EconPapers Home About EconPapers Working Papers Journal Articles Books and Chapters Software Components Authors JEL codes New Economics Papers Advanced Search.

Theory and Empirical Evidence Peter Sellin Journal of Economic Surveys, vol. This paper gives a comprehensive review of the literature on the interaction between real stock returns, inflation, and money growth, with a special emphasis on the role of monetary policy.

This is an area of research that has interested monetary and financial economists for a long time. Monetary economists have been interested in the question whether money has any effect on real stock prices, while financial economists have investigated whether equity is a good hedge against inflation. Empirical studies show that money can be helpful in predicting future stock returns.

Empirical evidence also suggest that equity is not a good hedge against inflation in the short run but may be so in the long run. The short-run negative relation between stock monetary policy and stock market theory and empirical evidence and inflation can easily be explained by theoretical models.

FRB:Speech, Bernanke--Monetary policy and the stock market--October 2,

If the central bank conducts a countercyclical monetary policy how to earn money from home without investment in bangalore will result in a negative relation between inflation and stock returns, while if it conducts monetary policy and stock market theory and empirical evidence procyclical policy we could observe a positive relation.

According to both theoretical and empirical studies investors receive an inflation risk premium for holding equity.

Monetary policy and stock prices: theory and evidence

Copyright by Blackwell Publishers Ltd Date: View references in EconPapers View complete reference list from CitEc Citations View citations in EconPapers 35 Track citations by RSS feed Downloads: This item may be available elsewhere in EconPapers: Search for items with the same title.

This journal article can be ordered from http: Is your work missing from RePEc?

EconPapers: Monetary Policy and the Stock Market: Theory and Empirical Evidence

Here is how to contribute. Check the EconPapers FAQ or send mail to Obfuscate 'oru.

This site is part of RePEc and all the data displayed here is part of the RePEc data set. EconPapers Home About EconPapers Working Papers Journal Articles Books and Chapters Software Components Authors JEL codes New Economics Papers Advanced Search EconPapers FAQ Archive maintainers FAQ Cookies at EconPapers Format for printing The RePEc blog The RePEc plagiarism page.

Monetary Policy and the Stock Market: