You can see how central bank reserve shifting worked to lower the euro vs the dollar.
Yes, we need a larger deficit, both short and long term, given current institutional structure that gives powerful incentives to not spend income. Not that the current proposals to do that are my first choice as to specific taxes to cut and expenditures to increase. Nor would I call it pump priming, but instead I’d call it removing fiscal restrictions:
The president and his interviewer engaged in an exchange over the term “prime the pump.” It’s a commonly used phrase in economic circles and refers to spending, usually at the public level, to get the economy moving again. In addition to the tax cuts, Trump has advocated what could be $1 trillion in spending on infrastructure projects.
The term also is used to describe the classic Keynesian approach, something more closely associated with liberal Democratic philosophy than the conservative Republican train of thought that Trump professes to follow.
Interestingly, Trump said he was unfamiliar with “prime the pump” in economic terms.
“Have you heard that expression used before? Because I haven’t heard it,” he said. “I mean, I just … I came up with it a couple of days ago and I thought it was good. It’s what you have to do.”
Seems q2 GDP forecasts all coming down: