What is 'Taylor's Rule'
Taylor's rule is a guideline for interest rate manipulation. Taylor's rule was introduced by Stanford economist John Taylor in order to set and adjust prudent rates that will stabilize the economy in the shortterm and still maintain longterm growth. This rule is based on three factors:
1) Actual versus targeted inflation levels
2) Actual employment versus full employment levels
3) The appropriate shortterm interest rate consistent with full employment.
BREAKING DOWN 'Taylor's Rule'
Taylor's rule suggests that the Fed increases interest rates in times of high inflation, or when employment is above the full employment levels, and decreases interest rates in the opposite situations. This method of controlling interest rates has been fairly consistent with interest policy decisions, even though the Fed does not explicitly subscribe to the rule.

Mondustrial Policy
A fusion of "monetary policy" and "industrial policy," mondustrial ... 
General Employer
An employer who loans an employee to another business, and who ... 
Rule Of 72
A shortcut to estimate the number of years required to double ... 
MasterServant Rule
A legal guideline stating that employers are responsible for ... 
Capital Employed
1. The total amount of capital used for the acquisition of profits. ... 
Rule Of 70
A way to estimate the number of years it takes for a certain ...

Economics
The Taylor Rule: Calculating Monetary Policy
The Taylor Rule suggests how the central bank should change interest rates to account for inflation and other economic conditions. 
Economics
The Taylor Rule: An Economic Model For Monetary Policy
This interest rate forecasting model has helped central banks around the world adjust their rates to balance out inflation. 
Stock Analysis
Procter & Gamble Picks a New CEO (PG)
The Wall Street Journal is reporting that consumer goods giant Procter & Gamble (NYSE: PG) has selected its next leader, David Taylor. The 56year old Taylor is a longtime veteran of the ... 
Retirement
Inflation: Inflation And Interest Rates
Whenever you hear the latest inflation update on the news, chances are that interest rates are mentioned in the same breath. In the United States, interest rates are decided by the Federal Reserve. ... 
Economics
Is 2016 The Year For An Interest Rate Hike?
The debate ultimately centers on the strength of the economy. 
Economics
10 Countries With Lower Interest Rates Than the US
Learn about the 10 countries with lower interest rates than the United States and how interest rates indicate a country's economic outlook. 
Economics
Forces Behind Interest Rates
Interest is a cost for one party, and income for another. Regardless of the perspective, interest rates are always changing. 
Investing Basics
What is the Rule of 70?
The rule of 70 is an easy way to calculate how many years it will take for an investment to double in size. 
Investing Basics
Interest Rates And Your Bond Investments
By understanding the factors that influence interest rates, you can learn to anticipate their movement and profit from it. 
Term
Understanding Interest Rates Inflation And The Bond Market
Interest rates, bond yields and inflation expectations are all correlated.

What is the relationship between inflation and interest rates?
Inflation and interest rates are linked, and frequently referenced in macroeconomics. Inflation refers to the rate at which ... Read Answer >> 
How do I use the rule of 72 to estimate compounding periods?
Find out how and why you can use the rule of 72 to approximate the amount of time it will take for an investment to double ... Read Answer >> 
What happens if interest rates increase too quickly?
Learn about what happens if interest rates rise too fast and understand what goes into the Fedâ€™s decision to adjust interest ... Read Answer >> 
How do I adjust the rule of 72 for higher accuracy?
Read about the Rule of 72, why it is only an approximation, and how the Rule of 69.3 can be substituted in for more accurate ... Read Answer >> 
Why is the employment figure important to a "dove"
Learn why the employment figure is important to "doves." Central banks have competing objectives of economic growth and price ... Read Answer >> 
What is the 'Rule of 72'?
The 'Rule of 72' is a simplified way to determine how long an investment will take to double, given a fixed annual rate of ... Read Answer >>