{'fraction_non_alphanumeric': 0.018363939899833055, 'fraction_numerical': 0.0, 'mean_word_length': 5.180412371134021, 'pattern_counts': {'":': 0, '<': 0, '<?xml version=': 0, '>': 0, 'https://': 0, 'lorem ipsum': 0, 'www.': 0, 'xml': 0}, 'pii_count': 0, 'substrings_counts': 0, 'word_list_counts': {'cursed_substrings.json': 0, 'profanity_word_list.json': 0, 'sexual_word_list.json': 0, 'zh_pornsignals.json': 0}}
Interest-Rates-Free Monetary Policy Rule

Interest rates are unreliable indicators of appropriate monetary policy; low nominal rates do not indicate easy money. This paper attempts to assess the stance of monetary policy without relying on interest rates. A new monetary policy rule is developed based on a forward-looking generalization of the Taylor rule. Two complementary approaches are investigated. First, this new monetary indicator is used to evaluate the stance of monetary policy in real time, based on expectations from the Survey of Professional Forecasters in the euro area and in the United States. Second, an ex post analysis based on the latest available data gauges the monetary policy stance in retrospect. The real-time analysis evaluates how the monetary policy stance was judged, and the ex post analysis offers a more objective evaluation of the monetary policy stance. This study highlights that conventional wisdom on monetary policy is often incorrect, even when rates are high. Furthermore, tight monetary policy explains the historical collapse in nominal gross domestic product during the Great Recession, the slow recovery, and the resulting low nominal interest rates.