Federal Reserve Unmasked: The Silent Plunderer

Federal Reserve Bank: Navigating the Nation’s Financial Currents

Nov 13, 2023

Introduction

In the vast and ever-changing landscape of the global economy, the Federal Reserve Bank stands as a beacon of stability and foresight. As the central banking system of the United States, the Federal Reserve Bank plays a pivotal role in guiding the nation’s financial currents. With its mandate to promote maximum employment, stable prices, and moderate long-term interest rates, the Fed’s decisions have far-reaching implications for businesses, consumers, and investors.

Contrarian Approach: Challenging the Status Quo

In finance and economics, the prevailing sentiment often drives market behaviour. Mass psychology and herd mentality can create an environment where investors and observers react to the actions of the Federal Reserve Bank in a predictable and often exaggerated manner. However, a contrarian approach encourages us to challenge the status quo, question popular narratives, and delve deeper into the data to identify potential opportunities others may overlook.

When the Federal Reserve Bank announces a policy decision or takes a specific action, the initial reaction of the market and the media can be intense. It is expected to see fear or exuberance grip investors and observers, leading to dramatic shifts in market sentiment. However, a contrarian investor or observer recognizes that the prevailing sentiment may not always align with reality or the long-term implications of the Fed’s actions.

Adopting a contrarian mindset can challenge the popular narratives that emerge in response to the Federal Reserve Bank’s decisions. Instead of accepting these narratives at face value, we dig deeper into the data, seeking a more comprehensive understanding of the underlying factors that drive the Fed’s actions. This involves analyzing economic indicators, historical precedents, and the broader context in which the decisions are made.

A contrarian approach also enables us to identify potential opportunities where the prevailing sentiment may be misguided. If the market is gripped by fear, driving prices down, a contrarian investor may see it as an opportunity to enter the market at a favourable price. Conversely, a contrarian observer may exercise caution and look for signs of potential overvaluation or excessive risk-taking if the market is exuberant.

Embracing a contrarian mindset allows us to navigate the financial currents with excitement and elegance. It encourages us to think independently, challenge popular narratives, and seek out opportunities that others may overlook. By questioning the prevailing sentiment and analyzing the data, we can better understand the Federal Reserve Bank’s actions and their potential implications.

However, it is important to note that a contrarian approach is not without risks. Going against the prevailing sentiment can be challenging and requires careful analysis and judgment. It is crucial to distinguish between contrarianism and mere contrariness. Contrarianism is a thoughtful and well-informed strategy that seeks to identify opportunities based on a deeper understanding of the underlying dynamics. Mere contrariness, on the other hand, is a stubborn resistance to prevailing sentiment without a solid foundation of analysis and evidence.

The Fed’s Mandate and Monetary Policy

The Federal Reserve Bank plays a central role in the nation’s monetary policy, with the power to influence interest rates by controlling the federal funds rate. While the Fed’s intentions may be to promote price stability and maximum employment, there are arguments that its actions can contribute to fostering boom and bust cycles in the economy.

One key aspect of the Federal Reserve Bank’s monetary policy is its ability to manipulate interest rates. By adjusting the federal funds rate, the rate at which banks lend to each other overnight, the Fed can influence borrowing costs for businesses and consumers. Lowering interest rates stimulates borrowing and investment, which can stimulate economic growth. Conversely, raising interest rates can incentivize saving and reduce borrowing, potentially cooling down an overheated economy.

However, the manipulation of interest rates by the Federal Reserve Bank is not without its critics. Some argue that artificially low-interest rates, especially during periods of economic expansion, can lead to excessive borrowing and risk-taking. This can create asset bubbles in various sectors, such as housing or financial markets. These bubbles can contribute to severe economic downturns, as witnessed during the housing market collapse and subsequent financial crisis in 2008.

The argument is that the Federal Reserve Bank’s actions, mainly when interest rates are kept artificially low for an extended period, can create an environment where market participants take on excessive risk, assuming that easy credit and low borrowing costs will persist. This can lead to misallocations of capital and unsustainable economic growth. These imbalances can unravel when interest rates eventually rise, triggering a bust cycle and economic contraction.

Critics also argue that the Federal Reserve Bank’s interventions in financial markets, such as through quantitative easing programs, can contribute to the distortion of asset prices and market behaviour. By purchasing large quantities of government bonds and other securities, the Fed increases the money supply and injects liquidity into the financial system. This influx of liquidity can drive down yields on bonds and push investors towards riskier assets in search of higher returns.

While the Federal Reserve Bank’s actions aim to stabilize the economy and promote growth, the unintended consequences can be significant. The manipulation of interest rates can distort market signals, leading to mispriced assets and unsustainable economic behaviour. These distortions can contribute to boom and bust cycles, where sharp contractions and economic turmoil follow periods of excessive growth and euphoria.

The Role of Data in Decision-Making

Data plays a crucial role in the decision-making process of the Federal Reserve Bank and other policymakers. It provides valuable insights into the current state of the economy, helps identify trends, and guides the formulation of appropriate monetary policy.

Economic data serves as a foundation for understanding the overall health and performance of the economy. Indicators such as GDP growth, inflation rates, and employment figures provide quantitative measures that reflect the aggregate economic activity and the well-being of individuals and businesses.

By analyzing this data, the Federal Reserve Bank can assess whether the economy is experiencing expansion or contraction, whether inflationary pressures are building up, and whether employment conditions are improving or deteriorating. This information helps policymakers monitor and evaluate the effectiveness of their actions and make informed decisions about the appropriate course of monetary policy.

As a contrarian observer, delving into the nuances of economic data is crucial. It means going beyond the headlines and seeking a deeper understanding of the underlying factors and dynamics driving the numbers. This involves examining the methodologies used to collect and calculate the data, considering potential biases or limitations, and analyzing historical trends and patterns.

It is essential to recognize that economic data is not infallible and can sometimes be subject to revisions or measurement errors. Therefore, a contrarian approach critically evaluates the data and considers alternative interpretations or perspectives. By challenging prevailing narratives and digging deeper into the data, a contrarian observer can gain a more comprehensive understanding of the economic landscape and potentially identify opportunities or risks others may overlook.

Moreover, it is worth noting that economic data is just one piece of the puzzle. It is essential to consider other factors, such as geopolitical events, technological advancements, and social or cultural shifts, which traditional economic indicators may not fully capture. A contrarian observer takes a holistic approach, considering various information and perspectives to form a well-rounded view of the economic environment.

Exploring Alternatives to the Federal Reserve System

Various alternative approaches and potential solutions have been proposed as alternatives to the Federal Reserve Bank’s current monetary policy. Here are a few examples:

1. Free Banking: Some proponents argue for a free banking system, where the government does not have a central bank and the banking industry operates without a monopoly on currency issuance. Under this system, banks would issue their own currencies, and competition among banks would help regulate the money supply. Advocates argue that this would promote market discipline and prevent the concentration of power in a central authority.

2. Gold Standard or Monetary Rules: Another alternative is the adoption of a gold standard or a monetary rule that ties the money supply to a fixed anchor, such as a commodity or a specific rule-based framework. Proponents argue that this would provide a more stable and predictable monetary environment, limiting the discretion of central banks in manipulating interest rates and potentially reducing the likelihood of boom and bust cycles.

3. Market-Based Monetary Policy: Some economists advocate for a more market-based approach to monetary policy. This could involve allowing interest rates to be determined by market forces rather than being set by a central authority. Proponents argue that this would lead to more efficient capital allocation and better price discovery, as interest rates would reflect market conditions and investor preferences.

4. Central Bank Independence and Transparency: Another potential solution is to enhance the independence and transparency of the central bank. This would involve ensuring that the central bank operates free from political interference and is accountable to the public. Proponents argue that increased transparency and accountability would help build public trust and improve the effectiveness of monetary policy.

5. Targeting Alternative Indicators: Instead of focusing solely on inflation or employment targets, some economists propose targeting alternative indicators such as nominal GDP, price level targeting, or a combination of multiple indicators. These approaches aim to provide a more comprehensive framework for monetary policy, taking into account various economic factors and ensuring a balanced approach to achieving stability and growth.

It is important to note that each alternative has its own advantages and disadvantages, and there is ongoing debate among economists about their feasibility and effectiveness. Implementing any significant changes to the current monetary policy framework would require careful consideration and analysis of potential implications and trade-offs.

Ultimately, the choice of alternative monetary policy approaches depends on the specific goals, priorities, and values of policymakers and society. It is a complex and multifaceted issue that requires a thorough understanding of economics, institutional arrangements, and the potential consequences of different policy choices.

Understanding the Economic Cycle

Understanding the economic cycle is crucial for analyzing the actions of the Federal Reserve Bank and their impact on the economy. Economic cycles refer to the fluctuations in economic activity characterized by periods of expansion, contraction, and recovery.

The economy experiences increased output, employment, and overall economic growth during an expansionary phase. This is typically accompanied by rising consumer spending, business investment, and positive market sentiment. During this phase, the Federal Reserve Bank may implement monetary policies to support and sustain the expansion. These policies can include lowering interest rates to encourage borrowing and investment or engaging in quantitative easing to provide liquidity and stimulate lending.

However, as the economy peaks and shows signs of overheating, there is a risk of inflationary pressures and potential imbalances in the economy. The Federal Reserve may shift towards a more contractionary stance to counteract these risks. This can involve raising interest rates to reduce borrowing and cool down economic activity. The aim is to prevent excessive inflation and maintain price stability.

During a contractionary phase, the economy experiences a slowdown in economic activity, often characterized by falling output, rising unemployment, and reduced consumer and business spending. The Federal Reserve may implement expansionary monetary policies to stimulate the economy in response to a contraction. Lowering interest rates and implementing quantitative easing can help boost borrowing and spending, aiming to revive economic growth and restore market confidence.

Understanding the economic cycle is crucial because it provides insights into the possible actions and policies of the Federal Reserve Bank. By closely monitoring economic indicators and trends, such as GDP growth, employment levels, inflation rates, and consumer and business sentiment, analysts can assess the stage of the economic cycle and anticipate potential shifts in monetary policy.

However, it is essential to note that economic cycles can be complex and influenced by various domestic and international factors. External shocks, such as changes in global economic conditions, geopolitical events, or natural disasters, can disrupt the typical patterns of the economic cycle and require adjustments in monetary policy strategies.

As contrarian observers, it is essential to critically analyze the Federal Reserve’s actions within the context of the economic cycle. By understanding the process stage and evaluating the potential risks and challenges, contrarian observers can form a more comprehensive assessment of the central bank’s policies and their implications for the economy.

Navigating Uncharted Waters: Lessons from the Financial Crisis

The global financial crisis 2008 was a significant event that had far-reaching implications for the global economy and financial markets. The crisis tested the ability of central banks, including the Federal Reserve, to respond effectively to unprecedented challenges.

During the financial crisis, the Federal Reserve implemented several unconventional measures to stabilize the financial system and support economic activity. Some of the critical actions taken by the Fed included:

1. Slashing interest rates: The Federal Reserve lowered its target interest rate, the federal funds rate, to near-zero levels. This was done to stimulate borrowing, investment, and economic growth.

2. Quantitative easing (QE): The Fed initiated a series of large-scale asset purchase programs, commonly known as QE. Through QE, the central bank purchased government bonds and mortgage-backed securities to inject liquidity into the financial system and lower long-term interest rates.

3. Emergency liquidity facilities: The Fed established various emergency lending programs to provide liquidity to financial institutions and stabilize the functioning of the financial markets. These programs aimed to prevent the banking system’s collapse and restore market participants’ confidence.

4. Regulatory reforms: In the aftermath of the crisis, the Federal Reserve, along with other regulatory bodies, implemented various reforms aimed at strengthening the financial system. These reforms included stricter capital and liquidity requirements for banks and enhanced financial industry oversight.

As contrarian observers, studying the lessons from the financial crisis and assessing the potential long-term implications of the Fed’s actions is crucial. Here are some key lessons that emerged from the crisis:

1. The importance of financial system resilience: The crisis highlighted the need for a resilient financial system that can withstand shocks and disruptions. The Federal Reserve and other regulatory bodies have since focused on strengthening the stability and resilience of the banking sector through stricter regulations and enhanced oversight.

2. The limitations of traditional monetary policy tools: The crisis demonstrated the limitations of conventional monetary policy tools, such as adjusting interest rates, in times of severe financial stress. This led to the adopting of unconventional measures like QE and emergency lending facilities.

3. The challenge of balancing short-term stabilization with long-term risks: The actions taken by central banks during the crisis were aimed at stabilizing financial markets and supporting economic activity. However, these measures raised concerns about potential long-term risks, such as inflationary pressures, asset price bubbles, and moral hazard. As contrarian observers, assessing and monitoring these potential risks is vital.

4. The interconnectedness of the global financial system: The crisis highlighted the interconnectedness of economic systems across countries and the potential for contagion. Contrarian observers should consider the global implications of central bank actions and monitor developments in international financial markets.

5. The need for continuous evaluation and adjustment of policies: The crisis underscored the importance of ongoing evaluation and adjustment of policies in response to changing economic and financial conditions. As contrarian observers, it is crucial to closely monitor the effectiveness and potential unintended consequences of central bank actions.

By studying the lessons from the financial crisis and critically evaluating the long-term implications of the Federal Reserve’s actions, contrarian observers can gain insights into potential risks, identify emerging trends, and form a more comprehensive understanding of the evolving economic and financial landscape.

The Impact of Quantitative Easing

Quantitative easing (QE) has been a prominent tool used by the Federal Reserve Bank and other central banks to stimulate the economy during times of crisis or when traditional monetary policy measures, such as adjusting interest rates, may be limited.

Through QE, the central bank purchases government bonds and other securities from financial institutions, injecting liquidity into the financial system. The aim is to lower long-term interest rates, promote lending and investment, and stimulate economic activity.

The impact of QE has been a subject of debate among economists. Proponents argue that QE can help support economic growth by reducing borrowing costs for businesses and households, encouraging investment and consumption, and boosting asset prices, such as stocks and real estate. It can also help alleviate financial market stress and improve market functioning during distress.

However, as contrarian observers, it is essential to evaluate QE’s potential risks and unintended consequences critically.

One concern is the potential for inflationary pressures. By increasing the money supply through QE, there is a risk that excessive liquidity in the financial system may lead to inflationary pressures down the line. However, inflationary pressures may be limited during periods of economic downturn or when there is significant slack in the economy.

Another concern is the potential for creating asset price bubbles. The increase in liquidity resulting from QE can lead to a search for yield, with investors seeking higher returns on riskier assets. This can potentially drive up asset prices to unsustainable levels, posing risks to financial stability.

Additionally, QE can have distributional effects. While it aims to stimulate economic activity, the benefits may not be evenly distributed. The impact on different sectors of the economy and other income groups can vary, potentially exacerbating income inequality.

Furthermore, the long-term consequences of QE remain uncertain. The unprecedented scale and duration of QE programs have raised questions about their potential impact on the functioning of financial markets, the misallocation of capital, and the distortions they may create in the economy.

As contrarian observers, it is essential to assess the potential risks and unintended consequences of QE policies, considering alternative perspectives and possible long-term effects. By critically evaluating the impact of QE on inflation, asset prices, distributional effects, and the overall functioning of the economy, we can gain a more comprehensive understanding of its implications.

The Federal Reserve Bank and Inflation

The Federal Reserve Bank plays a significant role in influencing inflation through its control over monetary policy and the money supply. However, it is essential to note that the relationship between the Fed’s actions and inflation is complex, and attributing inflation solely to the Fed oversimplifies the factors contributing to price increases.

The Federal Reserve Bank increases the money supply primarily through open market operations, where it purchases government securities, such as Treasury bonds, from banks and other financial institutions. This injection of money into the economy can potentially lead to increased spending and aggregate demand, which, in turn, can put upward pressure on prices.

However, it is crucial to recognize that inflation is a multifaceted phenomenon influenced by various factors beyond the central bank’s actions. Supply and demand dynamics, changes in production costs, fiscal policy, global economic conditions, and other external factors all contribute to inflationary pressures.

The Federal Reserve Bank also strives to maintain price stability by targeting a specific inflation rate. As mandated by the U.S. Congress, the Fed’s dual mandate includes promoting price stability alongside maximum employment. The Federal Open Market Committee (FOMC), the policymaking body of the Fed, sets an inflation target and adjusts monetary policy accordingly to achieve that target.

The Fed uses various tools to influence inflation, including adjusting the federal funds rate and employing unconventional monetary policy measures like quantitative easing. These actions aim to manage inflation expectations and maintain a stable and predictable inflation environment.

It is worth noting that the Federal Reserve Bank faces challenges in accurately predicting and controlling inflation. Economic forecasting is inherently uncertain, and there can be lags in the effects of monetary policy on the economy. Additionally, external shocks and global economic developments can impact inflation dynamics, making it a complex and challenging task for the Fed to maintain price stability.

As contrarian observers, it is crucial to critically evaluate the Fed’s inflation targets and the effectiveness of its policies. Constructive scepticism and a thorough analysis of the underlying data and economic indicators help form a more comprehensive understanding of inflation trends and drivers. By questioning prevailing narratives and considering alternative perspectives, we can gain a deeper insight into the complexities of inflation and the role of the Federal Reserve Bank in managing it.

Navigating Uncertainty: Forward Guidance

. Forward guidance is a communication tool the Federal Reserve Bank uses to provide information and guidance to financial markets and the public about its future policy intentions. The goal of forward guidance is to influence market expectations, shape behaviour, and provide stability during times of uncertainty.

Through forward guidance, the Fed aims to manage market expectations about future interest rates, asset purchases, or other policy actions. By signalling its future policy path, the central bank seeks to influence borrowing costs, investment decisions, and overall economic activity.

Forward guidance can take various forms, such as providing explicit guidance on the expected path of interest rates, indicating specific economic conditions that would trigger policy adjustments, or expressing a commitment to maintaining accommodative policies for a certain period.

As contrarian observers, it is essential to carefully evaluate the impact of forward guidance on market sentiment and behaviour. While forward guidance can help shape market expectations and provide stability, there are potential challenges and limitations.

Firstly, the effectiveness of forward guidance depends on the credibility and clarity of the central bank’s communication. If the market perceives the central bank’s guidance as credible and reliable, it is more likely to influence market behaviour. However, its impact may be diminished if the guidance is considered uncertain or subject to frequent changes.

Secondly, market participants may not always fully align with the central bank’s guidance. There can be deviations or divergences between market expectations and the intended path set by the central bank. These deviations can occur due to changing economic conditions, unexpected events, or differing interpretations of the central bank’s communication.

Moreover, forward guidance assumes that the future unfolds as anticipated. However, economic and financial conditions can be unpredictable, and unforeseen events can lead to deviations from the expected policy path. As contrarian observers, it is crucial to remain vigilant and consider alternative scenarios or potential deviations from the Fed’s stated guidance.

By critically evaluating the impact of forward guidance and considering potential deviations, contrarian observers can gain insights into market sentiment, assess the effectiveness of the central bank’s communication, and potentially identify opportunities or risks that others may overlook.

Now, let’s dive into an alternative, straightforward approach that fearlessly exposes the Federal Reserve cartel, a puppet master covertly owned by banks.

Federal Reserve Bank: Crooks with Keys to the Jailhouse

Central bankers use monetary policy like a madman would use weapons of mass destruction. The central banks possess the ultimate mass destruction weapon, which they use without remorse. The ultimate weapon is the ability to control the money supply and create boom and bust cycles, and its force is incredibly destructive.

The Federal Reserve Bank utilises this weapon mercilessly to rain misery and death on the unknowing masses. Since Fiat was created, banks have fed off the misery they have wreaked on humanity. How do they feed off this misery? They no longer take from Peter and give to Paul; they make sure that Peter and Paul try to rob each other and everyone else to survive. They control the game, and you are just a pawn in this game. The only day the outcome will change is when the Fed is eliminated. Many Great presidents and leaders shared this opinion; the following quotes prove this.

Great Presidents and Great Men clearly stated that the Federal Reserve Bank is Evil.

“If Congress has the right [it doesn’t] to issue paper money [currency], it was given to them to be used by…[the government] and not to be delegated to individuals or corporations.” President Andrew Jackson Vetoed Bank Bill of 1836

“Give me control of a nation’s money, and I care not who makes its laws.”– Mayer Amschel Bauer Rothschild

“Banks lend by creating credit. They create the means of payment out of nothing.” — Ralph M. Hawtrey, Secretary of the British Treasury

“To expose a 15 Trillion dollar rip-off of the American people by the stockholders of the 1000 largest corporations over the last 100 years will be a tall order of business.” Buckminster Fuller

“Every Congressman, every Senator knows precisely what causes inflation…but can’t support the drastic reforms to stop it because it could cost him his job.” Robert A. Heinlein, Expanded Universe

“It is well that the people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning.” Henry Ford

“The regional Federal Reserve banks are not government agencies. …but are independent, privately-owned and locally controlled corporations.” Lewis vs the United States, 680 F. 2d 1239 9th Circuit 1982

“We have, in this country, one of the most corrupt institutions the world has ever known. I refer to the Federal Reserve Board. This evil institution has impoverished the people of the United States and has practically bankrupted our government. It has done this through the corrupt practices of the moneyed vultures who control it.” Congressman Louis T. McFadden in 1932 (Rep. Pa)

Good Men Continue To Rain On The Evils of The Federal Reserve Bank

“The Federal Reserve banks are one of the most corrupt institutions the world has ever seen. There is no man in my voice who does not know that International bankers run this nation.” Congressman Louis T. McFadden (Rep. Pa)

“These 12 corporations together cover the whole country and monopolise and use every dollar of the public currency for private gain.” Mr Crozier of Cincinnati, before Senate Banking and Currency Committee – 1913

“A great industrial nation is controlled by its system of credit. Our system of credit is concentrated in the hands of a few men. We have come to be one of the worst ruled, one of the most completely controlled and dominated governments in the world– no longer a government of free opinion, no longer a government by conviction and vote of the majority, but a government by the opinion and duress of small groups of dominant men.” President Woodrow Wilson

“We are completely dependent on commercial banks. Someone has to borrow every dollar we have in circulation, cash or credit. If the banks create ample synthetic money, we are prosperous; if not, we starve. We are absolutely without a permanent money system. It is the most important subject intelligent persons can investigate and reflect upon. It is so important that our present civilisation may collapse unless it becomes widely understood and the defects remedied very soon.” Robert H. Hemphill, Atlanta Federal Reserve Bank

Navigating Crooked Markets: A Tactical Approach to Market Manipulation

In a world dominated by manipulation, this trend permeates every facet of our lives, and its momentum shows no signs of slowing. The inevitable endpoint seems to be a moment of mass awakening, likely only occurring when the collective decides to revolt against these manipulative forces. However, history tells us that the masses are slow to react.

As we anticipate this eventual awakening, it’s reasonable to assume that by the time the majority shakes off its unconscious state, the financial markets will have reached unprecedented levels. Corporate debt, in particular, may soar to heights that make today’s seemingly irrational levels appear rational in comparison.

Given this reality, there’s a singular strategy at your disposal: treat every significant pullback or correction as a strategic buying opportunity. Market manipulation, a seemingly perpetual force, is likely to persist indefinitely. Until a definitive shift in this trend occurs, approaching substantial market downturns as buying opportunities remains a practical approach.

Conclusion: Embracing a Contrarian Mindset

As we conclude our exploration of the Federal Reserve Bank and its role in navigating the nation’s financial currents, it is crucial to recognize the power of adopting a contrarian mindset. In a world driven by mass psychology and herd mentality, it is easy to get swept away by prevailing narratives and popular sentiment. However, we can uncover opportunities that others may overlook by challenging the status quo and delving deeper into the data.

To truly understand the motivations and implications of the Federal Reserve Bank’s actions, it is essential to analyze the latest data and study historical precedents. By doing so, we can gain a clearer perspective on the factors shaping the Fed’s decisions and their potential impacts on the economy, businesses, consumers, and investors.

Embracing a contrarian mindset also means questioning popular narratives and challenging conventional wisdom. It requires us to think independently and critically rather than blindly following the crowd. By doing so, we can uncover hidden insights and potential opportunities that may be obscured by prevailing sentiment.

Moreover, a contrarian approach allows us to navigate uncertainty with excitement and elegance. It encourages us to embrace the complexities of the financial landscape and seek out unconventional perspectives. By doing so, we can better understand the Federal Reserve Bank’s actions and their potential ramifications.

Ultimately, our journey to unravel the mysteries of the Federal Reserve Bank and its impact on our ever-evolving financial landscape is an ongoing one. It requires us to remain curious, adaptable, and open-minded. By embracing a contrarian mindset, we position ourselves to make more informed decisions, seize opportunities, and confidently navigate the financial currents.

Originally published on Mar 30, 2016, this article underwent a substantial update in Nov. Over 2400 words were added, bringing fresh perspectives to the evolving landscape of monetary policy.