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The Monetary Policy in the United States Sample Essay

The Monetary Policy in the United States

Congress made Federal Reserve responsible for the adoption of the State’s monetary policy. Nevertheless, it remains responsible for ensuring that the Federal Reserve follows the authority which requires it to maximize employment, maintain stable interest rates without short time fluctuation and maintain stable prices. Fed refers to the U.S.A’s central bank whose aim is to serve the four main roles in the country (Timberlake, 2003). These include the supervision of other banks and financial institutions, implementation of monetary policy, provision of payment to financial institutions and provision of emergency funds which is the last option.

Under monetary policy implementation, the concentration of Fed is on aggregate demand’s management from the public and private economic sectors. In monetary policy, the definition of the implementation that Fed gives is actions that it takes in order to influence money costs and credit availability in order to enhance price stabilization as well as employment maximization. The private sector’s demands and preferences that include small businesses and households influence public sector’s consumption in U.S.A (Timberlake, 2003).

As such, there is a broader monetary policy definition that is maintained by Fed in order to enhance the maintenance of a stable growth of the economy in the country. This definition comprises of the forecasts of the economy and the directives that relate to or made in relation to the nation’s central banker. The aim of the monetary policy is to include the rate of funds that Fed has via Open Market Operations that are commonly called the OMOs. These attract government securities’ buyers to do transaction with the national government using securities that are availed for sale. Fed in 2008 lowered rates to as low as between 0 percent and 0.25 percent while trying to exercise a conventional policy. However this was not successful. Since that time, other attempts have always been made to keep these rates low in order to keep inflation rates low and minimize unemployment rate. Economists have shown with theoretical approaches that unemployment and inflation can never have 0% rates at a particular time. People have advocated for monetary policy in order to attain this phenomenon (Timberlake, 2003).

Harold Lass well Definition of Politics

This was among the political scientists recognized the most and American communications theorists. During the 20th century, he was among those ranked in the first half made of creative social sciences inventors. His actions showed that he was leading. These actions were followed by several methodologies that later became part of intellectual traditions such as statistics measurement, interviewing methods and performing experiments. Politically, he is remembered for his legacy because he made vital contributions. The definition of politics that he gave was adopted as being the best among those of the other scientists in this field.

According to Harold, politics is who gets, what, how and when (Lasswell, 1976). This can better be called the politicalProofreading-Editing formula published whose basis is psychological attributes applicable to the leaders in politics and business. In 1948, the formula was published (Lasswell, 1972). Harold also included propaganda in psychological attributes in order to make a conclusion; the simple politics definition. It is possible to argue that the aspects of how, when and what are the major segments in the implementation of a policy. Nevertheless, the reforms being adopted currently do not mention the process realism in formulating and implementing policies.

Relevance of Harold’s Definition to the Implication and Impact of the Monetary Policy in the United States of America

In this definition, what aspect can be used to bridge the existing gap between the economics theory and policy practice. This can assist in determining the appropriate procedures that would lead to appropriate measures in addressing the inflation and unemployment issues. The measures give attributes that involve economic status’ reality as revealed by the central bank. This aspect would assist in avoiding a situation where people would not go to the measures that involve Fed directly while acting on both public and private sector consumption and this would enhance prices’ stabilization (Lasswell, 1972).

The how aspect of this definition would assist the Fed and the government in establishing different ways of handling economic situations that would come up at varying periods of depression and boom. Their focus will be on what can be done regardless of the faced challenges. When as an aspect of the definition will assist in deciding on different ways of handling economic situations promptly. This is due to the truth that regardless of the way stability is maintained by the central bank, the economy behaves differently at various economic times. As such, several ways have been devised to handle economic situation at certain times (Lasswell, 1976).

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Lasswell, H. D. (1972). Politics: who gets what, when, how. New York: Meridian Books.

Lasswell, H. D. (1976). Psychopathology and politics. Chicago: University of Chicago Press.

Timberlake, R. H. (2003). Monetary policy in the United States: An intellectual and institutional history. Chicago Univ. of Chicago Press.

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