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Reacting to the Stock Market

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  • Wojciech Grabowski

Abstract

Stock market assets figure prominently, both directly and in a variety of indirect ways in the U.S. personal balance sheet. Current period of turbulence in financial markets raises important questions about the appropriate response of monetary policymakers to extreme movements in asset markets and market reactions to such response. In this essay I review recent developments in the U.S. monetary policy and financial markets and then offer a few remarks on the nature of policy-market interactions.

Suggested Citation

  • Wojciech Grabowski, 2001. "Reacting to the Stock Market," Ekonomia journal, Faculty of Economic Sciences, University of Warsaw, vol. 4.
    • Handle: RePEc:eko:ekoeko:4_210
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    File URL: http://ekonomia.wne.uw.edu.pl/ekonomia/getFile/438
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    References listed on IDEAS

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    1. Roberto Rigobon & Brian Sack, 2003. "Measuring The Reaction of Monetary Policy to the Stock Market," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 118(2), pages 639-669.
    2. John B. Taylor, 1999. "Monetary Policy Rules," NBER Books, National Bureau of Economic Research, Inc, number tayl99-1, March.
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