bain_y_howells__monetary_economics__policy_and_its_theoretical_basis

472 MONETARY ECONOMICS
6. This appears to give a target range for inflation of 1-2 per cent, hence
Svensson’s proposal of 1.5 per cent as the point inflation target.
7. See Box 4.1 in Chapter 4 for an explanation of repurchase agreements.
8. Interest rate decisions are announced fortnightly, except in August when there
is normally only on meeting of the Council
9. ‘Structural operations’ are also possible. These are intended to adjust the structural
liquidity of the Eurosystem in relation to the banking system. For an outline
of these, see European Central Bank (2001).
10. This rate was known as the Lombard rate in the Bundesbank’s system.
11. ECB, Monthly Report, December 2001, p. 5.
Chapter 14
1. In each case the bank was granted a 20-year charter, which was not renewed
2. Quoted in Davies (1994).
3. Even by the end of the year 2000, despite large falls in numbers over many
years, there remained 8,315commercial banks in the USA.
4. State governments have the power to charter banks under the US constitution.
The National Banking Act of 1863 empowered a federal agency to issue bank
charters also.
5. No two members were to come from the same Federal Reserve region.
6. Multi-bank panics occurred in 1914, 1930 and 1933, with the panic of 1933
leading to widespread restrictions on the convertibility of deposits into currency.
7. See section 11.3 for the part played by Regulation Q in the development of the
eurocurrency system.
8. Federal Reserve Bank of New York, About the Fed, available on
www.ny.frb.org
9. Quoted in Handa (2000), p. 253.
10. Testimony of Chairman Alan Greenspan. Federal Reserve Board's semiannual
monetary policy report to the CongressBefore the Committee on Financial
Services, U.S. House of Representatives July 18, 2001.
11. Indeed, the Fed is legally required to do this.
12.The MCA required that in 1980 only 3 per cent of the first $25 million of a
bank’s demand deposits and another banking act in 1982 established a zero per