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Investigates the relationship between price and financial stability in the U.S. during 1790 to 1997 period. Effects of aggregate price shocks on the index; Contribution of inflation rate shocks to financial stability; Cause of financial instability.

Focuses on the asymmetric relation between prime rates and market interest rates in the United States. Reasons for the asymmetric behavior of prime rates; Use of a dynamic ordered probit model; Data and estimation results on the rate relationship.

Tests the predictive power of the yield-curve slope relative to other United States recession predictors. Explanation on why the yield curve tilt before recessions; Quantifying the yield curve slope as a predictor of recessions; The predictive power of a dynamic model; A richer time series approach in predicting recessions; Conclusions. INSET: Coefficient variation via Markov switching in the probit model..

Explains changes in the federal funds rate as the outcome of an implicit policy of inflation targeting. Description of the interest-rate feedback mechanism; Estimates of implicit inflation targets from 1971 to 1995; Measurement of progress toward price stability.

Tests the hypothesis positing stability of the monetary base. Accounting for structural change; Velocity models; Stability of nominal growth of Gross Domestic Product (GDP) in the McCallum rule; Long term prediction of price through use of nominal GDP target.