Yield Curve Control Versus Other Increasingly Ineffectual Monetary Policy Tools

In this session, yield curve control (YCC) will be evaluated against five monetary tools that have already been tried with increasingly disappointing results for U.S. economic performance. These other tools include:  policy rate changes; effects of both quantitative easing and tightening operations, also known as QE and QT; cooperation with the depository institutions, which must transmit any successful central bank operation to the broader economy; signaling, which is a favorite for stock market investors, but at the cost reduced growth in the standard of living; and coordination of monetary and fiscal policy, the main feature of the governmental response to the pandemic of 2020-21.

Learning Objectives:

• Learn about the key six transmission mechanisms of central bank policy
• Evaluate alternative monetary policy actions
• Understand how yield curve control may be a better alternative than policies already extensively tried and failed

Session Content Level: Advanced