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Unformatted text preview: Week 6: Banking and Monetary Policy - Assignments 2010 What is the "current macroeconomic situation" (e.g. worrying about inflation and/or recession) in the U.S.? What should the U.S. Congress and the Federal Reserve do about it? The current macroeconomic situation in the U.S is recovering but not yet recovered. The overall concern is that the U.S. economy could drop into another recession creating a double bottom recovery pattern as opposed to a V shaped recovery. For anyone to strategically remedy the current macroeconomic situation where our supply exceeds our demand, political authorities can one stand by and allow asset prices to fall or they can increase the wages of the working public so that they can afford to buy. Among the effects of this economic crisis that the US was with the dramatic fall in wealth, severe disruptions of credit, devastation of state and local government budgets, much greater caution on the part of consumers and firms, and falls in output around the world. As a result of the decrease in wealth it of consumers and firms, and falls in output around the world....
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This document was uploaded on 01/26/2011.
- Spring '10