Tag Archives: International Monetary System
The “G20/IMF Communique”
Nearly six years after the outbreak of the worst financial crisis in history, prospects for a full economic recovery remain elusive. Unemployment remains at very high levels, and standards of living for many people in developed countries are likely to fall over the first two decades of this century. Meanwhile, emerging markets remain vulnerable…
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Thatcher, Volcker, Keynes and the power of ideas
The death of Margaret Thatcher reminds us all of the power of ideas, when allied to guts and leadership, to change the world. She identified one area of national life after another where restrictions and old ways of doing things were holding back innovation and the spirit of enterprise that lay dormant in the British…
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Might the US champion reform?
A few years ago, there was much excitement amongst monetary reformers when the governor of the People’s Bank of China made a speech championing reform. But China did not follow up that initiative – indeed, officials downplayed it, saying that Governor Zhou had been speaking in a personal capacity. Then came President Nikolas Sarkozy, who…
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Iceland, not Ireland, is the model for Cyprus
Ex ECB board member Lorenzo Bini-Smaghi has a piece in tomorrow’s FT where he says Ireland is the model that Cyprus should follow. Really? To be sure, Ireland has done well. But there is a better example – from outside the eurozone. It’s Iceland, not Ireland, that has pioneered the way for small…
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The dollar crash risk
As Jacob (“Jack”) Lew, the ex Citibank man who has succeeded Tim Geithner as US Treasury Secretary, surveys his inheritance, one thing he will probably not be worrying about is the dollar. Perhaps he should. True, prospects for the US currency have brightened recently. This reflects the new spring in the step of the American…
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Bank of Japan enters the money trap
The first thing to say about Haruhiko Kuroda, nominated as the next governor of the Bank of Japan, is that he is a very nice man. Whenever I have met him, he has been not only modest and friendly, but also ready, willing and able to discuss policy issues and ready to modify his opinion…
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Why Asia did not cause the financial crises
New attempts are being made to resuscitate the “savings glut” hypothesis of the origins of the great financial collapse and recession and the eurozone’s agony. This hypothesis is wrong. What matters is not saving but financing. Countries running current account surpluses do not finance those running current account deficits.The deficits are financed…
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Christine Lagarde gets it wrong
“The financial system can work if each of its members follow the right principles for their economy” M Lagarde has had a successful year at the Fund but this statement at the G20 meeting in Moscow yesterday shows the Fund has not learnt the key lesson of the economic disaster. The mistaken…
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The G30 plays blind man’s bluff
Watching governments, central bankers and economists explore the remaining ruins of the old pre-2007 economic structure is like watching children playing a game of blind man’s bluff. Being blindfolded, they cannot see what is around them, and are compelled to rely on their other senses. Much amusement is to be had for the onlookers,…
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The turning point for gold – now what?
Following my last post on gold, I got several comments: for and against. One said that the real reason gold has come back over the past 10 years is that central banks have stopped selling and started buying again. Indeed! Net gold purchases by central banks in 2012 were 534 tonnes –…
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