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Recent discussions among financial analysts indicate a potential shift in U.S. economic policy from a long-standing focus on monetary policy to an emerging emphasis on fiscal policy. Analysts, including Allison Schrager, suggest that this transition may not be detrimental to the economy. Michael Every elaborates on the complexities of this shift, asserting that the Federal Reserve's role may evolve to accommodate more pragmatic approaches that are both fiscally and monetarily expansionary. This change could signal a significant transformation in how economic strategies are formulated and implemented in the U.S., as the Fed grapples with new challenges under a regime of fiscal dominance, which may render its traditional tools less effective.
'The US is moving from a regime of "monetary dominance" to one of "fiscal dominance." Under such a regime, not only is the Fed's job harder, but its tools are less powerful.' https://t.co/lOBaVZnvlx https://t.co/cGR6I7nC4a
"it’s a question of if, not when, complex reality supplants internally inconsistent, secular-religion ideologies at US think tanks "And the Fed in favour of something more pragmatic,…and fiscally AND monetarily expansionary." --@TheMichaelEvery https://t.co/6wm2WX9y1U… https://t.co/Xn5UDnWeOI
After decades of monetary policy being dominant, the US may be entering an era when fiscal policy reigns — and that's not necessarily a bad thing, says @allisonschrager https://t.co/SHKmx6AkLh via @opinion
