Open Access. Powered by Scholars. Published by Universities.®
Articles 1 - 3 of 3
Full-Text Articles in Entire DC Network
Monetary Policy And The Vix, Rodrigo Galdamez
Monetary Policy And The Vix, Rodrigo Galdamez
Honors Capstones
The relationship between the Federal Reserve monetary policy and the CBOE volatility index, VIX, is examined. Volatility plays a crucial role in pricing derivatives; therefore, an understanding of how macroeconomic factors affect asset prices and volatility is important to market participants. Daily trading data is examined from January 2nd, 1990 to February 29th, 2008. A significant relationship is identified between measures of monetary policy and the VIX, which suggests that the volatility implicit in derivatives is influenced by monetary policy. In particular, volatility is shown to be significantly higher (lower) when the Federal Reserve is following an expansive (restrictive) monetary …
Inflation Targeting : A Cost/Benefit Analysis Of The Monetary Policy Framework, Jason M. Barsema
Inflation Targeting : A Cost/Benefit Analysis Of The Monetary Policy Framework, Jason M. Barsema
Honors Capstones
Inflation has been defined by many great economists such as Milton Friedman as a “monetary phenomenon.” Inflation can cause many adverse effects on the global economy, and history has shown central bankers that through the control of inflation, output will steadily increase over time without the risk of overheating. Inflation targeting is a relatively new, yet controversial subject between central bankers, but over the past twenty years, the framework has proven to be successful in countries like the United States, United Kingdom, New Zealand, and Canada. This paper seeks to identify the roots of inflation through an analysis of history, …
Paul Volcker's Monetary Policy In Retrospect, Michelle C. Pisut
Paul Volcker's Monetary Policy In Retrospect, Michelle C. Pisut
Honors Capstones
Monetary policy is a key factor in determining the course of economic history. Paul Volcker, who held the office of Chairman of the Federal Reserve Board from 1979-1987, left his mark by adamantly fighting inflation throughout his term. He amply filled his role as an inflation fighter by using tight monetary policy to tame the rampant inflation of the late 1970s. Then he led the country into prosperity by implementing an expansionary policy from mid-1982 until the end of his term, still without re-inflating the economy. He stepped down from his office on 1987, leaving Alan Greenspan to lead perhaps …