Indexes of asset prices have been suggested as nominal anchors for monetary policy, in place of conventional monetary aggregates. This paper explores issues in modeling and policy simulations of expectations models of auction prices. Long-run (cointegrating) and short-run relationships are...

A standard theoretical assumption of present-value models of asset prices is that agents' expectations of future inflation are embedded in auction prices, such as primary commodity prices and the term structure of interest rates. The aim of this paper is to provide an empirical assessment of the...

We use simulations of the Federal Reserve's FRB/US model to examine the efficacy of a number of proposals for reducing the consequences of the zero bound on nominal interest rates. Among the proposals are: a more aggressive monetary policy; promises to make up any shortfall in monetary ease...

Laubach provides a critical review of the empirical literature that focuses on the effects of budget deficits on interest rates. The main empirical problem in estimating this relationship is to control for other factors determining real interest rates. In particular, the simultaneous response of...