Are interest rates the most effective economic policy tool?
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By Marshall Auerback This post first appeared on AlterNet Cutting rates at this juncture simply perpetuates current bubble-like conditions and therefore will make the ultimate outcome worse when the bubble inevitably bursts. The one silver lining in the nomination of political hack Steve Moore to the Federal Reserve is that it might spur a productive discussion on the benefits (or lack of them) of monetary policy as an instrument of economic growth. This is principally because it’s just one ingredient for what is necessary to instill economic growth, and not a particularly good one at that. A more direct approach is via appropriately targeted and sufficiently large fiscal actions.
Are interest rates the most effective economic policy tool?
Are interest rates the most effective…
Are interest rates the most effective economic policy tool?
By Marshall Auerback This post first appeared on AlterNet Cutting rates at this juncture simply perpetuates current bubble-like conditions and therefore will make the ultimate outcome worse when the bubble inevitably bursts. The one silver lining in the nomination of political hack Steve Moore to the Federal Reserve is that it might spur a productive discussion on the benefits (or lack of them) of monetary policy as an instrument of economic growth. This is principally because it’s just one ingredient for what is necessary to instill economic growth, and not a particularly good one at that. A more direct approach is via appropriately targeted and sufficiently large fiscal actions.