The “market” rate will vary from the natural rate for all sorts of reasons other than monetary policy.”[4] As the empirical instability of money demand functions contributed to the demise of Friedman’s monetarism based on monetary aggregates, the concept of the real equilibrium rate in a Wicksellian sense reemerged by the hand of Michael Woodford and Lars Svensson, when both created the theory of inflation targeting monetary regimes.
It appears that the main challenge is to implement legislation governing FinTech companies in order to protect users and markets, while offering an environment favourable to growth. In the context of financial regulation, it is of utmost importance to strike a balance between the following three fundamental elements: 1.