Tuesday, October 7, 2014

Secular Stagnation And Fed Policy Problems

This article provides a good definition of secular stagnation.  The Fed has been trying to deal with that problem while it is at the zero lower bound.  It has been using unconventional policies because short term nominal interest rates cant fall below zero.  Japan has been faced with that problem for decades. The question is whether western economies will be constrained by the liquidity trap for a similar period of time.  It is a good lead to the following post which includes a discussion of secular stagnation.

No comments:

Post a Comment