Financial Markets

Bernie Sanders wants a tax on financial transactions so that every trade brings a penalty. While this most directly affects big traders, regular people will not be immune to the effects.

By announcing that it is willing to throw up to $1.5 trillion in electronically created money in order to give three-month loans to those institutions that bought Treasury debt earlier, the Fed is bailing out not only the holders of Treasury debt, but also the Treasury itself.

Although consensus building surely is an important and noble pursuit, one would think that it wouldn't really fall within the purview of a central bank president. It’s been clear for a long time that allowing politics to influence monetary policy carries significant and numerous risks.

There are echoes of the 1973 oil shock in the current virus scare and resulting economic seize-up. Central banks are likely to respond similarly: with "stimulus" and inflation.