The feed federal Reserve and the Economic Bubble On Tuesday, November 16, 1999, the national Reserve Board will decide whether or not to tighten monetary policy at the catereral Open Market Committee meeting. Throughout the year the Fed has been somewhat hesitant to raise rates, which could slow the economy. While upbringing the Federal Funds and Discount Rates could, in the capacious run, lead to higher interest rates, many people get at that the capability for an overheated economy is high, and there is little assay from too slow growth. Overheating in the economy, popularly subsist as the economic bubble, could reverse the current decline in fanfare.
Therefore, action should be taken to prevent such a thing from happening. The purpose of monetary policy is to stabilize prices and develop sure that economy is operating at full potential (stabilize employment and production). Data proves that both have been fulfilled. Price swelling is low at 2% and unemployment is close to 4%. (Bureau of ...If you serving to get a full essay, order it on our website:
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