Ambrose Evans-Pritchard circulates the joke:
Mr Draghi said the ECB is studying what happened in Japan at the onset of its Lost Decade in the 1990s, insisting that Europe is unlikely to go the same way into deflation given the more aggressive measures to clean up the banking system and the stronger balance sheets of companies. He said the ECB had acted much earlier than the Bank of Japan.
You wouldn´t guess that´s what the ECB did from eyeballing the charts below. Seems the EZ is doing even worse than Japan in the relevant time frame!
BOJ raised the rate in 1998 under the new law
Yeah, but that´s outside the “time frame”. But the ECB, when they raised rates twice in April/June 2011 the Japanese rate “experiment” was known. So they didn´t “learn”!
What is it with central bankers?
Really, public policy makers have to seriously question the ideal of “independent” central banks.
Is this really better than bank officials who know they might get voted out of office?
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The Republican congress wants tighter money. And the Democrats, given a choice between looser money, and massively jacking up the minimum wage, would choose the latter.
I hope removing central bank independence never becomes a major tenet of Market Monetarism.