Tom Paine 1949
Diamond Member
- Mar 15, 2020
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While we nobodies at USMB scream and fight about whether the virus was a hoax or a planned conspiracy, and whether the measures taken by the Trump Administration to deal with it were hopelessly inadequate, or an overreaction, the big boys who actually run the economy have taken dramatic measures.
So far, thanks to these extraordinary measures, despite incredible layoffs, business contraction and dramatic declines in the service economy, net consumer income and spending has held up, and the stock market has recovered. That this situation is unsustainable over the long run is clear to all, and most economists fear that a depression, financial collapse or permanently higher unemployment may result if matters get out of hand. The normal working of the economy has been disrupted. The economy has taken huge strides toward state capitalism. More Fed bailouts, credit priming, national indebtedness and “crony capitalism” seem inevitable.
At the same time Congress is debating a new raft of direct payments to millions of newly unemployed. With elections approaching differences between the two parties on fundamentals seem muted, even as both sides accuse the other of treason and fascism or communism. The Federal Reserve and corporate kingpins are pressing for fiscal spending by government to keep the economy alive, so surely something will be scotch-taped together to get us through the next months. But after that ... ?
Fed policymakers call for fiscal support to save U.S. economy
(Reuters) - The U.S. economy, battered by a resurgence in the spread of COVID-19, needs increased government spending to tide over households and businesses and broader use of masks to better control the virus, U.S. central bankers said on Monday.
The calls for increased government intervention came as U.S. lawmakers and the White House resumed talks on a new government relief package, including a possible extension of unemployment benefits that expired on Friday.
“The ball is in Congress’ court,” Chicago Fed President Charles Evans told reporters on a call. “Fiscal policy is fundamental to a better baseline outlook, to a stronger recovery and getting the unemployment rate down, people back to work safely, and ultimately reopening the schools safely.”
Without more government aid, Evans said, “aggregate demand trouble is brewing.” Translated for non-economists: people could stop spending and the bottom could really fall out of the economy.....
Fed policymakers call for fiscal support to save U.S. economy
So far, thanks to these extraordinary measures, despite incredible layoffs, business contraction and dramatic declines in the service economy, net consumer income and spending has held up, and the stock market has recovered. That this situation is unsustainable over the long run is clear to all, and most economists fear that a depression, financial collapse or permanently higher unemployment may result if matters get out of hand. The normal working of the economy has been disrupted. The economy has taken huge strides toward state capitalism. More Fed bailouts, credit priming, national indebtedness and “crony capitalism” seem inevitable.
At the same time Congress is debating a new raft of direct payments to millions of newly unemployed. With elections approaching differences between the two parties on fundamentals seem muted, even as both sides accuse the other of treason and fascism or communism. The Federal Reserve and corporate kingpins are pressing for fiscal spending by government to keep the economy alive, so surely something will be scotch-taped together to get us through the next months. But after that ... ?
Fed policymakers call for fiscal support to save U.S. economy
(Reuters) - The U.S. economy, battered by a resurgence in the spread of COVID-19, needs increased government spending to tide over households and businesses and broader use of masks to better control the virus, U.S. central bankers said on Monday.
The calls for increased government intervention came as U.S. lawmakers and the White House resumed talks on a new government relief package, including a possible extension of unemployment benefits that expired on Friday.
“The ball is in Congress’ court,” Chicago Fed President Charles Evans told reporters on a call. “Fiscal policy is fundamental to a better baseline outlook, to a stronger recovery and getting the unemployment rate down, people back to work safely, and ultimately reopening the schools safely.”
Without more government aid, Evans said, “aggregate demand trouble is brewing.” Translated for non-economists: people could stop spending and the bottom could really fall out of the economy.....
Fed policymakers call for fiscal support to save U.S. economy
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