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17 Responses to “Central Bank Appoints New Chief Economist”
“Once the liquidity terror subsides, the heavy lifting of energy conservation and currency reform can begin.
This will put the European money establishment in an uncomfortable situation. For two years the ECB and the Euro- establishment has been sneering at the Yanks for their Bernanke Blunders and the circus- like Bernake Ponzi Money Laundry. The ECB now has to ‘do the Bernanke’ and reflate its paupers’ finance sectors! Not only that, regardless of what they do, the result will be the trashing of the euro. The Eurozone isn’t like America with its idle, TV- saturated masses who will grumble and do without. Money has to get into the hands of European citizens of there will be serious trouble in the streets!
Since the euro is not (really) a reserve currency there is no flight to quality toward the euro in this crisis. A Greek collapse destroys the euro with deflation as is happening now. An bailout leads to much higher energy prices – energy inflation as more euros pursue either less fuel or scarce dollars. The high energy prices are also deflationary. The cycle will push the dollar higher and oil priced in dollars lower, putting even more downward pressure on the euro.
On the other hand , the lower euro would theoretically support increased commerce … or would it? Not really because what the Eurozone exports is more and more energy consumption! This is what the rest of the world does not need.
The outcome is that Europe will be flooded with cheap euros leading to skyrocketing euro fuel costs. The Eurozone will have to buy dollars in order to be able to afford crude. Keep in mind, the reason for the Euro in the first place was to give European nations a means to import fuels without having to buy dollars first. So much for that idea …”
“The euro becomes ironic: too hard within Europe itself but always second fiddle to the dollar for the Middle Eastern energy producers will always prefer the dollar as it represents ‘security’”
Dork – How is this banker dude going to handle this situation if indeed he has a few altrustic bones in his body ?
Just walked past a school run in a working class neighbourhood with cars and engines idling everywhere.
We have not enough money to pay debt obligations which kills internal commercial activity but enough money for German & Saudi Imports……
We have clearly a non optimum currency.
The Euro policey has turned the $ into a hard rather then soft Petro currency.
The record prices in Euro Crude will collapse the economy again just as night follows day – strengthening the $ which is peverse as the Americans waste far more Fuel then Europe.
The Euro is doing directly the opposite of what it says on the tin – its a very junior currency which confers no advantages to its users.
I’m torn between feeling that it’s great to have such a well qualified and well networked guy in the role, and feeling that it moves the Irish Central Bank closer to being a wholly owned and controlled subsidiary of the ECB.
I guess it was already obvious that the ICB would have to be severed from the decision loop if the Government ever developed the gumption to take an independent economic line.
It’s obvious that we need international talent, but maybe someone from the Fed, the Reserve Bank of Australia or the Bank of Canada next time?
“I’d love to see the rest of the public service reaching out and nabbing such international talent.”
A) staff embargo doesn’t apply there
B) central bank able to pay international salaries.
C) central bank has a decent working enviroent
Desmond boy – you should know there is no such thing as nationality amongest the CB set.
You are either one of them magicians or one of those timid Little Lions.
Can’t imagine those lads recommending we issue Peat backed exchequer certificates in the interests of competition like.
But Maybe interest free notes as long as we pretend (Hush hush) they are not & run it through the CB system, just for optics like.
(i) What is the cumulative total of crystallised and/or estimated Irish banking losses since 2007, including non-covered UK Banks, DEPFA/Hypo, NAMA? and
(ii) the latest running total cost to Irish UK and German (and Rest of Europe) taxpayers of “socialisation” of those losses?
Are we talking at least €300bn?
Todays’s reporting on RBS/Lloyds results make Ireland look like the vicious wee death star of global finance. Small but deadly. Hope Mr Cardiff’s Court of Auditors immunity kicks in soon or he may have his collar felt going via Heathrow!
Looks promising, Stockholm Illinois and Paris.
I hope he has an air tight employment contract. As the economic and political climate worsens the politicians will be casting around for scapegoats. Life is likely to get unpleasant for people working for the Central Bank.
I wish Lars Frisell every success in his new job..
An asset/property has two values, the price you can get for it,or the net present value of it’s future cash flows. If somebody auctioneed a 5 euro note on Grafton Street and an unwise person bidded it up to 20 euro, then a surveyor would value all 5 euro notes as 20 euro notes. Now we know the net present value of a 5 euro note is 5 euro. Likewise if an unwise person paid 2 million euro for a house whose net present value was 0.5 million euro ,then a surveyor would value all other similar houses in that housing estate at 2 million euro.
The commercial property market was similar. If an unwise tenant on Grafton Street paid a world record rent for a shop, then all the other shops on the street would be obliged to pay this rent, and surveyors would value all shops on Grafton Street accordingly.
Almost all of the Irish banks reckless lending was done using surveyors/auctioneers valuations. These valuations were as good as money. This is the valuation error than created the property bubble and bankrupted the country.
M.Sc. Economics London School of Economics and Political Science.