Our Overburdened Central Banks – Clive Crook – The Atlantic

26 Jul

Follow the link and look at the chart.

Here’s a chart from the report that’s worth a look. It shows the economic interactions among three sectors: government, households/firms, and finance. Each pairwise interaction is a self-aggravating cycle, and central banks are being asked to intervene at all three points. I remember when monetary policy used to be one target (prices), one instrument (interest rates). Happy days.

That’s three autocatalytic potentially out-of-control loops, each draining the central banks.

via Our Overburdened Central Banks – Clive Crook – The Atlantic.

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