Germany attacks central bank policy

Economic growth, Financial Events, Leverage

Merkel.jpg

During the growth years, it became fashionable for politicians to claim that central banks were “independent”. But as the current crisis has grown, this has been increasingly exposed as a myth.

As the blog noted back in September 2007, Alan Greenspan (former US Federal Reserve Chairman), revealed that ‘the presumption that we were fully independent and have full discretion was false’.

Now Germany’s Chancellor, Angela Merkel, has gone one step further. Speaking in Berlin, she made a remarkable attack on current central bank policies. “What other central banks have been doing must be reversed. I am very sceptical about the extent of the Fed’s actions and the way the Bank of England has carved its own little line in Europe. Even the European Central Bank (ECB) has somewhat bowed to international pressure with its purchase of covered bonds.”

In other words, the ECB should do what the politicians tell it to do, not what it thinks is the right policy. The blog will watch to see if it now begins to retreat on recent initiatives, even at the cost of breaking central bank unity as the current crisis deepens.

PREVIOUS POST

Difficult decisions loom on future US auto demand

03/06/2009

By the end of May last year, 6.2m autos had been sold in the US market, each con...

Learn more
NEXT POST

V-shaped sellers meet L-shaped buyers

07/06/2009

Picture: www.businessoffashion.com A senior figure in the investment community t...

Learn more
More posts
Merkel warns of need to prepare for No Deal Brexit
05/07/2020

Most people missed the fact that last Tuesday was the last possible date to delay the UK’s exi...

Read
Economic risks rise as the lockdowns end
14/06/2020

It is now 13 years since I wrote the first post here, in June 2007. A lot has happened since then: ...

Read
World moves from Denial to Anger, as the Paradigm of Loss moves forward
07/06/2020

I have been warning about the Covid-19 risk since early February, and in April suggested here that: ...

Read
The New Normal for global industry
31/05/2020

The global chemical industry is the third largest sector in the world behind agriculture and energy,...

Read
Debt, deflation, demographics and Brexit set to challenge London house prices
17/05/2020

London property websites haven’t used the word “reduced” for many years. But it...

Read
The bill for two decades of doomed stimulus measures is due
03/05/2020

The Financial Times kindly made my letter on the risks now associated with central bank stimulus the...

Read
Local supply chains replace global trade as world starts to “do more with less”
26/04/2020

Something quite dramatic is happening in the global economy.  Of course, Wall Street analysts still...

Read
Financial markets enter their Convulsion phase
19/04/2020

Many companies and investors are still comparing today’s downturn to the 9-month hiccups seen afte...

Read

Market Intelligence

ICIS provides market intelligence that help businesses in the energy, petrochemical and fertilizer industries.

Learn more

Analytics

Across the globe, ICIS consultants provide detailed analysis and forecasting for the petrochemical, energy and fertilizer markets.

Learn more

Specialist Services

Find out more about how our specialist consulting services, events, conferences and training courses can help your teams.

Learn more

ICIS Insight

From our news service to our thought-leadership content, ICIS experts bring you the latest news and insight, when you need it.

Learn more
X

Uncover exclusive industry upates from ICIS

Interested to uncover more articles related to this topic? Explore additional news, insights and intelligence, tailored to the markets you are interested in by accessing exclusive content from ICIS.com

DISCOVER MORE