Alp Simsek on a Risk-Centric View of Demand, Recession, and Speculation
Macro Musings with David Beckworth
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The Fed's Model of Asset Price Spirals and Aggregate Demand Amplification
The first thing the fed should do is of course cut the interest rates And then it to lower bound and when you when you hit the lower bound our model actually shows that when you don't do anything else these shocks can become a lot bigger. This leads to an even bigger increase in risk premium and even bigger Reduction risk prices and so onSo you can get into a very bad spiral kind of like what we saw in March where you get a huge dramatic essentially what happened in March.
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