PEN-L
mailing list archive
[ Other Periods  | Other mailing lists  | Search  ]
Date:  [ Previous  | Next  ]      Thread:  [ Previous  | Next  ]      Index:  [ Author  | Date  | Thread  ]

Re: RE: saving and aggregate demand

query: where did economists get the habit of ignoring the way in which
"paying down the government debt" reduces aggregate demand, along with the
phenomenon of fiscal drag?


Since the Federal Reserve made it clear that *it* was managing
aggregate demand, and that it could move faster and had more powerful
policy tools than the congress-plus-president.

In normal times, the Federal Reserve can undo whatever fiscal policy
action the congress-plus-president takes--and the Federal Reserve
does.

There is, however, the possibility of un-normal times to worry about...


Brad DeLong


[ Other Periods  | Other mailing lists  | Search  ]