5 Matching Annotations
- Aug 2020
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www.theatlantic.com www.theatlantic.com
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Lowrey, A. (2020, March 31). We Need to Start Tossing Money Out of Helicopters. The Atlantic. https://www.theatlantic.com/ideas/archive/2020/03/we-need-start-tossing-money-out-helicopters/608968/
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www.nber.org www.nber.org
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Benmelech, E., & Tzur-Ilan, N. (2020). The Determinants of Fiscal and Monetary Policies During the Covid-19 Crisis (Working Paper No. 27461; Working Paper Series). National Bureau of Economic Research. https://doi.org/10.3386/w27461
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- Jun 2019
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www.investopedia.com www.investopedia.com
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To keep recession away, the Federal Reserve lowered the Federal funds rate 11 times - from 6.5% in May 2000 to 1.75% in December 2001 - creating a flood of liquidity in the economy. Cheap money, once out of the bottle, always looks to be taken for a ride. It found easy prey in restless bankers—and even more restless borrowers who had no income, no job and no assets. These subprime borrowers wanted to realize their life's dream of acquiring a home. For them, holding the hands of a willing banker was a new ray of hope. More home loans, more home buyers, more appreciation in home prices. It wasn't long before things started to move just as the cheap money wanted them to.
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- Aug 2017
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www.brookings.edu www.brookings.edu
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“throwing seniors under the bus” (to use the words of one senator) by keeping interest rates low.
Since interest rates are low, seniors who are trying to live off of their savings will be in trouble because their money doesn't earn anything for them.
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real interest rates are determined by a wide range of economic factors, including prospects for economic growth—not by the Fed.
Real interest rate = interest rate - inflation
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