<p>The SAC is a direct fiscal stimulus.  The Fed is not allowed to do that- fiscal policy is controlled by Congress.  The Fed is only allowed to take monetary action, such as lowering rates or buying bonds (QE).</p>
<p>As to whether SAC is a good idea for fiscal policy depends on your political viewpoint.  It’s a highly progressive , broad distribution of money.  I can see all kinds of practical issues such as hoarding in case the policy goes away.  Overall it doesn’t sound too sensible.</p>

CC BY-SA 4.0
2023-09-19T09:53:29.940Z
Are you sure this is highly progressive when I can get a 50% subsidy for a bag of groceries but a billionaire gets 50% for a yacht?
H2ONaCl
CC BY-SA 4.0
2023-09-21T02:00:33.603Z
I didn’t know that.  Where can I get a yacht half price ?
dm63
CC BY-SA 4.0
2023-09-19T03:58:11.863Z
2023-09-19T03:58:11.863Z
dm63
<p>Direct fiscal stimuli in the form of deposit level increases is arguably an even better policy than SAC.  This way, you don't get a bigger discount the more you spend (i.e. the richest) and it's incredibly progressive and redistributes income to the lower end of of the distribution.</p>
<p>You're completely right that QE largely has the effect of creating asset price inflation as opposed to Consumer Price Inflation (CPI).  This primarily benefits the most well off with the most assets...  clearly regressive in nature.</p>
<p>The Government through Congress in the US or Parliaments in the UK or Canada, etc, are responsible for fiscal policy by institutional convention.</p>

CC BY-SA 4.0
2023-09-20T08:09:29.863Z
2023-09-20T08:09:29.863Z
Jamie Smith
<p>Instead of quantitative easing and interest rate reductions why wouldn’t Stimulus at Checkout (SAC) work?</p>
<p><strong>What is SAC?</strong> When the Fed needs to stimulate the economy, using Point of Sale technology, SAC pays for 50 percent of purchases made by consumers at checkout.</p>
<p><strong>SAC creates fewer dangerous unintended consequences</strong> than quantitative easing or interest rate tools.  Money tied to quantitative easing and interest rate reductions tends to leak into creating asset bubbles.  SAC creates demand not asset bubbles.</p>
<p><strong>Politically, SAC is an easier sell</strong> than traditional tools.  It’s popular with lower income households and business owners.</p>
<p>Here is a YouTube video which summarizes SAC:</p>
<p><a href="https://youtu.be/_YhIQqa00Is?si=U5oUEYpLhTvGJH3W" rel="nofollow noreferrer">https://youtu.be/_YhIQqa00Is?si=U5oUEYpLhTvGJH3W</a></p>
<p>Why wouldn't SAC be a better alternative to quantitative easing?</p>

<macroeconomics><monetary-policy><federal-reserve><quantitative-easing>
Instead of quantitative easing why wouldn’t Stimulus at Checkout (SAC) work?
GW1732
# Instead of quantitative easing why wouldn’t Stimulus at Checkout (SAC) work?

(Asked by: username_0 on 2023-09-05)

Instead of quantitative easing and interest rate reductions why wouldn’t Stimulus at Checkout (SAC) work?

**What is SAC?** When the Fed needs to stimulate the economy, using Point of Sale technology, SAC pays for 50 percent of purchases made by consumers at checkout.

**SAC creates fewer dangerous unintended consequences** than quantitative easing or interest rate tools. Money tied to quantitative easing and interest rate reductions tends to leak into creating asset bubbles. SAC creates demand not asset bubbles.

**Politically, SAC is an easier sell** than traditional tools. It’s popular with lower income households and business owners.

Here is a YouTube video which summarizes SAC:

<https://youtu.be/_YhIQqa00Is?si=U5oUEYpLhTvGJH3W>

Why wouldn't SAC be a better alternative to quantitative easing?

**Tags:** macroeconomics, monetary-policy, federal-reserve, quantitative-easing

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## 2 answers

### Answer by username_1 on 2023-09-19. Score: 1

The SAC is a direct fiscal stimulus. The Fed is not allowed to do that- fiscal policy is controlled by Congress. The Fed is only allowed to take monetary action, such as lowering rates or buying bonds (QE).

As to whether SAC is a good idea for fiscal policy depends on your political viewpoint. It’s a highly progressive , broad distribution of money. I can see all kinds of practical issues such as hoarding in case the policy goes away. Overall it doesn’t sound too sensible.

> **Comments:**
> **username_2**: Are you sure this is highly progressive when I can get a 50% subsidy for a bag of groceries but a billionaire gets 50% for a yacht?  
> **username_1**: I didn’t know that.  Where can I get a yacht half price ?  

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### Answer by username_3 on 2023-09-20. Score: -1

Direct fiscal stimuli in the form of deposit level increases is arguably an even better policy than SAC. This way, you don't get a bigger discount the more you spend (i.e. the richest) and it's incredibly progressive and redistributes income to the lower end of of the distribution.

You're completely right that QE largely has the effect of creating asset price inflation as opposed to Consumer Price Inflation (CPI). This primarily benefits the most well off with the most assets... clearly regressive in nature.

The Government through Congress in the US or Parliaments in the UK or Canada, etc, are responsible for fiscal policy by institutional convention.


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