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Federal Reserve Bank of Richmond
Richmond Fed Economic Brief
Unsustainable fiscal policy : implications for monetary policy
Renee Courtois Haltom
John A. Weinberg
Abstract

The debt of the U.S. government is at historically high levels, but how do we know whether debt levels are worrisome? This Economic Brief argues that the current fiscal position is not sustainable. Though financial markets seem unconcerned, for the time being, about U.S. fiscal health, as evidenced by low rates on Treasury securities, lawmakers should not be complacent. Expectations are liable to change as large fiscal imbalances persist, with potentially devastating consequences for the U.S. economy and monetary policy.


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Renee Courtois Haltom & John A. Weinberg, "Unsustainable fiscal policy : implications for monetary policy" , Federal Reserve Bank of Richmond, Richmond Fed Economic Brief, issue Jul, 2012.
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Keywords: Fiscal policy ; Monetary policy
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