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Full Introduction
There is an intimate connection between monetary policy of a country and financial markets. According to McDonough (1998), "few components of economic policymaking are as important to the nation’s economic well-being as monetary policy" (p.1). This is most vividly demonstrated by impact monetary policies of the Federal Reserve has had on the U.S. economy since its birth. The renown Alan Green Span, who was the chairman of the Federal Reserve System for almost twenty-five-years, is credited with preventing the market from crashing in 1987 and for the revival of the American economy since the late 1980s (Taylor, 1989). While Greenspan is the face that takes the credit, the Federal Reserve System remains one of the most powerful institutions created to regulate the nation’s monetary and financial system. This is why many economists believe that the early monetary policies of the Federal Reserve played a direct role in the Great Depression.
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WELCOME
