Economics, Econometrics and Finance
4 years ago

Debt Crisis Looms: Monetary Policy Powerless in Face of Fiscal Crunch.

National Bureau of Economic Research
Crunch Time: Fiscal Crises and the Role of Monetary Policy
D. Greenlaw, James D. Hamilton, Peter Hooper, Frederic S. Mishkin

Paper Summary

Countries with high debt and ongoing deficits can face serious financial problems due to rising interest rates. This can lead to a fiscal crisis, making it harder for the US to manage its budget. The Federal Reserve may also struggle financially, potentially leading to losses and an inability to provide funds to the US Treasury.

Related papers

Economics, Econometrics and Finance
8 years ago

Romania's Budget Crisis: Fiscal Policy Key to Economic Recovery

Infrastructure Impact
Fiscal Policy
2 views
Economics, Econometrics and Finance
8 years ago

India's Rising Debt Levels Pose Risk of Sovereign Default Crisis

Fiscal Policy
International Finance
Infrastructure Impact
Economics, Econometrics and Finance
4 years ago

New Debt Strategies Boost Fiscal Space Without Austerity, Fueling Economic Growth

Fiscal Policy
Infrastructure Impact
1 view