Abstract
This paper presents unique evidence on financial market expectations during the monetary regime uncertainty of the 1870s. The analysis incorporates quantitative evidence from the option market as well as qualitative evidence from the contemporary financial press. Credibility of monetary policy fluctuated dramatically during this period. Contrary to the impressions given by historians, I find that Grant's 1874 veto of the Inflation Bill did not eliminate fears of inflation. I also conclude that the Resumption Act had significant impact on the expectations of market participants. The evolution of political uncertainty explains market expectations better than standard economic variables do.
Sign-in/Register to access full text options 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
