Discussion of Duesenberry's Paper

There is a large gap between monetary theory and the practice of monetary policy, as I've said a number of times. There is a larger gap between discussions of the theory of economic policy and the actual conduct of policy. When economists discuss economic policy, conclusions are very clear. Policy operations should set the market rate equal to the natural rate, provide something called the "optimum stock of money,11 or in the more esoteric models, move the economy to a so called bliss point.