BRIAN KANTOR: No fiscal crisis on the horizon for the US — unless interest rates rise
Fed chair Jerome Powell is confident that average price rises are well anchored around the 2% rate
The US not only has old-fashioned cheques, but cheques in the post nogal. No less than 90-million cheques of $1,400 each to Americans earning less than $400,000 have been mailed so far, with many more to come as more envelopes are filled.
The dollars will find their way out of the Federal Reserve banks into individual banking accounts, which will add to bank deposits and the cash reserves of the banks with the Fed. These reserves have increased enormously and will rise further. Deposits with US banks are up by 26% since January 2020 and the cash reserves of US banks are up 92%. Both represent huge firepower for additional spending on goods and services and for bank lending over the next year...