Skip to comments.BIS Official Warns of Central-Bank Overreach
Posted on 06/27/2012 2:40:52 AM PDT by TigerLikesRooster
June 24, 2012, 11:30 AM ET
BIS Official Warns of Central-Bank Overreach
Jaime Caruana, general manager of the Bank for International Settlements and former governor of the Bank of Spain, warned Sunday that the recent aggressiveness of the worlds central banks may be creating unrealistic expectations about their power to resolve the fundamental problems that hold back sustainable growth and argued that more central bank action poses unwelcome risks.
Monetary policy can buy time needed for other policies to correct fundamental balance sheet problems, he said, according to the prepared text of remarks to be delivered in Basel, Switzerland, at the annual general meeting of the BIS, a consortium of the worlds central banks. But even in this transitory role, monetary policy is not without limits or risks. Under current circumstances, the benefits of continued monetary easing cannot be taken for granted.
Mr. Caruanas comments come as the central bankers from Beijing to Frankfurt to Washington are under renewed pressure to step up efforts to resuscitate the slowing global economy. Some economists and politiciansand some central bankers in the U.S. and the U.K.argue that the central banks are too hesitant, condemning their economies to slower growth and higher unemployment than necessary in the wake of the devastating financial crisis.
(Excerpt) Read more at blogs.wsj.com ...
resolve the fundamental problems that hold back sustainable growth
Speaks for itself