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Crowding-Out: The Fed May Be Killing the Private Sector to Save Government

Crowding-Out: The Fed May Be Killing the Private Sector to Save Government
The Marriner S. Eccles Federal Reserve building in Washington on April 10, 2023. Madalina Vasiliu/The Epoch Times
Daniel Lacalle
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Commentary

The Federal Reserve’s balance sheet reached its all-time high in May 2022. Since then, it was supposed to drop at a steady pace and shed $3 trillion by 2024. The normalization of monetary policy was built on the idea of a soft landing for the economy. However, the Fed may be killing the private sector to save the government.

Daniel Lacalle
Daniel Lacalle
Author
Daniel Lacalle, Ph.D., is chief economist at hedge fund Tressis and author of the bestselling books “Freedom or Equality” (2020), “Escape from the Central Bank Trap” (2017), “The Energy World Is Flat”​ (2015), and “Life in the Financial Markets.”
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