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After the great financial crisis, the "New Normal" became a fixture in the capital markets financial lexicon. Use of that phrase has slowly faded, though it could easily be resurrected in a modified form - the "New FED". One might say that the "New FED" is all about easy monetary conditions all the time, despite what inflation, unemployment or GDP might be indicating. The "New FED" is on board with Modern Monetary Theory (MMT) and its mantra of printing money and issuing debt with few or no constraints. As evidence, look at the near trillion-dollar U.S. spending deficit that is now a fixture of the U.S. economy, the $3.8 trillion-dollar Federal Reserve balance sheet, and the desire to cut interest rates to support these. A call for easier monetary policy despite ultra-low unemployment, wage growth, inflation trending higher, record financial asset prices, and a reasonably strong economy, is puzzling. Does anything say "advocate of MMT" more than suppressing the cost of debt, obfuscating price discovery and telegraphing even more interference in the capital markets when there doesn't seem to be a need? Weren't all the extraordinary measures taken by the Federal Reserve these past 10 years supposed to make the financial markets more resilient, not more fragile?
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