Fed ‘stimulus’ chokes indirect finance to SMEs

Ronald Mckinnon

The US recovery from the subprime mortgage crisis of 2008 may seem stronger than that seen in other major economies. But given near-zero interest rates, it lacks lustre. Pundits are particularly concerned with the depressed level of employment.

Eschewing traditional monetary targets, the Federal Reserve has vowed to keep short-term interest rates near zero until the unemployment rate, currently at 7.8%, falls to less than 6.5% of the labour force. A laudable goal politically, no doubt; but the

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