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By Hans Bevers, Chief economist Banque Degroof Petercam
Nearly eight years after the start of the Global Financial Crisis, global economic activity remains subdued and inflation mostly surprises on the downside. In general, despite record low policy rates and unseen expansion of the monetary base, central banks continue to struggle to meet their inflation targets. Encouragingly, a global shift away from budgetary austerity is underway. That said, talk is still cheap. More fiscal stimulus is what the doctor would order when monetary policy is constrained by the zero lower bound.
Evidence from recent experiences in Japan and the Great Recession have been proving Milton Friedman wrong. Friedman argued that monetary policymakers could always...
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