A Quote by Ben Bernanke
The central bank needs to be able to make policy without short term political concerns.
Related Quotes
A government cannot be expected to allow independence to its central bank unless that bank is also accountable to it and to the wider public. That is, the central bank must be able to be judged on whether or not it has achieved its agreed objective.
Central banks need to be able to buy bonds if there are short-term malfunctions of the markets. But buying bonds without differentiation and without limits would be very problematic.
The principle that a central bank, charged with controlling inflation, should be independent from the government is unassailable. It may also be true that it's easier for the central bank to guard its independence from political pressure when it mainly holds government securities.
Justin Trudeau certainly understands climate science, as do his ministers. But they're refusing to take action on it because of short-term political concerns.
The lesson for Asia is; if you have a central bank, have a floating exchange rate; if you want to have a fixed exchange rate, abolish your central bank and adopt a currency board instead. Either extreme; a fixed exchange rate through a currency board, but no central bank, or a central bank plus truly floating exchange rates; either of those is a tenable arrangement. But a pegged exchange rate with a central bank is a recipe for trouble.
Global central banks are working hard to lift their economies through an aggressively easy monetary policy. The ECB [European Central Bank] and BOJ [Bank of Japan] are buying tens of billions of bonds and other financial securities each month in an effort to stimulate their economies, which is pushing down rates everywhere, including in the U.S.
Monetary policy transmission encompasses the whole continuum of interest rates; of course, the central bank only determines the overnight policy rate.
I have always thought and I still think that the Central Bank should act independently. Indeed, it does, you can take my word. I do not interfere in the decisions of the Central Bank and I do not give instructions to the Bank management or to its head.
I want to make it very clear that this middle-class tax cut, in my view, is central to any attempt we're going to make to have a short-term economic strategy and a long-term fairness strategy, which is part of getting this country going again.
If the short-term decisions you make damage the long term, you should resist those. But there are many short-term decisions that you need to make to be a successful manager.
In a mature economy like India's, which is becoming modern and a financially-oriented economy, an independent central bank, responsible central bank, is really central to success.
The more guidance a central bank can provide the public about how policy is likely to evolve the greater the chance that market participants will make appropriate inferences.
I think everybody knows that Africa is in a very deep crisis. There is economic misery and social deprivation and that Africa needs help but the question then is how. And also we have to make sure that we don't repeat old mistakes; this help is only short term. It doesn't address Africa's long-term fundamental needs and how to put Africa on the right track to development. What Africa needs to do is to grow, to grow out of debt.
The problem is the policy makers don't have practitioners in the policy team. You won't make an IT policy without consulting a Narayan Murthy or Nandan Nilekani. But for energy, people think they know everything and they know what to do for it. That's how the policies are created in Delhi and that needs to change.
The most important thing that a company can do in the midst of this economic turmoil is to not lose sight of the long-term perspective. Don't confuse the short-term crises with the long-term trends. Amidst all of these short-term change are some fundamental structural transformations happening in the economy, and the best way to stay in business is to not allow the short-term distractions to cause you to ignore what is happening in the long term.
The best way that a central bank can support growth on a durable basis is to ensure inflation is low, stable - there is financial stability - and that is the role that the central bank plays.
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