A major conclusion of his analysis is that the form of the loss function depends on the structure the economy considered in the model and defining the transmission mechanism. Specifically, regarding the loss function of Blinder’s  9  Svensson, Lars (2003) “What’s wrong with Taylor rules? Using judgment in monetary policy through targeting rules” in Journal of Economic Literature 41: 426-77.
98 (February), pp. 1–80, www.federalreserve.gov/pubs/bulletin/2012/pdf/scf12.pdf. 5  The homeownership rate for each year is calculated as the average of the quarters displayed in table 16 of “Housing Vacancies and Homeownership”. See U.S. Census Bureau, “Housing Vacancies”, table 16, in note 3. 6  Data on home-purchase lending are from annual filings pursuant to the Home Mortgage Disclosure Act.