TY  - UNPD
A1  - Böhl, Gregor
T1  - Monetary policy and speculative stock markets
T2  - Working paper series / Institute for Monetary and Financial Stability ; 119
N2  - Financial market interactions can lead to large and persistent booms and recessions. Instability is an inherent threat to economies with speculative financial markets. A central bank’s interest rate setting can amplify the expectation feedback in the financial market and this can lead to unstable dynamics and excess volatility. The paper suggests that policy institutions may be well-advised to handle tools like asset price targeting with care since such instruments might add a structural link between asset prices and macroeconomic aggregates. Neither stock prices nor indices are a good indicator to base decisions on.
T3  - Working paper series / Institute for Monetary and Financial Stability - 119 
KW  - monetary policy
KW  - asset pricing
KW  - nonlinearity
KW  - heterogeneous expectations
KW  - credit constraints
Y1  - 2018
UR  - http://publikationen.ub.uni-frankfurt.de/frontdoor/index/index/docId/47593
UR  - https://nbn-resolving.org/urn:nbn:de:hebis:30:3-475930
UR  - https://www.imfs-frankfurt.de/de/forschung/imfs-working-papers/
PB  - Johann Wolfgang Goethe-Univ., Inst. for Monetary and Financial Stability
CY  - Frankfurt am Main
ER  -