A discussion of M2's demise as a reliable indicator of financial conditions in the economy, and a look at recent evidence suggesting that even though the aggregate has been behaving more normally over the past year or so, it is unlikely to regain its status as a key policy guide any time soon.

An examination of the U.S. dollar's growing popularity abroad and a discussion of how the rising currency demand could affect U.S. economic policy.

An examination of GNP forecasts and their implications for monetary policy, showing that although such forecasts have lessened uncertainty about the economy's future course, the errors are still too large to justify basing monetary policy on the near-term GNP outlook alone.

An examination of the monetary policy goals of the Federal Reserve System, with a discussion of the role of the M1 target.

An argument that a monetary policy aimed at eliminating long-run inflation would benefit society by removing price distortion, increasing economic growth, adding liquidity to the economy, and reducing uncertainty associated with price-level drift.

An analysis of the Federal Reserve's use of the M2 monetary aggregate as both a short-term and long-term policy guide, asserting that the FOMC's tentative target range for M2 growth in 1990 permits ample opportunity for the inflation rate to either accelerate or decline during the next few years.

An examination of the apparent breakdown in the relationship between M1 and economic activity, with a discussion of the historical perspective of the breakdown of velocity in the 1980s, and of the monetarist position on recent experience.

An examination of the feasibility and appropriateness of establishing a direct, price-index target as the primary objective of U.S. monetary policy, with particular emphasis on the Swedish Riksbank's experiment with such an approach during the 1930s.

An argument that the Federal Reserve, by targeting a long-run path for the price level, could achieve its price-stability objective without inhibiting its short-term goals.

A review of monetary targeting in recent years and a discussion of issues raised by Federal Reserve Chairman Paul Volcker's February 1984 report to Congress on the System's objectives for the year.