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>One thing that make that statement less impactful is that we now have tools to prevent recessions. Such as? We seem to be pulling all possible levers and are

>One thing that make that statement less impactful is that we now have tools to prevent recessions. Such as? We seem to be pulling all possible levers and are still barreling into a recession at full speed.

kmonsen 4y ago
What? This is a created recession as I see it. If we wanted to avoid this recession we would reduce the loan rate and increase the money supply. Not saying that would be smart.
dragonwriter 4y ago
> We seem to be pulling all possible levers and are still barreling into a recession at full speed. The Fed is pulling fairly hard (but far from maximally hard, because there is considerable concern about policy overshoot) on the anti-inflation monetary policy levers. Those are also the ones that cause, rather than fight, recessions. They are doing this because pulling hard on the anti-recession levers due to the hard and fast COVID recession lead to an equally hard and fast rebound with skyrocketing inflation. Congress is basically sitting on its hands on major fiscal policy levers, having returned to a basic neutral stance after fairly heavy anti-recession stimulus during the COVID recession. (If we really wanted to manage inflation while avoiding recession, we’d probably want Congress taking more targeted anti-inflation fiscal action aimed at the specific sectors driving overall inflation, so that the Fed could take a lighter hand on broad-focus anti-stimulative measures; if we just wanted to avoid recession in the near term period, we’d focus on stimulus and damn the torpedoes of inflation; but I don't think that would be wise.) We are very, very far from pulling all possible levers to prevent a recession.
mancerayder 4y ago
The solution is austerity, but no one wants to cut spending and risk losing votes. Large spending packages contributed to inflation and were partly a calculated giveaway by both parties.

kmonsen 4y ago

What? This is a created recession as I see it. If we wanted to avoid this recession we would reduce the loan rate and increase the money supply. Not saying that would be smart.

dragonwriter 4y ago

> We seem to be pulling all possible levers and are still barreling into a recession at full speed. The Fed is pulling fairly hard (but far from maximally hard, because there is considerable concern about policy overshoot) on the anti-inflation monetary policy levers. Those are also the ones that cause, rather than fight, recessions. They are doing this because pulling hard on the anti-recession levers due to the hard and fast COVID recession lead to an equally hard and fast rebound with skyrocketing inflation. Congress is basically sitting on its hands on major fiscal policy levers, having returned to a basic neutral stance after fairly heavy anti-recession stimulus during the COVID recession. (If we really wanted to manage inflation while avoiding recession, we’d probably want Congress taking more targeted anti-inflation fiscal action aimed at the specific sectors driving overall inflation, so that the Fed could take a lighter hand on broad-focus anti-stimulative measures; if we just wanted to avoid recession in the near term period, we’d focus on stimulus and damn the torpedoes of inflation; but I don't think that would be wise.) We are very, very far from pulling all possible levers to prevent a recession.

mancerayder 4y ago

The solution is austerity, but no one wants to cut spending and risk losing votes. Large spending packages contributed to inflation and were partly a calculated giveaway by both parties.