Sunday, August 28, 2016

Global central bankers, stuck at zero, unite in plea for help from governments


A picture illustration of crumpled kuna, Dollar and euro banknotes, taken in Zagreb January 18, 2011. REUTERS/Nikola Solic
By Howard Schneider

JACKSON HOLE, Wyo. (Reuters) - Central bankers in charge of the vast bulk of the world's economy delved deep into the weeds of money markets and interest rates over a three-day conference here, and emerged with a common plea to their colleagues in the rest of government: please help.

Mired in a world of low growth, low inflation and low interest rates, officials from the Federal Reserve, Bank of Japan and the European Central Bank said their efforts to bolster the economy through monetary policy may falter unless elected leaders stepped forward with bold measures. These would range from immigration reform in Japan to structural changes to boost productivity and growth in the U.S. and Europe.

Without that, they said, it would be hard to convince markets and households that things will get better, and encourage the shift in mood many economists feel are needed to improve economic performance worldwide. During a Saturday session at the symposium, such a slump in expectations about inflation and about other aspects of the economy was cited as a central problem complicating central banks' efforts to reach inflation targets and dimming prospects in Japan and Europe.

ECB executive board member Benoit Coeure said the bank was working hard to prevent public expectations about inflation from becoming entrenched "on either side" - neither too high nor too low. But the slow pace of economic reform among European governments, he said, was damaging the effort.
"What we have seen since 2007 is half-baked and half-hearted structural reforms. That does not help supporting inflation expectations. That has helped entertain disinflationary expectations,” Coeure said.

Bank of Japan governor Haruhiko Kuroda said he is in regular talks with Japanese Prime Minister Shinzo Abe about opening Japan to more immigration and other politically sensitive changes needed to improve potential growth, currently estimated at only around one percent annually.

Fed Chair Janet Yellen devoted the final page of her keynote talk on possible monetary policy reforms to a list of fiscal and structural policies she feels would help the economy.

Fiscal policy was not on the formal agenda for the conference, but it was a steady part of the dialogue as policymakers thought through policies for a post-crisis world. One of the central worries is that households and businesses have become so cautious and set in their outlooks - expecting little growth and little inflation - that they do not respond in expected ways to the efforts central banks have made.

That has included flooding the financial system with cash, and voicing a steady commitment to their inflation targets in an effort to make people believe they will be met.

Kuroda acknowledged that household expectations have not moved, and said the BOJ was prepared to continue its battle to figure out how to shift them. In modern monetary theory, households and business expectations are felt to play a defining role in spending and investment decisions, and thus in shaping inflation and growth.

"Japanese inflation dynamics remain vulnerable," Kuroda said. "It could be that long-term inflation expectations are yet to be anchored in Japan" at the bank's 2 percent target.

The concern about expectations is a paradox. The Fed for example fought a difficult battle with inflation in the 1970s, hiking interest rates to recession-provoking levels and eventually winning a war of credibility over its ability to rein in price increases.

Some central bankers remain fearful of clipping that cord.
But they also are hunting for ways to jolt the economy out of its doldrums, and a fiscal push is a possible tool.

In a lunch address by Princeton University economist Christopher Sims, policymakers were told that it may take a massive program, large enough even to shock taxpayers into a different, inflationary view of the future.

"Fiscal expansion can replace ineffective monetary policy at the zero lower bound," Sims said. "It requires deficits aimed at, and conditioned on, 
generating inflation. The deficits must be seen as financed by future inflation, not future taxes or spending cuts."

It was not clear whether such ideas will catch on. But there was a broad sense here that the other side of government may need to up its game.
(Reporting by Howard Schneider; Editing by Chizu Nomiyama)

 https://ca.news.yahoo.com/global-central-bankers-stuck-zero-unite-plea-help-123135496--business.html

5 comments:

Anonymous said...

Haven't we been repeatedly told that the federal reserve bank is defunct? That their charter is expired? What is the federal reserve and Janet Yellen doing meeting again at Jackson Hole, Wyoming? Jackson Hole IS IN the united States! WHY are they being allowed to meet there? And haven't we been told that they are no longer in business in the united States, as the Treasury of the Republic is now in business? So WHY haven't these scumbags from hell been arrested and either sent to the Hague or put in the graybar hotel awaiting trial for the criminal activities committed? Are we being lied to - AGAIN? WHY HAVEN'T THE ANNOUNCEMENT BEEN DONE YET - REPUBLIC RESTORATION, REPUBLIC TREASURY RESTORED, COMMON LAW RESTORED, GOLD BACKED CURRENCY RESTORED, AND NESARA???? WHAT is behind all the DELAYS?

Anonymous said...

How many bills do you spend?
How many coins do you spend?

People want paper, the Fed gives people what they want.
People put coins in jars and do not want to spend them, they believe spending coins is a sign of poverty, and have no idea the real value of the tangible money from the US Mint, an organization that has existed from the time of the Constitution.

People don't know what they want, and the Fed says the people want what the Fed has to offer.

If you went to the bank and asked for a $100 bill, there'd be no issue, but $100 in coins and you'll see some raised eyebrows.

Just saying, people want stuff and in their actions they sabotage anyone who could do something by what they do not comprehend.

And you can't arrest someone who has immunity in a corporate agreement unless and until you can point to them and be the witness to what they did.

The internet is full of accusations from people saying what others have done, and no evidence and no witness. So why are people engaging in spreading claims of criminal acts that can be traced to hearsay and more hearsay? When there is a bonafide criminal complaint naming these people from a bonafide credible witness then the system will do what it's supposed to do.

Tomorrow when you buy your groceries, how much real money are you going to put into the system?
If your purchase is only digits and paper, then I do not know what you are complaining about.
You are helping things move in the direction it is moving; that's why we should not judge others because we know not what we do. It's important to reserve judgment.

I will be spending dollar coins, 50 cent pieces, quarters, and dimes, nickles and pennies with the paper or digits, as part of my solution.
I keep my hands in the Republic with their minted money whenever I can.

Anonymous said...

When will Central bankers ever admit that their money system is altogether flawed, based on false and illogical mathematical theorems? Do they not realize that they can not pass a failed exam and that any review, reprieve or bail-out is an insult and a mockery of enslaved, interest - taxed humanity that now has to deal with the practical implications of hyper-inflation and severely malfunctioning and depressed economies?

Anonymous said...

Now that you KNOW all these things, HOW DOES IT FEEL TO BE CONTINUALLY JERKED AROUND? HOW DOES IT FEEL TO BE CONTINUALLY LIED TO? DECEIVED? HOW DOES IT FEEL TO BE ON THE SLAVE END INSTEAD OF ON THE SOVEREIGN END. AMERICANS, WHAT'S WRONG WITH YOU?! WHY DO YOU ALLOW THEM TO GET AWAY WITH THIS? ALL YOUR 'LEADERS' ARE TRAITORS! THEY ARE WELL ON THEIR WAY TO ELIMINATE YOU PERMANENTLY FOR THEIR OWN BENEFIT AND YOU ARE DOING NOTHING ABOUT IT???

Melisand said...

'Your leaders' ?! Before you 'take US to the woodshed', what makes you think that we AREN'T doing something?!What makes you think we don't know what the hell is going on here?! You think that we don't already KNOW that every last one of our 'leaders' is traitors and what their long-term 'algorithmic' agenda IS?!! We can't educate the entire populace all in a fell swoop! And what about YOU & YOUR country?! I say Clean your OWN house before you look askance at someone else's! So what makes Your country Better than ours or any other country in this Globalistic world and climate?! Is YOUR country transparent and FAIR to its people? Or does it RIP EVERYONE OFF JUST LIKE EVER OTHER TOTALITARIAN SOCIETY?! It is survival time as we fight on many fronts, including staying healthy enough to battle this leviathan!!- E.G. Chemtrails, mass social engineering, p.c. oppression, corrupt penny ante politicians all on the take and standing in the way of justice! EVERYONE should RUN FOR SOMETHING - and OUST the criminals -- Clear the decks and take out the TRASH!!