Posted by WARREN MOSLER on February 24th, 2013
And it all still goes unchallenged by the media.
I received this from an associate:
Discussion of “Crunch Time: Fiscal Crises and the Role of Monetary Policy”
“Three important propositions underlie the authors’ argument on this issue:
The federal government’s fiscal path is unsustainable under current policies.
If the market concludes that a government either cannot or will not service its debt, the central bank may be forced to choose ultimately between monetization leading to inflation or standing by as the government defaults–the threat of “fiscal dominance.”
The Federal Reserve’s balance sheet is currently very large by historical standards and still growing. The process of normalizing the size and composition of the balance sheet poses significant uncertainties and challenges for monetary policymakers.
I believe all of these statements to be true. They are also widely, if not universally, accepted.”
> Powell cites this one which is really bad (perhaps not surprisingly, it was edited by an
> economist from the German Finance Ministry)