This article is only available to Macro Hive subscribers. Sign-up to receive world-class macro analysis with a daily curated newsletter, podcast, original content from award-winning researchers, cross market strategy, equity insights, trade ideas, crypto flow frameworks, academic paper summaries, explanation and analysis of market-moving events, community investor chat room, and more.
Bernanke and Yellen: the Federal Reserve Must Reduce Long-term Damage From Coronavirus (FT, 5 min read) With the underlying cause of the current crisis very different to 2008 reviving parts of the GFC toolkit cannot fully counteract current economic stress. Policymakers must employ measures to ensure the economy can rebound quickly – such as ensuring credit is available for healthy businesses – part of which is by purchasing corporate bonds (article from 18 March and therefore before the latest Fed measures).
Why We May Need Helicopter Money (OMFIF, 3 min read) With the self-employed accounting for 15% of Britain’s labour force the UK should, according to former Chancellor Normal Lamont, turn to helicopter money to avoid further hardship. Universal credit and statutory sick pay do not go far enough.
A Proposal for a Covid Credit Line (VoxEU, 5 min read) Using the ESM for a new long-term Covid Credit Line would circumvent the problem of no joint debt issuance in the EU while allowing the worst effected economies access to credit, the cost of which would not be linked to individual fiscal positions.