Evan A. Schnidman: When Will the U.S. Hit The 1947 Wall?Roundup: Historians' Take
tags: economic history, inflation, 1947, Evan A. Schnidman
Evan A. Schnidman is a Ph.D. candidate at Harvard University studying how politics and finance play a role in central-bank decision making. He is also the founder and primary author of FedPlaybook.com, a central bank forecasting and analysis resource for investors.
After a decade of financial struggle and a severe crisis in Europe that caused a massive ripple effect around the world, the United States found itself engaging in unprecedentedly loose monetary policy to finance public debt. You might have guessed I was describing the economy at the start of 2013, but despite financial prognostications that 2013 will be a good year for the U.S. economy, the parallels between the U.S. economy in 1947 and in 2013 are quite stark.
During and immediately after World War II, the Fed maintained extremely low interest rates in order to reduce war-financing costs for the government. As these policies became unnecessary and inflationary after the war, the Fed was compelled by the Treasury to maintain the low cost of debt. The result of this highly accommodating monetary policy was 14 percent inflation in 1947 and rising unemployment that persisted into the early 1950s....
comments powered by Disqus
- "I've studied the history of Confederate memorials. Here's what to do about them."
- Annette Gordon-Reed writes about why Jefferson matters more than ever after Charlottesville
- Harvard’s Maya Jasanoff vists the Congo and discovers people there probably live harder lives than they did 100 years ago when Joseph Conrad was there
- Eric Foner says in an interview that it’s not necessary to remove Confederate statues
- Philip Zelikow says the government should crack down on armed groups of militants