Fiscal vs Monetary Policy

“Observers… speculate what may happen to the American economy if lawmakers implement similar austerity measures to tackle the deficit quickly. Many economists … have instead said officials need to get the economy on a long-term sustainable path without cutting too much in the short term and putting the economy back in a ditch.”

• Fiscal Policy

• Monetary Policy

“…The Fed has identified achievement of ‘substantial’ improvement in the labor market outlook as its main criterion for ending asset purchases. Beyond that, the FOMC has set a 6.5% unemployment threshold for starting to raise the federal funds rate.”

• Fiscal Policy

• Monetary Policy

“Several… policymakers recently have suggested that they’re inclined to support more bond purchases if the …economy doesn’t pick up.

• Fiscal Policy

• Monetary Policy

“The plan Obama sent to Congress today asks for more money for jobs, highways and bridges, schools, student aid and manufacturing research as well as higher taxes for corporations, banks and oil, natural gas and coal companies.”

• Fiscal Policy

• Monetary Policy

“...Officials decided to announce they would keep interest rates near zero until the unemployment rate drops to 6.5%.”

• Fiscal Policy

• Monetary Policy

“The 2013 budget … included job-creation initiatives for infrastructure, job-training and innovation”. To offset the cost, it “called for raising $1.5 trillion over 10 years from the wealthiest taxpayers and from closing some corporate tax breaks, chiefly for oil and gas companies.” 6

• Fiscal Policy

• Monetary Policy