to be empirically unstable, and there was often only a very loose connection between the growth rate of the monetary base — which the central bank could control — and the growth rate of the broader monetary aggregates, which are more tightly linked to economic activity. moreover, the macroeconomic priority in the 1980s in the united states, the united kingdom, and other major countries was to do “ whatever it takes ” to break the back of inflation and to restore the credibility squandered by central banks that had been unable or unwilling to provide a nominal anchor after the collapse of the bretton woods system. by the early 1990s, the back of inflation had been broken ( thank you, paul volcker ), conditions for price stability had been achieved ( thank you, alan greenspan ), and the time was right for something to fill the vacuum in central bank practice left by the realization that monetary aggregate targeting was not, in practice, a workable monetary policy framework. although it was mostly unspoken, there was a growing sense at the time that a simple, systematic framework for central bank practice was needed to ensure that the hard - won gains from breaking the back of inflation were not given away by short - sighted, discretionary monetary experiments that were poorly executed, such as had been the case in the 1970s. policy rate rules that vacuum, of course, was filled by john taylor in his classic 1993 paper, “ discretion vs. policy rules in practice. ” again, for this audience, i will not need to remind you of the enormous impact this single paper had not only on the field of ultimate objectives for the output gap and inflation figured as criteria for policy decisions. see, for example, taylor ( 1995, 1999 ), clarida ( 1999 ), and clarida, gali, and gertler ( 2000 ). in addition, poole ( 1970 ) and woodford ( 2003 ) are key references on the theoretical criticisms of monetary targeting. - 4monetary economics, but also — and more importantly — on the practice of monetary policy. for our purposes today, i will note that the crucial insight of john ’ s paper was that, whereas a central bank could pick the “ k ” in a “ k - percent ” rule on its own, without any reference to the underlying parameters of the economy ( including r * and u * ), a welldesigned rule for setting a short - term interest rate as a policy instrument should, john argued, respect several requirements

give us a window into what questions banks need regulators to answer about using ai. federal reserve staff is working with the other regulators to provide further clarity in this area. payments : fednow and central bank digital currencies payments is another area where innovation continues to flourish, and the federal reserve is actively engaged in shaping the future payments landscape. the fednowsm service will enable financial institutions of every size, and in every community across america, to provide safe and efficient instant payment services. it is intended to be a flexible, neutral platform that will support a broad variety of instant payments. it will allow depository institutions and their service providers to offer value - added services to their customers, ultimately enhancing competition in the market for payment services. completing and implementing fednow is a high priority, and we expect it to be available by mid - 2023. fednow will help transform the way payments are made through new services that allow consumers and businesses to make payments conveniently, in real time, on any day, and with immediate availability of funds for receivers. our assessment of these benefits has not changed even as we consider whether a central bank digital currency ( cbdc ) might fit into the future u. s. money and payments landscape. my expectation is that fednow addresses the issues that some have raised about the need for a cbdc. as i'm sure you are already aware, earlier this year we published a discussion paper that outlined some design principles, costs, and benefits of a cbdc and solicited public comments. 5 we received over 2, 000 comments, and we are currently reviewing these comments and plan to publish a summary of them. novel charters and access to federal reserve account services before i wrap up, let me touch on one more topic that relates to innovation in bank charter types. in recent years, there has been an increase in novel charter types being authorized or considered across the country at the state and national levels. as a result, federal reserve banks are receiving an increased number of inquiries and requests for access to reserve bank master accounts and financial services, which could provide those institutions with access to the nation's payment system. on august 15, the board of governors published final guidelines that govern how reserve banks will evaluate requests for account access. the guidelines take into account the board's goals to 3 / 4 bis central bankers'speeches ( 1 ) ensure the safety and soundness of the banking system ; ( 2 ) effectively implement monetary policy ; ( 3 ) promote financial