consumption and investment has direct link to the gross domestic product (GDP).

The Dynamics of the Short-Term Interest Rate in the UK

2005 ◽  
Author(s):  
Diether W. Beuermann ◽  
Antonios Antoniou ◽  
Alejandro Bernales
Keyword(s):  
Interest Rate ◽  
Short Term ◽  
The Uk

scholarly journals BattleNet: Capturing Advantageous Battlefield in RTS Games (Student Abstract)

2020 ◽  
Vol 34 (10) ◽  
pp. 13849-13850
Author(s):  
Donghyeon Lee ◽  
Man-Je Kim ◽  
Chang Wook Ahn
Keyword(s):  
Artificial Intelligence ◽  
Decision Making ◽  
Real Time ◽  
Large Scale ◽  
Outcome Predictor ◽  
Short Term ◽  
Rts Game

In a real-time strategy (RTS) game, StarCraft II, players need to know the consequences before making a decision in combat. We propose a combat outcome predictor which utilizes terrain information as well as squad information. For training the model, we generated a StarCraft II combat dataset by simulating diverse and large-scale combat situations. The overall accuracy of our model was 89.7%. Our predictor can be integrated into the artificial intelligence agent for RTS games as a short-term decision-making module.

scholarly journals Blastocyst formation, embryo transfer and breed comparison in the first reported large scale cloning of camels

2021 ◽  
Vol 11 (1) ◽  
Author(s):  
P. O. Olsson ◽  
A. H. Tinson ◽  
N. Al Shamsi ◽  
K. S. Kuhad ◽  
R. Singh ◽  
...  
Keyword(s):  
Embryo Transfer ◽  
Nuclear Transfer ◽  
Large Scale ◽  
Donor Cell ◽  
Blastocyst Formation ◽  
Short Term ◽  
Embryo Formation ◽  
Large Expansion ◽  
Breed Differences ◽  
Breed Comparison

AbstractCloning, through somatic cell nuclear transfer (SCNT), has the potential for a large expansion of genetically favorable traits in a population in a relatively short term. In the present study we aimed to produce multiple cloned camels from racing, show and dairy exemplars. We compared several parameters including oocyte source, donor cell and breed differences, transfer methods, embryo formation and pregnancy rates and maintenance following SCNT. We successfully achieved 47 pregnancies, 28 births and 19 cloned offspring who are at present healthy and have developed normally. Here we report cloned camels from surgical embryo transfer and correlate blastocyst formation rates with the ability to achieve pregnancies. We found no difference in the parameters affecting production of clones by camel breed, and show clear differences on oocyte source in cloning outcomes. Taken together we demonstrate that large scale cloning of camels is possible and that further improvements can be achieved.

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