Discover and read the best of Twitter Threads about #FiscalPolicy

Most recents (24)

1/12 📢 BREAKING: The #Puntland Government of #Somalia has issued a comprehensive proposal on solutions to the challenges of the state-building process in the country.…
2/12 #Puntland has raised concerns over the Federal Government's lack of political will & systematic delays in reaching negotiated political settlements, and now opts for bilateral negotiations. #SomaliPolitics
3/12 The proposal outlines ten key challenges facing the state-building process, and offers potential solutions to each. Here's a breakdown: #SomaliaStateBuilding
Read 12 tweets
He has BLOCKED me but @profholden once asked for a “formal theory” of MMT. Well here it is.
The model examines two claims of Modern Monetary Theory: 1) The government determines the price level through the prices it pays when it spends. 2) Deficient demand results when the government does not supply enough currency to meet private demand. #MMT 🏛️💸
The model builds a "monopoly money" framework where the government sets the "price of money" through its spending. While private actors recirculate government currency, they depend on the government as the monopoly supplier. #MonopolyMoney 💰📈
Read 11 tweets
The requirement for #fiscalpolicy is to find the right balance between flexibility to respond to changing socioeconomic circumstances and the credibility to maintain control of #debt.



Rules-based policies matter for credibility as they impose both external and internal discipline, help ensure economic agents condition on the govt’s plans and allow us to understand progress relative to the plan, as we outlined in our research back in the spring of 2021 👆

We suggest five main proposals for a new #fiscalframework which seeks to address the current deficiencies:

1⃣ ▶️ The #Chancellor should set out a structured timetable for fiscal events and deliver a #Budget speech focused on the state of the economy and the

Read 8 tweets
What really causes inflation? 🧵

[a thread for normies - like me]
2/ The problem with #inflation is that it's a very personal experience.

As I always say, the wallet is the most sensitive organ in the body, so my inflation might not be your inflation.

In fact, my inflation could be seen as #disinflation by you... (more on that later)
3/ Price inflation and monetary inflation have different definitions:

* For many.- #inflation is the increased prices paid for goods & services.

** To others.- it's a decline in the purchasing power of your #money.

*** In layman's terms.- Too much money chasing too few goods.
Read 25 tweets

"The historical linkage between corporate tax rates and investment growth is non-existent [almost zero, but the correlation] between [interest] rates and investment actually has the wrong sign [they're positively correlated]"

#capex #macro #fiscalpolicy Image

"when profits are growing, so does investment [which] also shows a stronger connection with growth expectations – when CEOs expect stronger growth they also are planning higher levels of capex growth"

Read 4 tweets
Speeches are an important element of central bank communication. After two years at the @ecb’s Executive Board, I would like to present a selection of the most relevant of my (more than 30) speeches in a long thread🧵. 1/18
There are several categories of speeches: (1) on #MonetaryPolicy, explaining current policy considerations, (2) on #Narratives about monetary policy, and on the relationship of monetary policy & (3) #FiscalPolicy, (4) #FinancialStability, (5) #Inequality, (6) #ClimateChange. 2/18
#MonetaryPolicy: There are too many speeches to list them all, so let me select a few: on the ECB’s response to the pandemic (6 Apr 2020), mentioning (AFAIK) the concept of the euro area GDP-weighted yield curve for the first time: 3/18…
Read 18 tweets
Interesting Paper from @blackrock from June 2019

Relates to the need for monetary policy in coordination with fiscal
#monetarypolicy #fiscalpolicy #Fed #economics
#bitcoin #BTC #inflation…
"An extreme form of “going direct” would be an explicit and permanent monetary financing of a fiscal expansion, or so-called helicopter money. Explicit monetary financing in sufficient size will push up inflation."
"Without explicit boundaries, however, it would undermine institutional credibility and could lead to uncontrolled fiscal spending."
Read 5 tweets
New #Blog «#FiscalPolicy to drive the recovery in #LatinAmerica: the “when” and “how” are key» @voxlacea @OECD_Centre
For fiscal policy to be effective it needs a well-defined sequencing of actions and to be backed by consensus
Here the thread 🧵:
The political economy of fiscal policy is more important than ever and country-specific characteristics calls for a tailored approach. However, some overarching considerations can help countries in #LAC get their “policy menu” between public spending, tax policy and public debt. ImageImageImage
- Moving towards the expansion of well-targeted social exp. with long-term economic effects
- More and better capital exp. to close the infra. needs incl. digital+green
- Innovative fiscal frameworks incl. fiscal rules to ensure fiscal sustainability with adequate escape clauses Image
Read 5 tweets
Daily Bookmarks to GAVNet 05/30/2021…
Solar Storms Are Back, Threatening Power Grids and Satellites…

#SolarStorms #PowerGrids #satellites #consequences
As Covid dissipates in the U.S., cold and flu viruses may return with a vengeance…

#COVID19 #colds #flu #CaseCounts #estimates
Read 10 tweets
Daily Bookmarks to GAVNet 02/28/2021…
Living The Good Life In A Non-Growth World: Investigating The Role Of Hierarchy, Part 2…

#hierarchy #living
Germany has more than 1 million Covid-19 vaccines unused in storage…

#germany #COVID19 #vaccines #distribution #injections
Read 8 tweets
🚨*𝐍𝐈𝐄𝐒𝐑 𝐁𝐮𝐝𝐠𝐞𝐭 𝟐𝟎𝟐𝟏 𝐂𝐡𝐚𝐫𝐭𝐩𝐚𝐜𝐤* 🚨

All you need to know ahead of next week's #Budget in one... THREAD 👇

The #Budget2021 comes at a critical time when the UK is in the middle of battling the #pandemic and the economy is substantially weakened with uneven effects at industry, household & region level.

Read the economic context to #Budget2021 here 👇

We project the UK economy to contract again in 2021Q1 due to the second wave and the winter #lockdown as well as the effects of post-#Brexit adjustment, bringing #GDP to some 11% below pre-#pandemic levels

Read 19 tweets
.@JanetYellen at Senate Finance Committee hearing in response to @SenWhitehouse on #climatechange: "I will look to appoint someone at a very senior level to lead our efforts and to create a hub within @USTreasury in which we particularly focus on ... (1/4)
... financial system-related risks and #taxpolicy incentives toward climate change. I think we need to seriously look at assessing the risks to the financial system from climate change. The @federalreserve has recently said that they would be joining the @NGFS_ They are ... (2/4)
... developing methodologies to do that and we'll focus on that. ... climate change is an existential threat, and both the impact of climate change itself and policies to address it could have major impacts creating ... (3/4)
Read 4 tweets
I am humbled and privilleged to note that my #Research paper; "Sources of #Unemployment in #Lesotho" is now available and can be accessed via the People's Republic of #China's National #Science and #Technology #Library - #NSTL. I give thanks 😎 Image
So far this year, I have successfully published three #Research articles in #Macroeconomics & #Finance, with another two in press. I am currently hammering away at a handful of working papers which will most certainly find a home in reputable #Journals, come 2021 🙏🏽🙂 Image
Im currently internalising the very insightful reviewer comments on my latest #Research paper titled; "Investigating Determinants of Commercial Bank Spreads in #Lesotho", from the good folks over at the globally reputable #International #Journal of #Finance & #Economics #IJFE 😊 ImageImage
Read 52 tweets
Think of #Government this way: it exists to smooth economic activity over the cycle (ups & downs). Ergo, it exists for no other reason but to ensure output is close to or at full potential. Efficient resource allocation & redistribution are neccesary but insufficient condition.
Government has two levers it can pull on to honour this so called "social contract". These are Revenue (taxes) & Primary Spending (consumption & investment). In a downturn, as in an upturn, #FiscalPolicy is an automatic and/or deliberate toggle of those two levers...
Ideally, government is expected to always note where the economy is on the cycle (early, mid, late cycle etc) to execute efficient #FiscalPolicy. Should government miscalculate the position, fiscal policy could be misguided (e.g. loose when should be tight)...
Read 7 tweets
THREAD: A recent paper by Yu Yongding and Zhang Yi on monetary financing in China:… 1/5
#monetarypolicy #fiscalpolicy #COVID19 #economicstimuluspackage
In this paper, the authors first analyzed the impacts of two approaches to fiscal deficit financing (issuing government bonds and monetary financing), then further evaluated the possibility of adopting these approaches in China and their pros and cons. 2/5
They suggest China take the following order when choosing financing approaches:1, issue government bonds to non-banking financial institutions (general public); 2, issue government bonds to commercial banks; 3, launch the Chinese version of QE; 4, monetary financing. 3/5
Read 5 tweets
A recent paper by Yu Yongding and Zhangyi on monetary financing in China:…
#monetarypolicy #fiscaldeficit #fiscalpolicy
In this paper, the authors first analyzed the impacts of two approaches to fiscal deficit financing (issuing government bonds and monetary financing), then further evaluated the possibility of adopting these approaches in China and their pros and cons.
They suggest China take the following order when choosing financing approaches: 1, issue government bonds to non-banking financial institutions (general public); 2, issue government bonds to commercial banks; 3, launch the Chinese version of QE; 4, monetary financing.
Read 5 tweets
COVID-19 is an unparalleled economic crisis in modern history. My colleague @tulsipriya_rk and I have been tracking the macroeconomic effects of it on India’s economy on a weekly basis. Sharing some of the visualisations here in this thread.
#MacroOfCovidIndia Image
Globally, India’s workplace mobility rising relatively faster from a low base since Lockdown 3.0. Mobility levels to retail and recreation still 70% below baseline. #MacroOfCovidIndia @tulsipriya_rk Image
India's mobility to work places, grocery, pharmacy and transit stations picking up since 3rd May while visits to parks, retail and recreation spots remain low. @tulsipriya_rk Image
Read 22 tweets
With a strong stimulus package and a contained virus, #China’s growth prospects for 2020 are not yet lost, said Yu Yongding via East Asia Forum:…
In real terms, China’s 2019 #GDP was 19.7 trillion RMB in 2019 Q1 and 69.45 trillion RMB in the remaining 3 quarters. Official figures place China’s GDP at 18.4 trillion RMB in 2020 Q1.China’s GDP grew 6.1% in 2019.
Assuming that China maintains a real growth rate of 6% in the remaining 3 quarters of 2020, the annual growth rate will be about 3.2%. But the #COVID19’s unpredictability makes any economic forecasts problematic. China also has to be vigilant against a resurgence of the virus.
Read 6 tweets
The @ecb response to #COVID19.

My new blog (link below) and a thread on what #centralbanks should do to face the crisis

In short
- Households & firms need massive emergency #credit to cope with #COVID19
- #centralbanks are critically accommodating credit markets
- CBs must guarantee sustainable credit conditions
- CBs must ensure that credit go where it's needed
- #HelicopterMoney is option
#fiscalpolicy is crucial to ensure most vulnerable get the help needed. Ambitious fiscal plans have been pledged.

Volume and price countries get on markets is key to scale-up public response to #COVID19 and for #sustainability of sovereign debt.

Read 9 tweets
Lets talk about #Global #CentralBanks and their #MonetaryPolicy stances given #COVID19. Specifically, lets ask ourselves: "Can Central Banks Help Fight COVID-19?"
The best place to start is to note that #Global #Growth was already facing considerable downside risks before the #COVID19 outbreak December 2019. The slow down in global growth came on the back of trade (china vs. us) and geopolitical (Brexit etc.) tensions...
To this end, institutions such as the #IMF & #WorldBank revised down their 2020 #Economic #Growth outlook & emphasised the need for a more coordinated #policy approach between #monetary & #fiscal policy around the globe to "rescue" growth from the doldrums...
Read 14 tweets
We saw a modest 0.1% gain in headline #CPI this morning, a slightly firmer 0.2% gain in core CPI, yet already this report is a story of “that was then, and this is now,” since the #coronavirus and #oil price shock are altering the #economic landscape.
Fascinatingly, the decline in inflation #breakevens implies a world that simply doesn’t believe #inflation is rising, and based on market pricing, instead believes it is falling quickly toward not only short-term, but even longer-term, #disinflation.
We think the disinflationary story told by #TIPS markets is probably overdone and note that even before the Saudi/Russian #oil production dispute, and before the coronavirus’ #economic impact, the fundamentals in the oil market were already displaying signs of deterioration. Image
Read 4 tweets
From the perspective of policy tools, #fiscalpolicy should play a leading role.…
Fiscal policy is endowed with precise orientation, temporariness and limited latency; suitable for dealing with one-time and short-term shocks of the #epidemic, according to Zhang Bin, Senior Fellow of CF40.
Issuing special #treasurybonds as soon as possible to fill the gap between government revenue and expenditure is the key guarantee to prevent the broad credit from collapsing and the secondary damage due to the gap between local government’s revenue and expenditure.
Read 6 tweets
Lets talk about John Maynard #Keynes and his #Passion for #Art...
John Maynard #Keynes is perhaps most famous for his 1936 Magnum Opus, The General #Theory of #Employment, #Interest, and #Money in which he argued for a more active role of #FiscalPolicy in #Macroeconomic management...
It is hardly disputable that #Keynes' work, and his subsequent roles during the #BrettonWoods era marked a significant intellectual shift in the way we have come to understand #Economics as a discipline...
Read 11 tweets

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