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Fed should buy stocks if there is another steep recession, former IMF economist says
The Federal Reserve buying stocks? How about financing the federal deficit? Or buying goods? These were some of the suggestions for combating the next severe recession given to the central bank by former IMF chief economist Olivier Blanchard at the Boston Fed’s monetary policy conference over the weekend. There is a general sense the Fed has to re-think its approach to combating recessions given the low-interest-rate environment that is persisting. The problem facing the central bank is easy to describe. The Fed’s benchmark short-term fed funds rate is now around 2.875%. That’s not so much room to cut rates in ... (full story)