policy financial market participants have no simple formula to guide them in forming expectations about future short - term rates ; instead, they must infer the likely course of policy based on their own economic forecasts and their knowledge of policymakers ’ outlook and objectives. given the complexity of the central bank ’ s forecasting and policy evaluation processes, making these inferences is a daunting challenge. clearly, under a forecastbased policy, central bankers have scope to provide considerable help to the private sector in its attempts to anticipate policy changes. to the extent that policymakers can accurately communicate their outlook, objectives, and tactics to the public, financial markets will be more efficient and monetary policy more effective ( bernanke, 2004 ). i will return to the issue of communication shortly. the policy framework of the federal reserve it would be nice, at this point, if i could tell you definitively whether simple feedback policies or forecast - based policies represent the superior approach to making monetary policy. but drawing strong conclusions at this juncture would be premature, to say the least. the debate in the monetary economics literature remains lively. moreover, to some degree, central bank practice remains eclectic. at the federal reserve, both simple feedback and forecast - based approaches are used to provide information to policymakers. for example, fomc members routinely compare their policy choices with both the prescriptions of various forms of the taylor rule ( as noted, a type of simple feedback policy ) and the results of model simulations and forecasting exercises undertaken by staff at the board and at the twelve reserve banks ( as required by the forecast - based approach ). 8 although i will not try here to resolve the deeper debate about frameworks, i can say something about the degree to which central banks rely on these approaches in practice. both simple feedback policies and forecast - based policies influence how policymakers think about their decisions, as i have just noted. however, in my judgment, reliance on these two approaches is not symmetric ; instead, the forecast - based approach has become increasingly dominant in the monetary policymaking of leading central banks. this dominance is reflected in the resources that central banks devote to data collection and modeling and in the increasing sophistication and detail of central bank forecasts. 9 indeed, a number of central banks with explicit inflation objectives publish regular forecasts and closely link monetary policy decisions to those forecasts. 10 the federal reserve does not explicitly link policy actions to forecasts, but projections of how the economy

with other disclosures and written in small print and dense prose. consumer testing indicates that many consumers set the documents containing these disclosures aside without reading them. under the proposal, creditors must highlight critical changes in a summary table. creditors that enclose their notices with periodic statements must place this table on the periodic statement above the transactions list, where consumer testing suggests consumers are most likely to notice it. checks that access a credit card account many credit card issuers provide accountholders with checks that can be used to obtain cash, pay the outstanding balance on another account, or purchase goods and services directly from merchants. the solicitation letter accompanying the checks may emphasize a low introductory apr for these checks. the proposed revisions would require creditors to disclose other rates and fees that will apply if the checks are used, rather than simply suggest the consumer review the disclosures provided at account opening. to ensure the disclosures are conspicuous, creditors would be required to place the rates and fees in a table on the same page as the checks. right to dispute billing errors the board also has proposed several revisions to substantive and procedural protections tila provides consumers. four proposed revisions, in particular, would clarify regulation z in ways that strengthen consumers'rights to dispute billing errors on credit cards and other forms of revolving credit. first, if a creditor determined that no error occurred, the proposal would make clear that the creditor may not impose finance charges or other charges until the grace period ( if any ) in the credit agreement has elapsed. second, if a creditor credited a borrower's account for a disputed transaction, the proposal would make clear that the creditor may not reverse the credit after two billing cycles or ninety days, whichever period is shorter ; this clarification is meant to ensure finality. third, the proposal would make clear that the right to dispute billing errors covers check transactions that access open - end accounts. fourth, the proposal would make clear that the right to dispute errors applies to purchases of goods or services made using a third - party payment intermediary, such as a person - to - person internet payment service. attachments g - 10 ( c ) applications and solicitations sample ( credit cards ) g - 17 ( b ) account - opening sample g - 18 ( h ) periodic statement form