which was blamed in part on undue political influence on monetary policymakers. Following these events, both formal models and informal conventional wisdom held that, to avoid pressures to overheat the economy and allow higher inflation, the Fed needed greater independence from politics. However, the inflation-centric rationale for CBI looks a bit outdated in a world in which inflation and nominal interest rates are too low, rather than too high; and in which politicians have criticized central banks for being too expansionary rather than not expansionary enough Indeed, the same logic that holds that CBI is necessary to avoid excess inflation can be turned on its head, to imply that CBi is a barrier to the fiscal-monetary coordination needed to combat deflation(Eggertsson, 2013) The last principal section of the paper briefly takes up these issues. I argue that the case for CBi has always been broader than the anti-inflationist argument, and that CBI should remain in place in the new economic environment. at the same time i contend that the case for cbi is instrumental, that it depends on costs and benefits rather than on philosophical principles, so that the limits of independence appropriately depend on the sphere of activity under consideration and on economic conditions. The general principle of CBI thus does not preclude coordination of central bank policies with other parts of the government in certain situations DEFEATING THE ZLB UNCONVENTIONAL POLICY TOOLS Central bankers in 2008 faced extraordinarily difficult challenges, in particular the combination of a deep recession-which made a sharp easing of monetary conditions necessary-and the proximity of short-term interest rates to zero, which made easing difficult In response, monetary policymakers employed a number of unconventional policy measures Which ones will become part of the standard toolbox? In what order or combination might the various tools of monetary policy be used in the future? In this section, I comment on these issues. I take as given that management of a short-term policy rate(e. g. the federal funds rate in the United States)will remain the primary tool, so long as the ZlB is not binding. I wont have much to say about the technicalities of monetary policy implementation(e. g, the distinction between a"floor" and"corridor" system for managing short-term rates), although unconventional policies(such as quantitative easing) can at times complicate implementation. I discuss, sequentially, forward guidance, quantitative easing, negative rates, and yield curve control(the management of longer-term yields)4 which was blamed in part on undue political influence on monetary policymakers. Following these events, both formal models and informal conventional wisdom held that, to avoid pressures to overheat the economy and allow higher inflation, the Fed needed greater independence from politics. However, the inflation-centric rationale for CBI looks a bit outdated in a world in which inflation and nominal interest rates are too low, rather than too high; and in which politicians have criticized central banks for being too expansionary rather than not expansionary enough. Indeed, the same logic that holds that CBI is necessary to avoid excess inflation can be turned on its head, to imply that CBI is a barrier to the fiscal-monetary coordination needed to combat deflation (Eggertsson, 2013). The last principal section of the paper briefly takes up these issues. I argue that the case for CBI has always been broader than the anti-inflationist argument, and that CBI should remain in place in the new economic environment. At the same time, I contend that the case for CBI is instrumental, that it depends on costs and benefits rather than on philosophical principles, so that the limits of independence appropriately depend on the sphere of activity under consideration and on economic conditions. The general principle of CBI thus does not preclude coordination of central bank policies with other parts of the government in certain situations. DEFEATING THE ZLB: UNCONVENTIONAL POLICY TOOLS Central bankers in 2008 faced extraordinarily difficult challenges, in particular the combination of a deep recession—which made a sharp easing of monetary conditions necessary—and the proximity of short-term interest rates to zero, which made easing difficult. In response, monetary policymakers employed a number of unconventional policy measures. Which ones will become part of the standard toolbox? In what order or combination might the various tools of monetary policy be used in the future? In this section, I comment on these issues. I take as given that management of a short-term policy rate (e.g., the federal funds rate in the United States) will remain the primary tool, so long as the ZLB is not binding. I won’t have much to say about the technicalities of monetary policy implementation (e.g., the distinction between a “floor” and “corridor” system for managing short-term rates), although unconventional policies (such as quantitative easing) can at times complicate implementation. I discuss, sequentially, forward guidance, quantitative easing, negative rates, and yield curve control (the management of longer-term yields)