Monetary policy in plain English–Can you do better?

Monetary policy. If you’re a financial advisor or investment manager, you know exactly what that means. But what about your clients and other readers of your communications? Do they get it?

Sometimes it’s useful to give a brief explanation of technical terms, as I described in “How to make one quarterly letter fit clients at different levels of sophistication.”

Plain English may not come easily to you. If not, look elsewhere for ideas. The Wall Street Journal is a good source for explanations of such terms.

For example, here’s how columnist David Wessel explained monetary policy in “Central Bankers’ Political Conundrum“:

. . . the interest rates the Fed controls and its ability to print money and buy assets.

I like Wessel’s brief explanation. Sure, he could explain more, but writers must strike a balance between clarity and length.

How would YOU explain”monetary policy”?

There are other ways to explain “monetary policy.” If you have an equally good or even better explanation, please share it below.

If you have plain English challenges

Are there financial terms that you struggle to explain in plain English? If you share them below, I’ll consider them as the topic of a future blog post.