The central banks are considering alternatives to borrowing and bonds but giving money through incentives and tax breaks. This article discusses "Helicopter money", which is printing money to fund government spending or to give people cash, this is in response to nations chronically low inflation and interest rates especially in Japan and Europe. The goal would be to increase government spending, tax cuts or pay citizens directly, governments have tried quantitative easing where governments would hold onto bonds until maturity. The downfall is that citizens may choose to save their money rather than spend it, thus not helping the economy at all. The ECB has been slow to recover especially because they are not able to finance governments. Countries are struggling with lowering their deficits. This article speculates that if countries don't have the framework to use helicopter money, then they will not be able to react as efficiently to the next financial crisis.
THE ARTICLE
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