During the last fifteen years the Fed has experimented with a variety of monetary targets, including reserve aggregates (borrowed and nonborrowed); monetary aggregates as measured by M1, M2, and even M3; prices, as measured by P-Star, price indexes, gold prices, and expected inflation; and a...

Recent low and stable inflation rates are, according to most observers, the result of the Federal Reserve's monetary policy, and most observers do not seem to question that the Fed's sole responsibility is to fight inflation. However, as Executive Director Dimitri B. Papadimitriou and Research...

In recent years, the U.S. has seemed to achieve the best of all possible worlds: robust economic growth, very low unemployment, and low inflation. Many would attribute this performance to fewer supply side constraints, as the U.S. has moved away from stifling regulations and other impediments to...

The first part of this paper is an overview of projections of Social Security's future and an explanation of why the projections have led many to believe there is a looming financial crisis. We argue that any problems to be faced are far down the road and not severe enough to justify the use of...

In the debate on monetary policy strategies on both sides of the Atlantic, it is now almost a commonplace to contrast the Fed and the ECB by pointing out the former’s flexibility and capacity to adjust rigidity, and the latter’s extreme caution, and obsession with low inflation. In looking...

The so-called credit crunch of 1966 has long been recognized as the first significant postwar financial crisis, and one that required the first important intervention by the Federal Reserve Bank. In the midst of the robust postwar expansion, the Fed began to fear inflation and tightened monetary...

At a time when small businesses are suffering from a credit crunch, "niche" financial institutions increasingly are filling the void left by more traditional sources of financing, such as commercial banks. In this working paper, authors Dimitri B. Papadimitriou, Ronnie J. Phillips, and L....

Hyman Minsky is best known for his work in the area of financial economics, and especially for his financial instability hypothesis. In recent years, some authors have also recognized his advocacy of the “employer of last resort” as part of his “big government” intervention to help...

All modern economies have a "chartalist" or "state" money, as acknowledged by Friedrich Knapp and J.M. Keynes. In this paper, I examine the "history" of money to shed light on its origins. I also examine in detail the views of those who accepted the chartalist, or state, approach to money, from...

Hyman Minsky's work represents one of the most important links between Post Keynesians and Institutionalists. We begin, in this essay, with a brief summary of some of his earlier work, including his well-known "financial instability hypothesis" and his policy proposals that were designed to...