Should the US Fed be easing policy after the Brexit vote?

The Fed obviously was unprepared for the outcome. US President Barack Obama, Bill Clinton and Fed Chairman Janet Yellen had all weighed in on the ‘Remain’ side.

Some US Presidential contenders realize the full extent that much of our citizenry feels left behind. The solutions proposed by candidates may be pipedreams, but one clearly can be applied across the developed world. Infrastructure is falling apart. It needs repair. Good jobs can be created for the disaffected.

In the meanwhile, stop gap measures might be applied by the central bank.

Should Yellen start explaining negative interest rates? In part this depends on who needs help? Is it her job to stabilize markets? Unfortunately during the sub-prime mortgage crisis which began in 2008, only needs of outsized banks, the markets and the very wealthy were addressed.

In the US, both Democrats and Republicans know that we have to repair our bridges and highways. An infrastructure bill passed our legislature this spring in which the US Fed, in a highly unusual move , provided financing.

We have written, over and over, that the idea that central banks should be the prime movers in shaping the economy is undemocratic and an inappropriate aggrandizement of their role.

They have stepped in where others fear to tred. But now is not too soon to start looking elsewhere for overall guidance of the economies of developed countries. Other Brexit’s will happen if we don’t.