The Pending Federization of Stanley Fischer?

The Pending Federization of Stanley Fischer

Stanley Fischer is former central bank kingpin in Israel, where he amassed an enviable record of guiding the Mideast state through the global Great Recession with only a scrape or two.

Though he espouses adjustable inflation-targeting more than the locally preferred shooting for steady increases in nominal GDP (Market Monetarism), who knows?—it may amount to the same thing in practice.

That is to say, one central banker may say, “Inflation is too low, and we need to be a little flexible anyway, let’s do $85 billion a month in QE,” and the next may say, “NGDP is too low, let’s do $85 billion a month in QE.”

In practice, the same policy, despite all the complicated arguments behind each approach.

We can hope that Fischer is, at least, not peevishly fixated on obtaining microscopic rates of inflation, or even zero inflation, an idea now zealously touted by such monetary thinkers as John Cochrane of University of Chicago or Charles Plosser, the Philly Fed bank chief. With the PCE deflator at 1 percent, the stiff-necked “no inflation” crowd has near-guttural blood-lust to savage that last yet initial digit, economic growth be damned.

But Hopes May Be Dashed…

Read the whole article here.

*Photograph by Jerome Favre/Bloomberg

About the Author

The Corner
The Corner has a team of on-the-ground reporters in capital cities ranging from New York to Beijing. Their stories are edited by the teams at the Spanish magazine Consejeros (for members of companies’ boards of directors) and at the stock market news site Consenso Del Mercado (market consensus). They have worked in economics and communication for over 25 years.

1 Comment on "The Pending Federization of Stanley Fischer?"

  1. Stanley Fischer’s appointment to the Fed is awesome news! Dr. Fischer is a genius. His crisis management expertise with global institutions is exactly what the Federal Reserve needs. I predicted his nomination last month:

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