Question

What are the Federal Reserve’s policy goals or its targets? Do you believe the Federal Reserve...

What are the Federal Reserve’s policy goals or its targets? Do you believe the Federal Reserve has the tools necessary to accomplish its current set of policy goals? Would you suggest changes to the Fed’s existing set of goals? What should they be? Why? If not, why not?

Are there any regulatory rules or practices you would alter? Why?

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Answer #1

The goals of Federal reserve policy includes the following.

1) Stability in financial system

2) Pricing stability by controlling Inflation

3)Full employment by generating new employment opportunities

4) Economic growth

5) Interest rate stability

I don't think that the federal reserve has necessary tools to achieve its above goals.

It requires changes in their existing set of goals.They should also focus on nominal GDP targeting,price level targeting and Inflation target range . They now just focus on temporary price level targeting .Thus it requires the above changes in their goals

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