Monetary policy

Business Spectator

Time for a rethink on monetary policy

16/01/2014
For the past forty-odd years, since the US’ final departure from the Bretton Woods system and the last remnants of the link between the US dollar and gold, we have indulged in the idea that the old definition of money no longer mattered. We thought we could just declare what ought to count as money. The signs that this system of monetary ruthlessness and lawlessness has run its course are overwhelming. A world that cannot bear the thought of a return to normal is a case in point.

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Business Spectator

Silent assassins chase German savers

21/11/2013
It is the tragedy of monetary union that it has pitted whole countries, their economies and their peoples against each other. What should have been a win-win situation has become a zero sum game. The periphery cannot win if Germany does not lose out and vice versa.

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Business Spectator

Rates of wrath: Why the EU needs real reform

14/11/2013
It is a strange world. Even the most ardent defenders of the European Central Bank’s interest rate cut last week do not claim it will have any effect. All they say is that it underlines ECB President Mario Draghi’s commitment to save the euro “whatever it takes”. It was a psychological signal to markets rather than a meaningful change of policy, so they argue.

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Uncategorised

Was lehrt uns Japans lange Krise?

24/06/2013
Die Wirtschaftsgeschichte lehrt, dass für eine solche Politik des billigen Geldes langfristig stets ein hoher Preis zu zahlen ist. Zu den Schulden, dem hohem Alter der Japaner und der Dauer-Depression dürfte sich eine Währungskrise hinzugesellen. Das Land der aufgehenden Sonne geht seinem Untergang entgegen.

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Insights

What if there’s no exit?

07/06/2013
The global economy may appear to have calmed somewhat since those stormy days when Lehman Brothers collapsed in late 2008. But it’s just the calm before an even fiercer storm.

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Business Spectator

The currency union that’d drag Australia south

30/05/2013
If you really can’t help yourself and desperately yearn for a currency union between Australia and New Zealand against all odds, then at least you should also include Papua New Guinea. Simply because every failing monetary union deserves its Greece.

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Insights

Stick with inflation targeting

28/03/2013
Manufacturers and exporters have been complaining about the high Kiwi dollar for a long time. Opposition politicians are openly toying with the idea of changing the Reserve Bank’s mandate to manipulate the exchange rate downwards. The question is, if inflation targeting was abandoned in favour of managing the exchange rate, would it actually work?

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National Business Review

Stop whingeing – and get back to work

22/02/2013
Comparing Germany’s historical experience with New Zealand’s current dollar discussion, a few things become clear. A rising exchange rate certainly poses a challenge to exporters and manufacturers. But that does not mean that they will go out of business.

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