In a normal recession, the focus is on using fiscal stimulus to make up for a drop in aggregate demand. A "pandemic" recession is a much different animal.
Good article with estimates: 1) I would say most recessions involve monetary stimulus over fiscal because Milton Friedman changed the way governments thing with his Nobel Prize "theory of the consumption function" that people will typically not spend money related to one-time events such as being hired to build a dam. 2) Therefore, monetary authorities typically expand the money supply by buying bonds. This is to ensure banks have sufficient liquidity to fund new loans if needed hence a more elastic currency.
Finally, I don't agree with the idea of handouts. That is not sustainable for very long, because money has value based on GDP, and the problem with your thinking is you're thinking money is the real and good/services are the abstract--it is the opposite. GDP is based on goods/services not money. Money is the abstract. Meaning if people aren't doing goods/services than GDP shrinks regardless of what the money is. Finally, at some point the 80% employed will wonder why they are doing so much work when the 20% , now unemployed, get all the same benefits. Hence massive inflation if we don't solve this issue soon
Good article with estimates: 1) I would say most recessions involve monetary stimulus over fiscal because Milton Friedman changed the way governments thing with his Nobel Prize "theory of the consumption function" that people will typically not spend money related to one-time events such as being hired to build a dam. 2) Therefore, monetary authorities typically expand the money supply by buying bonds. This is to ensure banks have sufficient liquidity to fund new loans if needed hence a more elastic currency.
Finally, I don't agree with the idea of handouts. That is not sustainable for very long, because money has value based on GDP, and the problem with your thinking is you're thinking money is the real and good/services are the abstract--it is the opposite. GDP is based on goods/services not money. Money is the abstract. Meaning if people aren't doing goods/services than GDP shrinks regardless of what the money is. Finally, at some point the 80% employed will wonder why they are doing so much work when the 20% , now unemployed, get all the same benefits. Hence massive inflation if we don't solve this issue soon