Model-based estimates of the natural rate of interest, or r-star, and related variables| www.newyorkfed.org
There is a great deal of euro-bashing circulating these days. The central argument is that Europe has been lagging the US economically, with an equally bleak outlook for the future. However, one often-overlooked factor is the significant role of massive borrowing—expansionary fiscal policy—in driving stronger US growth. When this is accounted for, the US’s apparent economic outperformance becomes less impressive.| Rangvid’s Blog