Authors: Skanda Amarnath & Sudiksha Joshi The previous post made the case for why the Evans Rule, when evaluated in the full context of fiscal austerity and a deleveraging household sector, was an underrated policy success. …

Author: Skanda Amarnath & Sudiksha Joshi While the Federal Reserve (Fed) cannot unilaterally deliver a swift recovery from the COVID-19 economic recession, it can still play a useful supporting role through its commitment to keep interest rates low. The Fed faces the same zero lower bound (ZLB) constraint that it…

Summary: The pricing of the Municipal Liquidity Facility (MLF) makes it virtually irrelevant for most municipal debt issuers because current market prices are well above those that the Federal Reserve (Fed) is offering. The success or failure of the MLF should be judged not solely by current municipal bond yields…

Authors: Skanda Amarnath (Employ America), Yakov Feygin (Berggruen Institute) State governments are on the front line of the COVID-19 pandemic and its economic fallout. In the coming weeks, they will be subject to increasing demands to expand healthcare capacity and support existing initiatives, all while tax revenue dries up and…

The impact of COVID-19 is likely to be sizeable. Regardless of the precise composition of the shock to supply and demand, further macroeconomic policy action is now necessary. The Fed can cut the benchmark Federal Funds Rate a few more times, but only Congress and the White House can provide…

The Fed now recognizes that its interventions have helped to create millions of jobs and promoted a better equilibrium in the long run. A deeper shift to its reaction function is now needed. Fed Communication Suggests Recognition Of A New Reality Chair Powell’s recent statements reveal a fundamental shift in…