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George Magnus

Economist and Author

George Magnus

Economist and Author

How Trump could completely reshape the federal reserve

By George Magnus Posted on October 1, 2017November 16, 2017 In United States Federal Reserve, quantitative easing 0

First published: Prospectmagazine.co.uk, 11/11/2017

The resignation of Vice Chair Stanley Fischer reminds us that the fed faces an uncertain future

This Friday will mark ten years since Lehman Brothers filed for bankruptcy.

Whatever happened in the decade before and wherever we want to place the blame, there is no question that the US authorities were out of the blocks pretty quickly to try and contain the financial and economic carnage. They rushed through an $800 billion stimulus programme that President Obama signed into law in February 2009, acted promptly to forcibly recapitalise banks, and the Federal Reserve started quantitative easing (QE) in December 2008. As Washington politics dulled the capacity to use fiscal policy, the Fed was left as the only agency of macroeconomic stability.

By and large, it has done a good job, even if QE has had consequences that weren’t necessarily intended. But ten years on, the Fed faces an uncertain future. We knew this before the surprise resignation of Vice Chair, and second in command, Stanley Fischer last week, but his imminent departure has illuminated the problem anew.

Fischer will be a big loss. He had a stellar reputation as an academic and practical economist and central banker. He governed the Bank of Israel from 2005-13. On monetary policy, he was somewhat on the hawkish side of the Federal Reserves’s policy making committee, but was adamant about not succumbing to political pressures for financial deregulation…..

previously

previously

Can Macron get labour reforms to work?
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up next

The Brexit ghost is haunting party conferences

About

George Magnus

George Magnus

George Magnus is an independent economist and commentator, an Associate at the China Centre, Oxford University, and an adviser to some asset management companies.

He is a regular contributor to the Financial Times, Prospect Magazine and other written media, and appears regularly on BBC TV and radio, Bloomberg TV and other outlets.

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"George Magnus does not look like a prophet. Yet this is the man widely acknowledged to have predicted that the US sub-prime mortgage crisis would trigger a global recession."

- Josephine Moulds, The Daily Telegraph

George Magnus's Viewpoints Blog

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  • Whither China’s investment in the UK
  • Whatever RCEP is, it’s not the answer to the slump in world trade
  • Ofcom, CGTN and BBC row, the latest nail in Britain’s golden era coffin with China
  • It’s ok to call the Chinese Communist Party to account

Latest Articles

  • The High Costs of Disengagement for China

    In this new era of strategic competition between China and the West, disengagement is the order of the day. While this trend will impede economic growth, increase business costs, and raise prices for everyone, the economy that loses the most may well be China’s. Read more →

  • How the West got China so catastrophically wrong

    Fifty years of encouraging closer economic links with Beijing has proved misguided Read more →

  • Sinostan and the Sino-Russian axis

    China has opted at least for now to make its bed with Putin. But at some point, Chinese policymakers will have to weigh its politics-versus-economics contradiction more carefully, and may come to see Putin as a fly in the ointment of their own interests and ambition. Read more →

  • China’s ‘Two Sessions’ paper over cracks in a troubled economy

    The ‘Two Sessions’ held in the People’s Republic of China (PRC) in April sought to guarantee a smooth glide path towards the Chinese Communist Party (CCP)’s 20th Party Congress, scheduled for later this year. But instability rules almost everywhere.... Read more →

  • China Is Facing a Big Contradiction Between its Politics and its Economics

    First published: themarket.ch 01-04-2022

    This is an interview,

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