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Charts of the day, policy divergence edition

That’s chart 1.13.3 from the IMF’s Global Financial Stability report. Mind the y-axes.The chart reinforces one bit of conventional wisdom, which is that US policymakers responded more aggressively than their counterparts in the euro area and Japan to the onset of the financial crisis.Fiscal policy looks to have loosened more in America when compared to its recent past, although the scale makes it difficult to compare policies across countries given the different sizes of the economies involved. In monetary policy the trend is less ambiguous: the Fed moved first and moved fastest, although it has since retreated.All true enough, though the US could have been more aggressive still, and furthermore could have allowed the looser policy to continue for longer. The agonisingly slow decline in

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Cardiff Garcia
Cardiff writes mostly about US macroeconomic issues, with daily excursions into other topics about which he claim no expertise. Before Alphaville, Cardiff spent a little more than two years as a reporter at Dow Jones Financial News covering investment banking, asset management, and private equity. Along the way he has written freelance pieces on a variety of other topics from behavioural psychology to Muay Thai, the latter also being a personal interest that involves frequently getting kicked in the shins (and torso, and head).

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