The question of whether central banks should target stock prices so as to prevent bubbles and crashes from occurring has been hotly debated. This paper analyses

We estimate the interdependence between US monetary policy and the S & P 500 using structural VAR methodology. A solution is proposed to the simultaneity proble

Economic growth, low inflation, and financial stability are among the most important goals of policy makers, and central banks such as the Federal Reserve are k

A study of asset price bubbles and the implications for preventing financial instability.

Concludes the role of asset prices in monetary policy is one of the most important, and difficult, questions confronting central banks.