part 6 johansen cointegration test (aka jc test) -even though the above eg test can determine if two variables are cointegrated (meaning there is a long-term stable relationship between two variables), regressing the variables in a different order gives different cointegrated vectors. to see how many variables are cointegrated, the jc test is used. -these standardized cointegrated tests confirmed that increasing federal debt was the greatest driver of inflation (cpi increases), not federal reserve asset purchases. -federal reserve asset purchases instead increased the deficit and the feds low interest rates were just to appease fed qe critics. the fed argued its zero rate monetary policy was to stimulate the economy, when only two years between 2010 and 2022 were negative economic growth
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