Airaudo, Marco; Nisticò, Salvatore; Zanna, Luis-Felipe - LeBow College of Business, Drexel University - 2012
We assess the conditions under which an interest rate rule granting an explicit response to stock prices can shield the … expected future aggregate consumption is affected by the market value of financial wealth, making stock prices non … that, absent additional frictions, a systematic response to stock prices by monetary policy remains a bad idea in the New …