monetary means, the degree of control of the central bank is of paramount importance. " ( pp. 3 - 4 ). statistics. in 1939, the federal reserve began a project to bring together the available historical data on banking and money. this effort culminated in 1943 with the publication of banking and monetary statistics, which included annual figures on demand and time deposits from 1892 and on currency from 1860. academic interest in monetary aggregates increased after world war ii. milton friedman ’ s volume studies in the quantity theory of money, which contained phillip cagan ’ s work on money and hyperinflation, appeared in 1956, followed in 1960 by friedman ’ s a program for monetary stability, which advocated that monetary policy engineer a constant growth rate for the money stock. measurement efforts also flourished. in 1960, william j. abbott of the federal reserve bank of st. louis led a project that resulted in a revamping of the fed ’ s money supply statistics, which were subsequently published semimonthly. 5 even in those early years, however, financial innovation posed problems for monetary measurement, as banks introduced new types of accounts that blurred the distinction between transaction deposits and other types of deposits. to accommodate these innovations, alternative definitions of money were created ; by 1971, the federal reserve published data for five definitions of money, denoted m1 through m5. 6 during the early years of monetary measurement, policymakers groped for ways to use the new data. 7 however, during the 1960s and 1970s, as researchers and policymakers struggled to understand the sharp increase in inflation, the view that nominal aggregates ( including credit as well as monetary aggregates ) are closely linked to spending growth and inflation gained ground. in 1966, the federal open market committee ( fomc ) began to add a proviso to its policy directives that bank credit growth should not deviate significantly from projections ; a similar proviso about money growth was added in 1970. in 1974, the fomc began to specify " ranges of tolerance " for the growth of m1 and for the broader m2 monetary aggregate over the period that extended to the next meeting of the committee. 8 in response to house concurrent resolution 133 in 1975, the federal reserve began to report annual target growth ranges, 2 to 3 percentage points wide, for m1, m2, a still broader aggregate m3, and bank credit in semiannual testimony before the congress. in an amendment to the federal reserve act in 1977, the congress formalized the federal reserve

m1. currie argued that collection of monetary data was necessary for the federal reserve to control the money supply, which in turn would facilitate the stabilization of the price level and of the economy more generally. 4 in 1934, marriner eccles asked currie to join the treasury department, and later that year, when eccles was appointed to head the federal reserve, he took currie with him. currie ’ s tenure at the federal reserve helped to spark new interest in monetary board of governors of the federal reserve system ( 1998 ), 1 - 001. in his recent history of the federal reserve, allan meltzer ( 2003, p. 66 ) notes of some of the act ’ s proponents that : " [ o ] ne of their principal aims was to increase the seasonal response, or elasticity, of the note issue by eliminating the provisions of the national banking act that tied the amount of currency to the stock of government bonds. " see mankiw and miron ( 1986 ) for a discussion of the fed ’ s seasonal interest - rate smoothing. the federal reserve did publish data on the issuance of federal reserve notes from its inception. federal reserve notes were only part of total currency in circulation, however, the remainder being made up of national bank notes, united states notes, treasury notes, gold and silver certificates, and gold and silver coin. beginning in 1915, the federal reserve bulletin included data on currency that had been collected by the treasury and data on total bank deposits that had been collected by the office of the comptroller of the currency as a byproduct of its regulatory role, but publication was irregular. indeed, the federal reserve ’ s adherence to the real bills doctrine - which counseled against active monetary management in favor of supplying money only as required to meet " the needs of trade " - gave the new institution little reason to pay attention to changes in the money stock. see humphrey ( 1986 ) for a history of the real bills doctrine. the constraints of the gold standard also restricted ( without entirely precluding ) active monetary management by the federal reserve. in the second edition of his book, currie ( 1935 ) wrote : " the achievement of desirable objectives … rests entirely upon the effectiveness of control. the achievement, for example, of the objective of a price level varying inversely with the productive efficiency of society demands a highly energetic central banking policy and a high degree of effectiveness of monetary control … even for the achievement of the more modest objective of lessening business fluctuations by