VT - Dealing With The Next Downturn
Originally posted on January 27, 2020
Mary-Catherine Lader: Since the Global Financial Crisis, major central banks like the Federal Reserve in the United States and the European Central Bank in Europe have taken unprecedented steps to support the record-long economic expansion. Short-term interest rates are negative in Europe and Japan and interest rates are below 2% in all major economies. So unconventional policy has become conventional and yet that's still not enough. When the next downturn happens, most central banks will not have the same ammunition, specifically lowering short-term and long-term interest rates, to support