2013 marks the 100th anniversary of US federal income tax and the establishment of the Federal Reserve. What lessons have we learnt about macroeconomic policy since then? This column assesses the postwar lessons and argues that fiscal expansion is much more likely to be effective in the short term than any monetary expansion stimulus. Indeed, compared with fiscal policy, monetary policy seems more alchemy than science.

The time is right for the world’s central banks to rethink how they conduct monetary policy. This column argues that central banks should follow the lead of Mark Carney, the Bank of England’s new Governor, in considering a move to nominal GDP targeting. If nominal GDP targeting is introduced in two distinct phases, its introduction can deliver the advantage of some stimulus now – when it is needed – while satisfying central bankers’ reluctance to abandon their cherished low inflation target.

The Swiss National Bank (SNB) is again the focus of much debate, accused as it is of currency manipulation. This column outlines the effects of the SNB’s minimum exchange rate. On balance, the authors argue that the move is a boon, effectively enacting a much-needed relaxation of monetary policy within the Eurozone.

Do incidental large-scale bond purchases have a global portfolio balance effect? This column argues that one country’s bond purchases can ease monetary conditions abroad. Whether this effect is welcome depends on the phase of the business cycle, but the authors emphasise that it is of paramount importance for resolving the current crisis that Eurozone policymakers closely consider the effects of large-scale bond buying.

Vietnam’s recent economic performance has been marred by large swings in economic and financial conditions. This column argues that the inability to respond quickly to changing conditions, the pro-growth bias of the State Bank of Vietnam, as well as a 'stop and go' policy style partly explain this. It adds that inefficient state-owned enterprises and weaknesses in the banking system need to be addressed expeditiously.

Even before the crisis, there were some who stressed that monetary policy should keep an eye on asset bubbles and the growth of credit. This column argues that the policy of inflation targeting, used widely in the 1990s and 2000s, did indeed lead to excessive credit growth that eventually bred financial instability.

The Eurozone crisis threatens not just European economies but economies all over the world. This column argues that a global problem calls for a global solution – and the solution this time round is monetary policy. The ECB needs to commit to keeping sovereign debt yields within reason while the Federal Reserve needs to work towards lowering long-term yields.

The world of credit creation has shifted over recent years. This column argues this shift is more profound than is commonly understood. It describes the private credit creation process, explains how the ‘money multiplier’ depends upon inter-bank trust, and discusses the implications for monetary policy.

The global economy is still suffering. This column assesses the structural adjustments, monetary and fiscal policy measures, and financial reforms that are needed to break the vicious cycle of weak growth, impaired financial systems, risks to fiscal sustainability and being propped up by monetary policy.

Before the global crisis, central banks could reply ‘inflation targeting’ to virtually any question about their policymaking and the ‘Great Moderation’ seemed to back them up. The crisis has put a stop to this smugness. Central banks are now engaged in emergency evasive manoeuvres and are scrambling for new intellectual anchors. This column argues that emerging market central banks should target price stability while being mindful of disequilibrium exchange rate movements.