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Questo articolo è stato pubblicato il 03 ottobre 2013 alle ore 15:07.


PRINCETON – The US Federal Reserve’s recent surprise announcement that it would maintain the current pace of its monetary stimulus reflects the ongoing debate about the desirability of cooperation among central banks. While the Fed’s decision to continue its massive purchases of long-term assets (so-called quantitative easing) was motivated largely by domestic economic uncertainty, fears that an exit would trigger interest-rate spikes in emerging economies – especially Brazil, India, Indonesia, South Africa, and Turkey – added significant pressure. But should central banks’ decision-making account for monetary policy’s spillover effects?

Discussion of central-bank cooperation has often centered on a single historical case, in which cooperation initially seemed promising, but turned out to be catastrophic. Like most of our modern cautionary tales, it comes from the Great Depression.

In the latter half of the 1920’s, there was almost constant transatlantic tension, as US monetary policy drove up borrowing costs and weakened GDP growth in Europe. In 1927, at a secret meeting on New York’s Long Island, Europe’s leading central banks convinced the Fed to cut its discount rate. Although the move helped to stabilize European credit conditions in the short term, it also fueled the speculative bubble that would collapse in 1929.

Cooperation in the 1920’s was both novel and fragile, based as it was on the friendship between Bank of England Governor Montagu Norman and Benjamin Strong, Governor of the Federal Reserve Bank of New York, and, to a lesser degree, their ties with the president of Germany’s Reichsbank, Hjalmar Schacht.

The oddly intimate and affectionate relationship between Strong and Norman included regular visits, telephone conversations (a novelty at the time), and an extensive and bizarre correspondence, in which they discussed personal matters as much as monetary issues. Strong once wrote, You are a dear queer old duck, and one of my duties seems to be to lecture you now and then.

By the late 1920’s, though, Strong was dying of tuberculosis and Norman was experiencing successive nervous breakdowns. Their legacy of cooperation would soon crumble, too, with most observers concluding after the Great Depression that central banks should be subject to strict national controls to block future efforts at collaboration.

Central-bank cooperation in the aftermath of the 2008 financial crisis has unfolded in a remarkably similar manner. Initially, increased cooperation seemed to be just what the doctor ordered, with six major advanced-country central banks lowering their policy rates dramatically on October 8, 2008 – three weeks after the collapse of US investment bank Lehman Brothers – in a coordinated effort to stabilize plunging asset markets. They subsequently pumped huge amounts of liquidity into the banking system, thereby averting a total collapse.

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