Comment: Biden may bring general mobilization of US fiscal and financial policies beyond expectations

category:Finance
 Comment: Biden may bring general mobilization of US fiscal and financial policies beyond expectations


Perhaps Yellen himself did not expect that, as an ideological exploration of the restoration policy after the Lehman crisis, it would be a very suitable experimental opportunity because of the return of the new epidemic in four years. At that time, her idea was that from the perspective of enterprises, if the state of insufficient demand (low-pressure economy) continued, it would inevitably lead to employers cautious adoption of formal jobs, and then the macro supply capacity growth would become very weak. After the Lehman crisis, the investment in R & D and equipment of American enterprises declined sharply, and the scale and speed of U.S. entrepreneurship also decreased significantly during her stay in the Federal Reserve. It can be said that this observation is the starting point of Yellens new ideas or her biggest problem consciousness. On this basis, as the chairman of the Federal Reserve, she challenged the economic consensus within FOMC at that time: even if it was difficult to obtain accurate statistical support, the potential supply capacity was not unrelated to demand. As long as the strong aggregate demand and the tight supply-demand relationship in the labor market continue to be maintained, the investment willingness of enterprises may be improved, and the labor force will be induced to return to the labor market, while the original workers will get better working conditions (promotion and salary increase or job hopping to better positions), then the economy will enter a positive cycle. In particular, the improvement of labor conditions can maintain the housing conditions of American workers, which forms a support for housing prices. The stability of housing prices has a positive impact on the credit ability of workers, so it has a stimulating effect on consumption expectation and ability, so it may get rid of the deflationary pressure. In that speech, Yellen also explained that this policy needs the support of monetary and fiscal policies for a relatively long time. When the former Fed chairman turns to be the head of fiscal policy, this will undoubtedly enhance the potential for dialogue and coordination between the Federal Reserve and the financial sector. In addition, this policy has a strong attraction to the demands of ethnic minorities in the Democratic Party, so the possibility of transforming it into a practical policy will be greatly enhanced. Considering that Bidens 10-year plan is $5.6 trillion, and that of bittrumps $4.94 trillion is not much different. Compared with Yellens and other team members nervousness about the epidemic, we are likely to see a more than expected mobilization of US economic policies in the future. This article is from Wang Xiaowu, editor in charge of economic report in the 21st century_ NF

Perhaps Yellen himself did not expect that, as an ideological exploration of the restoration policy after the Lehman crisis, it would be a very suitable experimental opportunity because of the return of the new epidemic in four years. At that time, her idea was that from the perspective of enterprises, if the state of insufficient demand (low-pressure economy) continued, it would inevitably lead to employers cautious adoption of formal jobs, and then the macro supply capacity growth would become very weak. After the Lehman crisis, the investment in R & D and equipment of American enterprises declined sharply, and the scale and speed of U.S. entrepreneurship also decreased significantly during her stay in the Federal Reserve. It can be said that this observation is the starting point of Yellens new ideas or her biggest problem consciousness. On this basis, as the chairman of the Federal Reserve, she challenged the economic consensus within FOMC at that time: even if it was difficult to obtain accurate statistical support, the potential supply capacity was not unrelated to demand. As long as the strong aggregate demand and the tight supply-demand relationship in the labor market continue to be maintained, the investment willingness of enterprises may be improved, and the labor force will be induced to return to the labor market, while the original workers will get better working conditions (promotion and salary increase or job hopping to better positions), then the economy will enter a positive cycle. In particular, the improvement of labor conditions can maintain the housing conditions of American workers, which forms a support for housing prices. The stability of housing prices has a positive impact on the credit ability of workers, so it has a stimulating effect on consumption expectation and ability, so it may get rid of the deflationary pressure.