While the Federal Reserve is close to announcing additional measures to
stimulate the economy, there is little left that the central bank can do
to constrain the threat of another recession, according to Peter
Morici, professor at the Smith School of Business at the University of
Maryland and former chief economist at the U.S. International Trade
Commission.
The Fed has already done all the actions that might make a difference,
and short-term interest rates, including the overnight bank-borrowing
rate and the one-month and one-year Treasury bills, are already close to
0 percent.
Moreover, the yields on 30-year Treasurys and mortgage rates are near
record lows, so any additional Fed measures would not be effective, he
wrote on his website.
Yet, the economy is growing at less than 2 percent, and jobs creation is not even keeping up with the population growth.
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