Notes On Macroeconomic Policy And Monetary Policy

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Reorienting macroeconomic policy
Feb 12th 2010, 16:33 by S.D. | WASHINGTON
This article is written from a positive standpoint it also discusses Blanchard and Co.s list of the oversights and mistakes of Great Moderation macroeconomics and macro policy. Which include some items I will discuss such as: fiscal policy, monetary policy, monetary policy focused exclusively on inflation and used only one target the policy rate, and financial regulation was in its own silo, outside the macro policy framework.

The writers discuss that policy was too fixated on safeguarding that inflation stayed stable and low. Even the relationship between output and inflation is understood quite poorly, especially at low rates of inflation. Additionally the authors make a plea for not thinking of the policy rate as the only tool of monetary policy, even in more normal times.

Link to article http://www.economist.com/blogs/freeexchange/2010/02/imf The health and performance of a country 's economy are measured in terms of achievement of the set economic objectives. Economists use a variety of economic indicators. These economic indicators measure the macro-economic variables that enable economists to measure the performance of an economy either directly or indirectly. Policy makers track these indicators to assess whether to intervene and if the intervention worked or not. Some of the indicators are as follows:
• Levels of the real national income of a country
• Output and spending and level of

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