Money Growth and Monetary Policy Post-2020
(Revised June 2025) This paper estimates a structural vector autoregression using a monthly dataset that covers both of the last two US recessions: in 2008-09 and 2020. The VAR uses a shadow federal funds rate series to account for the effects that unconventional monetary policy actions had on interest rates while the federal funds rate itself was constrained by the zero lower bound. It also allows for a sharp increase in shock volatility starting in March 2020. Parameter estimates and impulse responses show that information in the Divisia M2 monetary aggregate, revealed through explicit consideration of money supply and money demand, is needed to fully capture the effects that monetary policy shocks have on the economy. Historical decompositions and counterfactual simulations highlight the painful but unavoidable trade-offs faced by the Federal Reserve when confronted with severe supply-side shocks post-2020.

Money in the Search for a Nominal Anchor
(Revised August 2024) From the very start of its fifty-year history, the Shadow Open Market Committee advocated for a monetary policy strategy focused on controlling inflation. With time, the rationale for price stability as the principal focus of monetary policy came to be accepted more widely by academic economists and Federal Reserve officials as well. The SOMC also consistently favored an operational approach involving the use of the monetary base as the policy instrument and a broader monetary aggregate as an intermediate target. These features of SOMC strategy, by contrast, have never gained widespread support among academics or at the Fed. This paper outlines the SOMC's preferred approach, focusing on how the Committee's money-based strategy and arguments for it evolved over time. It then shows that these arguments still apply with force today.

Review of Getting Monetary Policy Back on Track, Edited by Michael D. Bordo, John H. Cochrane, and John B. Taylor
(Revised June 2024) Prepared for The Independent Review.

Targeting Nominal GDP: A Monetarist Cross-Check for Finishing the Job
(Revised May 2025) Prepared for the May 2025 Hoover Monetary Policy Conference.

The Transmission of Monetary Policy Shocks Through the Markets for Reserves and Money
(Revised December 2023) (co-authored with Michael T. Belongia) This paper identifies supply and demand curves for bank reserves and a Divisia aggregate of monetary services within a structural vector autoregressive time-series model. Estimated over four sample periods spanning 1967 through 2020, the model illustrates how monetary policy actions can be interpreted with reference to their initial impact on bank reserves and the federal funds rate and their subsequent effects on Divisia money, nominal consumption spending, the aggregate nominal price level, and the unemployment rate. Model estimates attribute strong inflationary effects to monetary policy in the late 1960s and 1970s and also show that changes in the supply of reserves associated with the Fed's large-scale asset purchases since 2008 worked, as intended, to offset deflationary pressures and reduce unemployment. The model describes a much richer monetary policy process than one focused on interest rates alone.