Send this article to a friend: March |
Central Banks Losing Credibility Fast The last two weeks have been extremely fascinating to watch as two of the world’s most powerful central banks showed themselves to be naked before the world in regards to their ignorance and ineptitude in trying to deal with the West’s current and future monetary policies. The first public spectacle took place in Europe on March 9, when ECB Chairman Mario Draghi stood pat with interest rates in the wake of rising inflation and a slowing EU economy, while stating that the central bank would continue to buy bond issuances through the end of this year. A week later it was Janet Yellen’s turn to take her road show out of the basement of the Eccles building and into the sunlight where as expected, the Fed raised interest rates a quarter point at a time when the economy was expected to only grow by less than 1%. Needless to say, market reactions in both the U.S. and Europe were not what either central bank head was expecting. And calls for their heads on a platter continued to rise as it appears more and more that both the markets and the public no longer trust the direction of the central banks. And to add insult to injury, on March 21 none other than the ECB’s biggest supporter Germany publicly called for more transparent accountability by the European Central Bank, and in essence started their own ‘Audit the ECB’ movement to mirror the one occurring right now in the U.S. Congress regarding their own central bank.
Ironically, calls for auditing two of the most powerful central banks may intrinsically be tied to the rising wave of populism that threatens to bring down not only establishment governments, but also the EU and Euro currencies themselves. And following years of central bank Presidents like Mario Draghi, Ben Bernanke, and Janet Yellen continuously lying about how good the economy really is when the people themselves recognize that they are far worse off than before the 2008 financial crash, the motivating factors of Brexit and Donald Trump are scaring the daylights out of establishment oligarchs such as Angela Merkel and Wolfgang Schauble. It would have been unthinkable just 12 months ago for a sovereign leader in Europe, or even one of their finance ministers, to possibly consider the idea of auditing the ECB. But that appears to no longer the case as governments are quickly looking for scapegoats to blame in what they know deep down is coming for their economies, and even their political lives.
As a historian in his primary field of study, and an investor in the real world, Kenneth Schortgen has a keen perspective on all facets of the financial world. He has owned his own business and corporation, and has been an investor in many different markets such as securities, real estate, currency trading, and international trusts. Kenneth Schortgen Jr.His desire is to provide you with the true understanding of markets and the economy, and to give you the information that will help you make your own decisions in these troubling, and quite often, fascinating times regarding your economic decisions. Kenneth is not a certified financial advisor, and his only goal is to give you true information, by which you can see things as they happen, and in many cases, before they happen
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