Lyn Alden is very knowledgeable on most macro topics I find.
As far as limits on fiscal policy go, I had heard the theory advanced (for the US anyway), that the Fed could continue to buy US govt debt indefinitely (if necessary to pay the interest on the US debt) because of global demand for the USD. The (US) dollars would be in demand from overseas so would make their way out of the US economy and lessen the inflationary impact.
I don't know that it would hold true for any other country (eg Australia) though, as AUD is only used in Australia. I imagine that would put limits on Australia's ability to print AUD to pay the interest on it's govt because the ongoing fiscal stimulus would bring the new AUD into the economy and cause inflation. The AUD would not make their way offshore as in the case of the USD printed by the Fed. So yes any country other than the US would be limited in their capacity to use fiscal policy imo.
- Forums
- Economics
- Inflation and deflation at the same time
Inflation and deflation at the same time, page-26
-
- There are more pages in this discussion • 85 more messages in this thread...
You’re viewing a single post only. To view the entire thread just sign in or Join Now (FREE)
Featured News
Featured News
The Watchlist
SBW
SHEKEL BRAINWEIGH LTD
Dani Nadri, Country Manager Australia
Dani Nadri
Country Manager Australia
SPONSORED BY The Market Online