Cloudy with a Chance of RIBs, Part 1

Quick Take2020 has been a year of perpetual overcast, many thanks to the economic havoc caused by Covid-19. Fiscal and monetary responses by the United States Department of the Treasury and the Federal Reserve have been swift and deep. Part 1 of this column reviews some of their actions. With once unconventional policies now the new normal, how will officials respond to further distress in the future?This column sets the stage for Part 2, where we will examine a recent Peterson Institute for International Economics (PIIE) proposal for recession insurance bonds (RIBs) and a Federal Reserve–backed digital currency.