What Is the Point of Central Banks’ Interventions?
Part of the Palgrave Macmillan Studies in Banking and Financial Institutions book series (SBFI)
There is a saying in the financial industry that, while central bankers have not been perfect, politicians have been worse. When governments took responsibility for decisions that should have been made by the central banks, or dominated central banking policies, they created a devastating inflation that:
Distorted incentives, and
Imposed the worst sort of taxation on the whole population.
KeywordsMonetary Policy Central Bank Federal Reserve Deposit Insurance Federal Fund Rate
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© Dimitris N. Chorafas 2012