Monetary and macroprudential policies

Fed Chair Janet Yellen says that despite concerns about rising asset prices and low volatility, monetary policy should not be subject to financial stability concerns.  Yellen is speaking at an inaugural central banking lecture at the IMF in Washington.

Otaviano Canuto, Matheus Cavallari, 21 May 2013The global financial crisis has shattered the confidence of many established principles of monetary policy and financial supervision. This column argues that the two should not remain separate, and maps out the major challenges faced by their complementary implementation.Full Article: Integrating monetary policy and macroprudential regulation

That’s the title of a conference that took place at USC this weekend, co-organized by Joshua Aizenman, Menzie Chinn and Robert Dekle, and cosponsored by the USC Center for International Studies, USC

November 3, 2013: Dinner: John C. Williams, Jerome H. Powell November 4, 2013:

Today, we are fortunate to have a guest contribution by Ambrogio Cesa-Bianchi and Alessandro Rebucci. It is based upon Does Easing Monetary Policy Increase Financial Instability?.

OTTAWA — More than anything, the financial crisis of 2008-09 was responsible for ushering in a new era of “creative thinking” by central bankers. That translated into near-zero interest rates, followed by rounds of quantitative easing — pumping massive amounts of money into financial systems — and providing monetary policy guidance well beyond the horizon. Now, some are casting even wider nets to include the direct oversight of financial institutions themselves. This is the case in the United States, European Union and the U.K.

Ben Bernanke on how the bank panic of 2007 is similar to the panic of 1907:

Itai Agur, Maria Demertzis, 13 January 2011What institutions should be responsible for financial stability? Do governments need distinct regulators for distinct objectives or should central banks pursue both price stability and financial stability? This column argues that monetary policy inevitably will involve considerations of financial stability due to its effects on banks' risk taking and says that central banks should embrace this dual role.Full Article: Financial stability is a task for central banks