Mar 18, 2020, 9:04 PM There’s never been a worse time for fiscal stimulus – Econlib econlib.org
There’s never been a worse time for fiscal stimulusSTIMULUS BY RATE OF RESPONSE AND EFFECT MONETARY stimulus refers to lowering interest rates, quantitative easing, or other ways of increasing the amount of money or credit. DIRECT stimulus (my term) refers to direct distribution of cash to consumers who can then alter the structure of production with collective (‘state’,’environmental’) indirect debt rather than individual, family, business and industry debt. this is the ONLY method of preventing exaggerated worldwide demand, network, and price recalculation, in the face of ignorance. Giving consumers liquidity removes IGNORANCE (uncertainty) while the economy changes. It is ignorance, uncertainty, and recalculation by trial and error under duress that causes undesirable economic contractions rather than desirable economic adaptations. DEBT NATIONALIZATION (my term) refers to paying down consumer credit all mortgages and granting credit to those with paid or substantially paid mortgages. RESCUE INVESTMENT (my term) – Providing loans directly to business industry in response to shocks, so that they can survive or even motball during recessions. NATIONALIZATION refers to the state taking over the ownership of a STRATEGIC industry, providing necessary cash reserves and cash-flow while the necessary organization adapts to shocks (temporary) or change (permanent). However, investors must be zeroed during this time and may only buy back their interest for having failed to preserve enough liquidity to insure against shocks. In this case the state buys the company for nothing, and resells it. FISCAL stimulus refers to increasing government consumption or transfers or lowering taxes. Effectively this means increasing the rate of growth of public debt, except that particularly Keynesians often assume that the stimulus will cause sufficient economic growth to fill that gap partially or completely. See multiplier (economics).