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Fed’s Kashkari Urges Congress to Hand Out More Free Money

Summary:
Federal Reserve Bank of Minneapolis President Neel Kashkari told CBS’s “Face the Nation” that Americans are saving more because they aren’t going out as much during the pandemic, and as a result there would be less need to borrow from abroad to finance additional fiscal aid. “So while historically we would worry about racking up too much debt, we’re generating the savings ourselves. That means Congress has the resources to support those who are most hurting,” he said. “Right now the U.S. can fund itself at very, very low rates. Congress should use this opportunity to support the American people and the American economy.”“If we were to lock down hard for a month or six weeks, we could get the case count down so that our testing and our contact tracing was actually enough to control it,”

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Federal Reserve Bank of Minneapolis President Neel Kashkari told CBS’s “Face the Nation” that Americans are saving more because they aren’t going out as much during the pandemic, and as a result there would be less need to borrow from abroad to finance additional fiscal aid.

“So while historically we would worry about racking up too much debt, we’re generating the savings ourselves. That means Congress has the resources to support those who are most hurting,” he said. 

“Right now the U.S. can fund itself at very, very low rates. Congress should use this opportunity to support the American people and the American economy.”

“If we were to lock down hard for a month or six weeks, we could get the case count down so that our testing and our contact tracing was actually enough to control it,” Kashkari said.

“If we don’t do that, and we just have this raging virus spread throughout the country with flare-ups and local lockdowns for the next year or two, which is entirely possible, we’re going to see many, many more business bankruptcies.”

The Fed hollers every time Trump or Congress meddles in monetary policy, but the Fed repeatedly meddles in fiscal policy. 

And here's a new one: The Fed is willing to interject its beliefs about medical policy as well.

Mike Shedlock
Mike Shedlock (Mish) is a registered investment advisor representative for SitkaPacific Capital Management (http://www.sitkapacific.com/). Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.

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