Question
Question #3
In current business publications or on the Federal Reserve Web site (www.federalreserve.gov) final the press release from the most recent meeting of the FOMC. What is the large federal funds rate? How does the FOMC evaluate the balance of risks between its goals of price stability and sustainable economic growth? Drawing on articles in the Wall Street Journal and other business publications, evaluate the following statement: "What the FOMC says is becoming an important as what it does regarding monetary policy implementation". Find the "Parsing the Fed" feature in the online Wall Street Journal for the most recent FOMC press release. Does this feature support the statement in quarter? On the Federal Reserve Web site (www.federalreserve.gov), find the version of the Beige Book that summarizes economic conditions in your Federal Reserve district. Summarize those conditions and relate them in current FOMC policy. On the Federal Reserve Web site, find the minutes of the most recent FOMC meeting. (Minutes of a given meeting, so they lag behind the press releases of the most recent meeting.) Summarize the factors that led to the decision regarding the federal funds rate at that meeting. Building on Figures 13.5 and 13.6, show how equilibrium in the money market would change: If money demand is less sensitive to the interest rate or If there is a greater responsiveness of money defined to changes in income
Explanation / Answer
I chose beige book of january 2013 for the district of Boston .The gowth has been decent with investement specific investments , increase in service sector have grown the business level over the years .Residential areas are recovering drastically , tourism is booming and their is enough business travel and holiday events consisitently happening in the district . THe capital spending is comparatively slower but the housing sales are significantly improving therefore the economic activity are very much stagnant because retail sector is pacing up like health care , durable goods , pharma ,advertising etc .higher growth in sale indicate improvement in the economic condition over the recent years .