Fed Chair Powell Says Concept of MMT Is 'Just Wrong'

The video discusses Modern Monetary Theory (MMT), which advocates for using large deficits to fund policies like Medicare for All and free college. It suggests the Federal Reserve should keep interest rates low while Congress manages fiscal policy. The speaker critiques MMT, arguing that deficits do matter and that US debt is growing too fast. The role of central banks is emphasized as achieving employment and price stability, not supporting specific policies.

What is one of the key proposals advocated by supporters of Modern Monetary Theory?

• Reducing government spending

• Increasing interest rates

• Implementing universal basic income

• Privatizing healthcare

What is a major criticism of the idea that deficits don't matter for countries borrowing in their own currency?

• It causes unemployment

• It ignores the growing national debt

• It leads to increased foreign debt

• It results in higher taxes

According to the transcript, what is the current state of US debt in relation to GDP?

• It is decreasing

• It is stable

• It is growing faster than GDP

• It is not a concern

What is the primary role of the Federal Reserve as mentioned in the transcript?

• To control government spending

• To support specific government policies

• To achieve maximum employment and stable prices

• To manage fiscal policy

Who is responsible for decisions about spending and controlling spending according to the transcript?

• The President

• Congress

• The Treasury Department

• The Federal Reserve