The shift from a world in which central bank independence was founded on not buying government debt to one in which central banks around the world warehoused trillions of dollars in debt was bewildering. And it was all the more so because it happened tacitly, without frank acknowledgment of the transformation. As Paul McCulley, the former chief economist at the giant bond house PIMCO, put it, “We’ve had a merger of monetary and fiscal policy. We’ve broken down the church-and-state separation between the two . . . We haven’t had a declaration to that effect. But it would be surprising if you
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