Citi Economist Mann: It Would Be 'Unfortunate' If Fed Moved to QE

The video discusses the process of monetary policy normalization and the large issuance of US Treasurys, highlighting the need for liquidity and the consequences of tight systems. It reviews research on banks' balance sheet elasticity and the repo market's size compared to the treasury market. The potential return to quantitative easing is considered, emphasizing the need for reasonable risk pricing and the Fed's role in navigating turbulent markets.

What are the implications of the current monetary policy normalization process?

What role does liquidity play in the current banking environment?

How has the balance sheet elasticity of banks changed since 2007?

What challenges does the Fed face in moving towards a more reasonable pricing of risk?

Discuss the potential consequences of low interest rates on the real economy.