More from Treasury Secretary Yellen
- critically important that fiscal policy be responsible
- important that policy not impose tax increases on future generations.
- Budget to be presented on Friday.
- Budget will increase debt to GDP ratio a bit.
- Real interest rate cost on federal debt is currently negative at current rates.
- We have a problem in terms of deficits after 2030 due to an aging population.
- Inflation we have seen in recent months have to do with supply shortages and bottlenecks as we get back to pre-pandemic full employment, it will be appropriate for interest rates to rise above current rock-bottom levels
- Biden budget assumes that over time, rates will revert to low but more normal levels
- Biden is proposing investments that will increase long run supply potential boost labor force participation
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