The proposed legislation «will require balanced budgets
during normal economic times, and concrete timelines for returning to balance in the event of an economic crisis,» according to the throne speech.
It will require balanced budgets
during normal economic times, and concrete timelines for returning to balance in the event of an economic crisis.
That is, will the legislation require that surpluses be realized
during normal economic times to offset the run up in federal debt during the economic crisis or that only balanced budgets are required?
At that time, the Government indicated that the proposed legislation «would require balanced budgets in
normal economic times and concrete timelines in returning to balance in the event of an economic crisis».
Most importantly, what constitutes «
normal economic times»?
This is a good way to frame the problem during
normal economic times; if you don't go out and look, you're not going to land a job no matter how many are out there.
In
normal economic times, spreads between longer - dated maturities and shorter - dated maturities should be positive, representing a combination of positive growth expectations, positive inflation expectations and, in general, an indication of stable or improving economic conditions.
In
normal economic times, interest rate announcements are very volatile news announcements, but over the last few years there is basically no movement around those releases in the United States since everyone knows the Fed is now raising interest rates until well into 2012.