Wednesday, Jan 30, 2008
In it for the long run?
BBC: King reappointed as Bank governor
Does this mean he will dig his heals in and do the "right" thing for the long term?
Posted by geed @ 09:49 AM (817 views) Add Comment
10 Comments
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1. geed said...
Yes I know "heels".
2. Geed said...
I had this to say a couple of days ago regarding our central bank leaders......
"
Back to the "panicky rate cuts ".
Bernanke will not want to be holding the financial reign when the US goes into recession. Therefore he will slash and keep slashing, Greenspan did it why can’t he?
Greenspan knew a credit bubble would emerge when rates were slashed in the US after 911, he needed the credit bubble to make him look good. Eddie George has admitted the housing bubble and credit bubble in the UK was engineered by him (& Blair/Brown). The majority were happy in their bank owned 5 bedroom houses and X5's.
Even though Greenspan and George are essentially the culprits that have created this mess, we look to Bernanke and King when talk of a slowdown/recession is mentioned and hold them responsible.
If Bernanke can steer around the looming recession in the US for the time being, his low IR’s will be a problem that he will pass on for future Fed chiefs to deal with in years to come, much I the same way Greenspan has done for Bernanke.
Just like politicians, self interest is the name of the game.
I believe King has just about renewed his contract, let’s hope he is in it for the long run then."
3. su said...
Geed. Freudian slip perhaps?
4. geed said...
Had this to say about our Central bank chiefs a few days ago....
"
Back to the "panicky rate cuts ".
Bernanke will not want to be holding the financial reign when the US goes into recession - or he wont want to be in a recession for long. Therefore he will slash and keep slashing, Greenspan did it why can’t he?
Greenspan knew a credit bubble would emerge when rates were slashed in the US after 911, he needed the credit bubble to make him look good. Eddie George has admitted the housing bubble and credit bubble in the UK was engineered by him (& Blair/Brown). The majority were happy in their bank owned 5 bedroom houses and X5's.
Even though Greenspan and George are essentially the culprits that have created this mess, we look to Bernanke and King when talk of a slowdown/recession is mentioned and the public will hold them responsible.
If Bernanke can steer around the looming recession in the US for the time being, his low IR’s will be a problem that he will pass on for future Fed chiefs to deal with in years to come, much I the same way Greenspan has done for Bernanke.
Just like politicians, self interest is the name of the game.
I believe King has just about renewed his contract, let’s hope he is in it for the long run then."
5. Stevie Dee said...
@geed. I must defend Greenspan on this, as I feel it was a little harsh. Greenspan did not create the housing malaise in the US, it was the financial criminals who off their own backs created an artificial market. Whereas over this side of the pond, yes, it could be said that the BTL market concept was created by the Conservative's and dished up by Labour Party.
6. Sacred Contracts said...
So he really is the King then...
7. Brightfox said...
Nevermind Mervyn King, Brown wants to get rid of that idiot Blanchflower who cannot see anything beyond his nose!
8. The Haunted said...
Heal was right the first time, Gordy says "Heal Mervin!", and Mervin does. What a lovely reward for such a well behaved pet.
9. paul said...
When you murder an individual, you face the death penalty, but if you murder 1000 people you spend a lifetime of relative luxury in the Hague.
This is no different - King's predecessor as you rightly say Geed, was the person who on his own admission created this mess. Now his successor takes no flak for the Bank's actions, and is not responsible. When house price inflation was at runaway levels fuelling risky business models, King was silent.
I am appalled that his contract has been renewed.
10. geed said...
I can't disagree with you Paul, my point was; will he now look 5 years ahead instead of 5 weeks. Lets slow things down, skim the scum off of the housing market and the financial sector for the next 3-4 years and lets get back to "sustainable" growth. He may then be remembered as a decent Governor - is there such a thing?
In Kings favour he did not vote for 2005 cut which got the air pump out again, saying that he didnt vote to increase IRs's either.