Skip to main content

January/February 1994

Posted 1994-01-01

Federal Reserve Lending to Banks That Failed: Implications for the Bank Insurance Fund

by R. Alton Gilbert

During the 1980s, many banks failed, imposing large losses on the Bank Insurance Fund (BIF). The Federal Reserve loaned to many of the banks that ultimately failed, an association that convinced many that Federal Reserve lending practices had increased BIF losses.

Posted 1994-01-01

Measures of Money and the Quantity Theory

by James Bullard

Many economists believe that the quantity theory of money explains the relationship between money and inflation over long periods of time. In particular, they believe that a permanent increase in the quantity of money will eventually produce an equiproportionate permanent increase in the general level of prices.

Posted 1994-01-01

Financial Innovation Deregulation and the "Credit View" of Monetary Policy

by Daniel L. Thornton

As analysts search for explanations for the protracted recovery from the last recession, a great deal of attention has been focused on the "credit view” of monetary policy, which argues that monetary policy affects the economy through the direct effect of policy actions on the supply of depository institutions’ credit.