The $2 trillion stimulus plan signed by the president likely won’t be adequate to save the US economy from collapse, according to Rochester economics professor Narayana Kocherlakota, a former president of the Federal Reserve Bank of Minneapolis.
“I think the package has been written with the idea that we’re going to be largely out of the woods by the end of June,” Kocherlakota says. “My own forecast of the economy is less optimistic. Congress will have to come back to do more. We will have to go higher than 2 trillion.”
Kocherlakota, the Lionel W. McKenzie Professor of Economics at Rochester, says that while many pundits and policymakers are making comparisons to 2008, the last time the economy fell into a deep recession, the situation brought on by the coronavirus pandemic face is fundamentally different from that of 2008 and requires different responses.