3 years ago
Moments of clarity in a sea of noise
On the monetary policy side, future policymakers might choose to consider some additional tools that have been employed by other central banks, though adding them to our toolkit would require a very careful weighing of costs and benefits and, in some cases, could require legislation. For example, future policymakers may wish to explore the possibility of purchasing a broader range of assets. Beyond that, some observers have suggested raising the FOMC’s 2 percent inflation objective or implementing policy through alternative monetary policy frameworks, such as price-level or nominal GDP targeting. I should stress, however, that the FOMC is not actively considering these additional tools and policy frameworks, although they are important subjects for research.This key message was obscurely packed into a bunch of esoteric back filling, but more importantly hints that helicopter money is coming. It is the last resort for desperate central banks trying to re-inflate the economy in a deflationary environment which every Keynesian economist fears. "Broader range of assets" indicates buying not just US Treasury bonds (quantitative easing), but also equities, corporate bonds, real estate, and eventually leads to giving away free tax deductions to the masses. Money and credit figuratively rain down at every level: household, corporate, government. Hence, the term "helicopter money" is coined due to the massive liquidity injected into the economy.
...the Federal Reserve Bank of San Francisco that finds that "higher minimum wage results in some job loss for the least-skilled workers—with possibly larger adverse effects than earlier research suggested."Gee, the academics and intelligentsia are finally coming to the same conclusions the rest of us peons came to years ago.