Blog
The MPC - snoozing whilst the UK burns
7th October 2008
From Doug McWilliams at the CEBR comes a hard hitting comment piece about the out of touch and out-moded Monetary Policy Committee.
“The Governor of the Bank of England and both his deputies have had careers in academia and the civil service. The Permanent Secretary to the Treasury was chosen over the heads of more experienced candidates because he was the most left wing of the candidates. The Monetary Policy Committee now seems to be comprised of relative unknowns, when high quality monetary economists like Charles Goodhart would apparently have been willing to be reappointed when their terms ended. No wonder that the authorities give the impression of being a senior common room discussion group rather than people who understand how to handle the fragile confidence in financial institutions.”
Well said, the Australian Central Bank has given a clear lead by cutting interest rates by 1% in a surprise move. Fingers crossed for a further bout of policy activism this coming Thursday when the MPC votes. But don’t hold your breath!
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Geoff Riley
Geoff Riley FRSA has been teaching Economics for over thirty years. He has over twenty years experience as Head of Economics at leading schools. He writes extensively and is a contributor and presenter on CPD conferences in the UK and overseas.