US monetary policy has done everything possible
On Thursday, Alan Greenspan, the former Fed chairman told that American monetary policy has hit its outward bounds of its effectiveness without another wave of quantitative easing.
From his point of view, there’s no solid evidence that America is getting a powerful impact on lending and on the national economy catching up with.
Greenspan added that he absolutely disagreed with Christine Lagarde, the IMF Managing Director that negative interest rates generate a net upbeat impact. By the way, some European and Japanese policymakers have pushed their key rates into negative territory.
Alan Greenspan explained that negative interest rates really hurt because financial intermediaries need exactly positive rates. On the other hand, we shouldn’t blame negative rates themselves, we’d better stay away from the polices, which got us where we’re now.
Anemic productivity growth as well as flagging corporate revenues can be traced to entitlement spending because the global population gets older. Fundamentally, it’s a pure political problem.