The coronavirus pandemic, and the ensuing economic crisis, has provoked unprecedented responses from policy makers, no more so than from central banks. The Federal Reserve’s major actions include purchasing up to $750 billion of investment-grade corporate debt and lowering its discount window rate to 1.5% – lower than it ever was in the GFC. This makes the Fed’s additional pledge to buy $700 billion in … Continue reading Lessons from the crash and today’s trends in Western monetary policy

“Now this is not the end. It is not even the beginning of the end. But it is perhaps the end of the beginning”. These famous words delivered by Winston Churchill after the defeat of the Germans at Alamein in 1942, marked a turning point in WWII. Such words would be apt today in the “world war” against COVID-19. The first phase of the shock is … Continue reading Has Covid-19 let the MMT genie out of the bottle?

Has the coronavirus proven the existence of the magic money tree? Theresa May, in response to an NHS nurse who hadn’t received a pay rise in eight years, asserted that “there isn’t a magic money tree” during a 2017 election special of Question Time; on the 20th of March 2020, Rishi Sunak introduced the Coronavirus Job Retention Scheme that is estimated to cost around £78bn, … Continue reading Modern Monetary Theory Revisited

All over the world, schools have closed down as part of strict lockdown measures designed to slow the spread of Covid-19. According to UNESCO, over 90% of the world’s pupils have been affected by these closures. Yet for such drastic action, the supporting evidence is at best dubious. Studies have shown that school closures will do little to halt the spread, with UCL calling it … Continue reading Lost Potential: School closures’ devastating effects

Protectionist policies are typically exercised by countries in order to protect domestic industries from foreign competition. Protectionism is usually expressed in the form of tariffs on foreign imports, subsidies, regulatory blocks and import quotas, alongside other restrictions placed on foreign trans-national corporations. Governments often implement protectionist measures in order to protect domestic industries and firms. This is especially true when there are levels of high … Continue reading Protectionism: The impact on a country’s development