Ben Bernanke says the Fed shouldn’t rule out using negative interest rates

CNBC/Jeff Cox/1-10-2020

“In a blog post released over the weekend, Bernanke cited the benefits of at least keeping the option alive to take short-term rates below zero. Doing so, he said, would give the Fed flexibility at a time when its policy toolkit is limited.”

USAGOLD note:  As such, Bernanke agrees with Greenspan that below-zero interest rates are possible in the United States. Ex-Treasury Secretary Larry Summers (see link below) calls Bernanke’s speech “the last hurrah for central bankers” and supports instead a fiscal spending program to “put money in peoples’ pockets” through direct government spending.”  Isn’t that the equivalent of Bernanke’s helicopter money?  It would be difficult to envision Bernanke arguing against Summers’ proposal. Both occupy prominent positions on the Easy Money team’s roster.

Related: Summers calls Bernanke speech ‘last hurrah’ for central bankers/Bloomberg/1-9-2020