e decisions may not be accurate or hard to gather. A couple examples of this are changes in consumer's propensity to spend and save are not predictable, as are changes in consumer and business confidence. Cuts in short-term rates cannot make businesses invest in growth when sales are down, nor can they make consumers go out and spend when they are worried about their portfolios and jobs.Part VIIConclusionAs we have discussed, the Federal Reserve's operating strategy for implementing monetary policy involves interest rate targeting through open market operations. By manipulating reserves balances, the FED is able to maintain control over the fluctuations in the trading of Federal funds. By achieving their short-term and medium-term targets, open market operations is able to affect the long-term goals of monetary policy; price stability, full employment, and economic growth....
