Divorcing Money from Monetary Policy

@article{Keister2008DivorcingMF,
  title={Divorcing Money from Monetary Policy},
  author={Todd Keister and Antoine Martin and James McAndrews},
  journal={Macroeconomics: Monetary \& Fiscal Policies eJournal},
  year={2008}
}
Many central banks implement monetary policy in a way that maintains a tight link between the stock of money and the short-term interest rate. In particular, their implementation procedures require that the supply of reserve balances be set precisely in order to implement the target interest rate. Because bank reserves play other key roles in the economy, this link can create tensions with other important objectives, especially in times of acute market stress. This article considers an… 
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