Prof. Jayanth R. Varma's Financial Markets Blog

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Prof. Jayanth R. Varma's Financial Markets Blog, A Blog on Financial Markets and Their Regulation

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Mon, 25 Aug 2008

Buiter on the central banks

Willem Buiter’s paper at the Jackson Hole Symposium castigating the major central banks of the world (and the Federal Reserve in particular) is worth reading in full (144 pages) even if one disagrees with what he has to say. I am surprised that as of today, I still cannot find the symposium papers at the web site of the Kansas Fed which organized the symposium, but the paper is available in the public section of the website of the Wall Street Journal.

Some people have been mis-characterizing the paper as dogmatically opposing central bank interventions on moral hazard grounds. That is not the impression that I got by reading the paper. The paper does accept that the central bank has to intervene in times of crises, but Buiter does oppose the particular forms that this intervention has taken.

Below are some interesting quotes from the paper:

Posted at 16:00 on Mon, 25 Aug 2008     0 comments     permanent link