Lars Svensson is understandably ‘furious’ with his former colleagues at the Riksbank

I´m at the airport ready to board for the US to attend my daughter´s wedding. But couldn´t avoid pointing to Svensson´s ‘ire’ towards the sort of monetary policy being practiced by the Riksbank.

Svensson concludes his rant:

The Riksbank has neglected the price-stability objective by allowing average inflation to undershoot the inflation target. This has led to higher average unemployment. The Riksbank has thereby not supported the objective of the general economic policy of high employment. Lower average inflation has also led to higher real household debt, and to a higher debt ratio relative to GDP and disposable income. All this in spite of the Riksbank justifying its tight policy by the presumption that the policy would lead to a lower debt ratio than an easier policy would.

All in all, the Riksbank is apparently not only neglecting the price-stability objective; it is actually both counteracting the high-employment objective of the Riksdag and the Government as well as increasing household indebtedness.

And at one point Sweden was doing so well,,,until it veered off path!

Svensson Rant

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7 thoughts on “Lars Svensson is understandably ‘furious’ with his former colleagues at the Riksbank

  1. What is wrong with central bankers today? They have a squeamish aversion to prosperity, and a peevish fixation on inflation.

    Should the day of independent central bankers be over?

    If not, how long will this tyranny of tightness persist?

  2. Pingback: TheMoneyIllusion » Conservatives are their own worst enemy

  3. I´m at the airport ready to board for the US to attend my daughter´s wedding.

    Oh my goodness!

    Congratulations!

    Very exciting!

    Marcus – I owe you a WAY belated thank-you for your graph —– am just emerging from another avalanche of overcommitments—–

    (When and where??!)

    Catherine J

  4. Pingback: いつも自滅する保守派 — 経済学101

  5. I am collecting different ways of explaining hyperinflation. I have 14 different ways at the moment. I have not found a Market Monetarism explanation of the mechanics of hyperinflation. How does it start, why does it keep going on, that kind of thing. Look at my other 14 cases if it is not clear what I am after. Can you point me at a Market Monetarism explanation or can you write up one for me? Here is my collection:

    http://howfiatdies.blogspot.com/2013/09/hyperinflation-explained-in-many.html

    Thanks.

  6. Pingback: Novac i krediti pt.3 - Švedski slučaj - monetarist.net

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