Why financial policymakers are still fighting the last war

Central bankers and finance ministers are still faced with a triple threat of secular stagnation, liquidity trap and a growth model centred on leverage.

 

Stubbornly low interest rates have failed to generate significant aggregate demand. That suggests the world has been stuck in a prolonged liquidity trap — where companies and consumers hold cash rather than spend.

Any economist will tell you one remedy could address all three battles: fiscal policy. 

Megan Greene FT 23 november 2020

The writer is a senior fellow at Harvard Kennedy School

https://www.ft.com/content/55161e29-27cd-4f9f-ae03-ab6ade9bc04d

Jag tycker det är skriande uppenbart att räntan världen över är för låg och att en större del av stimulanserna borde ske via finanspolitiken.

Rolf Englund blog 5 december 2009

https://englundmacro.blogspot.com/2014/08/skriande-uppenbart.html