Narayana Kocherlakota, Columnist

What the Fed Can Do to Speed the Recovery

Put a cap on long-term interest rates.

June 4, 2020 at 11:00 AM UTC

Narayana Kocherlakota is a Bloomberg Opinion columnist. He is a professor of economics at the University of Rochester and was president of the Federal Reserve Bank of Minneapolis from 2009 to 2015.

Won’t go negative.
Photographer: Andrew Harrer/Bloomberg

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The U.S. Federal Reserve needs to find a way to boost the economy and get people back to work. But it doesn’t want to lower interest rates below zero, as I have recommended. So what can it do?

One option: bring down longer-term interest rates by putting a cap on the yields of government bonds.