Understanding Asset Prices: Determinants and Policy Implications
نویسندگان
چکیده
منابع مشابه
Monetary policy and asset prices
The purpose of this paper is study the effect of monetary policy on asset prices. We study the properties of a monetary model in which a real asset is valued for its rate of return and for its liquidity. We show that money is essential if and only if real assets are scarce, in the precise sense that their supply is not sufficient to satisfy the demand for liquidity. Our model generates a clear ...
متن کاملMonetary Policy and Asset Prices
The rst part of this paper surveys the literature on asset prices and monetary policy. The original contributions begin in section 3. Here we consider how two types of shocks associated with asset prices a ect the economy, and the appropriate policy response. The rst set of shocks are ones whose primary impact lies in the future. These shocks a ect the economy by raising asset prices today. The...
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This paper studies monetary-policy shocks, de ned from federal funds target movements relative to daily interest-rate data. These shocks are nearly ideal measures of unexpected movements in monetary policy. Market expectations can summarize the vast amount of information used by the Fed in setting policy, and used by Fed-watchers in guessing the Fed’s actions, thus surmounting the omitted-vari...
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Asset prices and the equity premium might reflect doubts and pessimism. Introducing these features in an otherwise standard New-Keynesian model changes in a quite substantial way its normative conclusions. First, following productivity shocks, optimal policy should be very accommodative even to the point to inflate the equity premium. Second, asset-price movements improve the inflation-output t...
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ژورنال
عنوان ژورنال: SSRN Electronic Journal
سال: 2007
ISSN: 1556-5068
DOI: 10.2139/ssrn.1694510