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Even if the next recession is mild, the US has very little room for a stimulus thanks our debt. It's hard to predict the depth of a future recession, but one ca

by tabtab 7y ago

Even if the next recession is mild, the US has very little room for a stimulus thanks our debt. It's hard to predict the depth of a future recession, but one can say for sure that we have fewer options because of the debt. Keynesian principle is basically a fancy form of "save up for rainy days". We didn't, so hope the storm is short.

MuffinFlavored 7y ago
$4t was printed to bail out the banks. What is stopping more money from being printed this time, in the form of economic stimulus?
- 1PlayerOne 7y ago
  (Hyper)Inflation?
- tabtab 7y ago
  If you mean "Quantitative Easing", it's arguable whether it's the same as "printing money". I won't get into that debate here. In a related issue, there's a theory making its circles in both right and left camps that if inflation is sub-par for a while, say below 2%, then printing more money won't cause problems. Why inflation is lower than expected is an economic puzzle. But printing money to avoid paying debt may create new economic puzzles. If they try it, try it gradually please. (The ideal annual inflation rate tends to be around 2.0% to 2.3%, based on historical record. This is in aggregate. Highs or lows tend to affect different people differently.)