From one piece Better Debt 3 beliefs · grumpy-economist.com
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Simplifying a bit, the Treasury should introduce a fixed-coupon perpetuity and a fixed-value floating-rate perpetuity. These should gradually make up the bulk of government debt.
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In QE, the Treasury issued long-term bonds. The Fed bought up the long bonds, issued overnight debt, and passed the interest difference back to the Treasury. In the end, it is just as if the Treasury issued overnight debt in the first place.
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The tradeoff between cost of borrowing and how much interest rate risk taxpayers shoulder should be squarely on the shoulders of the politically-accountable Treasury not the independent Fed.