Ultra Easy Money: Digging the Hole Deeper
This is a transcript of the keynote speech delivered by William White, chairman of the OECD Economic and Development Review Committee, at the LBMA/LPPM Conference in Singapore, 16-18 October, 2016.
Topics addressed include: knowledge and policy; ultra-easy money; the global financial crisis; moving forward; unintended consequences; economic and political dangers; predictions; and good luck.
In conclusion, White said: “I think we have run out of room on monetary policy. I am pleased to say that the central bankers seem to be agreeing, increasingly. I wish they had agreed years ago. This means governments have to step in, in one form or another. There are various things they could do. The sadness about it is that even if you can see a way in which governments could get us out of all of this mess we are currently in, they are not going to do it. Such changes are unlikely. I think this has its roots in psychology. Changing your view of the world is always extremely hard, and it is never harder than when you are in the middle of a crisis and you really want to hold on to the old beliefs…There is a way out on the economics side, but there is no way out on the political side. When Joseph Schumpeter was once asked, ‘what is the essence of economics?’, he famously answered, ‘politics, politics, politics.’ Finally, I wish you good luck—you just might need it.”