It is difficult to overstate the benefits of competition, and thus I stand by my admonition of five years ago that policymakers should remain vigilant in antitrust enforcement. Indeed, even though there have not been fundamental changes in the structure, in my judgment what deserves the emphasis is the persistent and even increasing competitiveness of the U.S. banking and financial markets.
What quantity of additional treasury bills should the central bank buy, to reduce inflation by 3 percentage points? To provide the answer, at a minimum, we need to know: 1. How banks will react to the central bank’s purchase of additional T-bills. How much excess liquidity do they have?