Stephanie Kelton is a professor of public policy and economics at Stony Brook University. She was the Democrats' chief economist on the staff of the U.S. Senate Budget Committee and an economic adviser to the 2016 presidential campaign of Senator Bernie Sanders.This is her maiden post.
Bloomberg View — Opinion
Use Fiscal Policy, Not the Fed, to Fight the Next SlumpStephanie Kelton | Contributor
Stephanie Kelton also forgot to mention China's role in holding down inflation and keeping the lid on the pot now Trump is throwing a spanner in these particular works:-
ReplyDeletehttp://neweconomicperspectives.org/2018/01/answers-from-the-mmters.html
“This economic recovery is looking long in the tooth”
ReplyDeleteMetaphor....
“ It’s already the third longest U.S. expansion on record, and many observers are worried”
The MMT elites have been calling recession for over seems like 5 years...
“what will happen when this phase of the cycle is over and the country falls into recession. That’s unavoidable, of course,”
It’s certainly avoidable we have been avoiding it for almost 10 years due to fiscal policy which has been constantly increasing while “the deficit!” has been fluctuating by half a $T annual...
@Matt Or we've been avoiding it through the Fed Reserve keeping the punch bowl in place. So that markets (and asset owners) know that they have nothing to worry about as they "climb that wall of worry".
ReplyDeleteUntil now that is, when the yield curve looks to be at risk of inverting simply because of the 10Y yield beginning to descend again. The Fed Reserve was planning on buying the market more time as they slow walked raising rates, only inverting the yield curve at the time of their choosing (took the punch bowl away).
“Punch bowl” is just another metaphor... ie of no scientific value...
ReplyDeleteWe’ve had nicely increasing lead fiscal flow the whole time and non-damaging bank capital conditions ever since the QE stopped ... only recently with the Jan 1 tax reform policy that caused a 30-40 B markdown of some bank assets has policy been unhelpful since the end of QE adds...
Taking away punch bowl = inverting the yield curve. In particular, the Fed Reserve raising their fund rate so that it's greater than the 10Y yield. https://fred.stlouisfed.org/graph/?g=jhrj
ReplyDeleteUntil then, BTFD. Who needs fiscal policy when BTFD makes it rain for everyone. OK, maybe not everyone.
“Punch bowl” is just another metaphor... ie of no scientific value... Franko
ReplyDeleteThen what about virtual liabilities? What value are they in accounting?
Not "virtual", rather sham liabilities.
ReplyDeleteBy that logic you should just claim all abstractions used in any science are “shams”...
ReplyDelete