Must-read: David Wessel: “Are We Ready for the Next Recession?”

Must-Read: David Wessel: Are We Ready for the Next Recession?: “Financial markets seem to be anxious that a U.S. recession is on the horizon…

…even though economic forecasters disagree. When the next recession arrives, will fiscal and monetary policy be able to respond? If so, how? The Federal Reserve is holding short-term interest rates near zero and faces resistance, internally and externally, to reviving large-scale purchases of assets. The federal debt is larger, as a share of the economy, than at any time since the end of World War II and is projected to climb further. On March 21, the Hutchins Center on Fiscal and Monetary Policy will consider which fiscal and monetary policy tools will be available in the event of a recession—and which won’t—and how effective additional fiscal and monetary stimulus is likely to be, along with new ideas to make fiscal policy more effective…. David Wessel… Wendy Edelberg… Ben Spielberg… Phillip Swagel… Richard Clarida… Jon Faust… Louise Sheiner… Jared Bernstein