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Strategies & Market Trends : Mish's Global Economic Trend Analysis -- Ignore unavailable to you. Want to Upgrade?

To: maxncompany who wrote (89598)	11/3/2008 4:14:54 AM
From: Elroy Jetson	Respond to of 116555

I haven't re-found the St Louis Fed White Paper, but I did find this similar 52 page White Paper from the Richmond VA Federal Reserve Bank. richmondfed.org August 2000, No. 00-3 Overcoming the Zero Bound on Interest Rate Policy Marvin Goodfriend The paper proposes three options for overcoming the zero bound on interest rate policy: 1.) a carry tax on money, 2.) open market operations in long bonds, and 3.) monetary transfers. A variable carry tax on electronic bank reserves could enable a central bank to target negative nominal interest rates. A carry tax could be imposed on currency to create more leeway to make interest rates negative. Quantitative policy -- monetary transfers and open market purchases of long bonds -- could stimulate the economy by creating liquidity broadly defined. A central bank needs more fiscal support than usual from the Treasury to pursue quantitative policy at the interest rate floor. .