The BoE Will Be Graced with a Superhuman Governor

Yesterday the financial press was aflutter with reports about the nomination of the current chairman of Canada's central bank, Mark Carney, as the new governor of the Bank of England.

Most of the reports were gushing about the alleged ability of this central planner, to,  well, plan better than his peers. Apparently he is needed now to 'rescue' the UK. A good example for this is this article at Bloomberg, from which we quote a few excerpts below:


Carney is a fantastic central banker,” Edmund Clark, chief executive officer of Toronto-Dominion Bank (TD), Canada’s second-biggest by assets, said in an interview yesterday. “He’s clearly been recognized around the world for that, and so Britain, from its point of view, did a smart thing.”

A day after watching one of his four school-age daughters play ice hockey in downtown Ottawa, Carney, 47, was named yesterday by U.K. Chancellor of the Exchequer George Osborne as the first ever foreigner to run the 318-year-old Bank of England and its youngest boss in more than half a century.


“We needed the best, and in Mark Carney we’ve got it,” Osborne said at the end of a 10-week official search after the Canadian’s virtually unique blend of experience in banking, policy making and regulation beat out other contenders.

[…]

Carney “is head and shoulders above the other candidates,” David Blanchflower, who helped set U.K. interest rates until May 2009 and now teaches at Dartmouth College in Hanover, New Hampshire, said yesterday on Bloomberg Radio’s “The Hays Advantage” with Kathleen Hays and Vonnie Quinn. “He’s going to come in with a big broom and sweep clean at the Bank of England, which is what is needed.”

“In an environment of international financial regulation, having somebody who has a strong track record in that is clearly important,” Donovan said. “The nationality is entirely incidental.”

 

(emphasis added)

Well, we do believe that 'nationality is entirely incidental' when someone has been with Goldman Sachs for 13 years. Ex-Goldman employees have taken over important regulatory posts all over Europe after all, including the presidency of the ECB.

Hundreds of articles in style and tone of voice akin to the above have appeared in the financial press yesterday. We have yet to come across even a single critical remark. It astonishes us to no end that central bankers have become such exalted figures in our modern society. How can bureaucrats inspire such unrestrained awe? Consider some of the statements above.

See, he is human (watching his daughters play ice hockey), but in reality, this bureaucrat is a regular super-human. What would we ever do without irreplaceable, exalted personalities like him? How could the market economy ever function properly without such people 'directing' it?

Allegedly Carney has left Canada in ruddy economic health. No-one deigned to mention that Canada owes its seeming economic health largely to high commodity prices these days, which to be sure owe far more to the actions of Ben Bernanke and the PBoC than to Mark Carney. What is 'incidental' is that Carney happened to occupy the post of central bank chairman in Canada just as this phase of high commodity prices occurred.

However, what will this 'giant of central banking' (he was voted 'central banker of the year' by some magazine a year or two ago) really leave Canada with?

How about: the biggest credit bubble in the country's history, one result of which is that over 30% of Canadians confessed in a recent survey that they have trouble sleeping due to worries about their huge debts?

How about a real estate bubble that has in places grown to such proportions as to stand as almost unique in human history? A bubble that absolutely dwarfs the real estate bubble that has come to such ignominious grief in the US and elsewhere?

His 'great feat' consists of having nudged the central bank's administered interest rate to all of 1%. Well, BFD. We realize of course that in order to arrive at this carefully planned, 'just right' one percent interest rate, countless meetings had to be held and reams of economic statistics had to be poured over. And yet, it is almost certain that this interest rate deviates from the natural rate indicated by society-wide time preferences and therefore distorts prices across the economy and causes malinvestment– which as it were should be blindingly obvious considering the real estate bubble.

We should not cower in awe before these bureaucrats, who have on the whole probably held back economic progress by decades and created untold misery in many regions of the world, while in the main greatly benefiting the banking cartels over which they preside.

That Mr. Carney's stint at the Bank of Canada is today fondly remembered and destined to become part of its lore of 'success' is a complete coincidence. Had Mr. Greenspan vacated his post at the Fed just five or six years earlier than he did, he would today also be remembered as one of the 'greatest central bankers ever', simply because his chairmanship coincided with a big boom.

This has nothing to do with the 'planning abilities' of these men. This is not to say that Mr. Carney is not an intelligent and talented man. He undoubtedly is that, which is already proven by where his career has led him. However, it is the height of conceit to believe that anyone can 'plan' the economy, or know what the proper interest rate and the proper height of the money supply should be. These are things that can only be optimally determined by the market. The reality is that we have a socialistic monetary system that is in the process of failing – we are witnessing what are probably its death throes. Carney will now head a central bank that has bought up almost one third of the government debt in issue, not surprisingly to no discernible positive effect. He will likely find out that this sinking ship will prove more difficult to steer than the one he is leaving.

 


 

Even Canada's finance minister Jim Flaherty stares in awe at the super-human bureaucrat who is now leaving his employ …

(Photo by Fred Chartrand / The Canadian Press)

 


 
 

Emigrate While You Can... Learn More

 
 

 
 

Dear Readers!

It is that time of the year again – our semi-annual funding drive begins today. Give us a little hand in offsetting the costs of running this blog, as advertising revenue alone is insufficient. You can help us reach our modest funding goal by donating either via paypal or bitcoin. Those of you who have made a ton of money based on some of the things we have said in these pages (we actually made a few good calls lately!), please feel free to up your donations accordingly (we are sorry if you have followed one of our bad calls. This is of course your own fault). Other than that, we can only repeat that donations to this site are apt to secure many benefits. These range from sound sleep, to children including you in their songs, to the potential of obtaining privileges in the afterlife (the latter cannot be guaranteed, but it seems highly likely). As always, we are greatly honored by your readership and hope that our special mixture of entertainment and education is adding a little value to your life!

   

Bitcoin address: 1DRkVzUmkGaz9xAP81us86zzxh5VMEhNke

   
 

4 Responses to “Mark Carney – Exalted Central Planner”

  • jimmyjames:

    His ‘great feat’ consists of having nudged the central bank’s administered interest rate to all of 1%. Well, BFD. We realize of course that in order to arrive at this carefully planned, ‘just right’ one percent interest rate, countless meetings had to be held and reams of economic statistics had to be poured over.

    ***********

    I think his greatest feat was the slick transfer of the coming massive defaults from his pet bankers onto the backs of the people via CMHC-

    ***********

    (warning…this PDF is the most mind numbing piece of garbage you ever did see)

    CMHC’s total insurance-in-force increased to $576 billion at the end of the second quarter of 2012, nearly 2% higher than total insurance-in-force at year end 2011 and 1% higher than in the first quarter of 2012.

    These government insurance guarantees are now close to 1 trillion- in a country with a population of just over 30 million which would be equivalent to about 10 trillion in the US-

  • rodney:

    He will likely find out that this sinking ship will prove more difficult to steer than the one he is leaving.

    The sinking ship reference was the first thing that came to my mind upon reading this news. He would have been ‘clever’, in the sense of rats being the first to abandon ship (the sinking ship of a soon-to-burst housing bubble), if he had left the BoC to pursue some other endeavor. But taking the job at the BoE is his dumbest move ever.

    The reason for that is that a central bankers’ only tool is monetary easing, and it’s not as if the BoE hasn’t tried that in spades. Of course, their hubris will be their undoing, and no one will experience that sooner than Carney.

    Useless and idiotic financial reporters. It will be fun to watch when Carney is universally criticized for his inability to ‘plan’ a recovery in the UK.

  • hettygreen:

    That’s Mark Carney Pater…And Jim Flaherty would stand in awe of a popsicle melting.

    There’s something on offer on the same subject over at Naked Capitalism (November 28 – Marshall Auerback – ‘Bank of Canada Governor is Wrong on Too Big to Fail and Wrong on Canada’s Banking System’). Sorry but I’m having trouble posting a link here.

    I have to say they (our current political hacks and their media minions) have done a stellar job of convincing everyone in this country that our ‘banking shit’ doesn’t stink like everyone else’s.

Your comment:

You must be logged in to post a comment.

Most read in the last 20 days:

  • factoryA Striking Chart
      The Economy and the Stock Market As long time readers know, we are always paying close attention to the manufacturing sector, which is far more important to the US economy than is generally believed. In terms of gross output it is the largest sector of the economy, and it should of course be obvious that saving, investment and production are the only ways to create wealth.   What's left of the Brooklyn Domino Sugar Refinery. Photo credit: Paul Raphaelson   Contrary...
  • trump-putin-1024Trump and Putin Narrowly Escape Assassination Attempt
      The Gloves are Coming Off First a little bit of recent history. Readers are probably aware that some questions about the occasionally malfunctioning Deep State android... no, wait, we'll start again. Questions have recently been raised about the health of presidential candidate Hillary Clinton by various “alt-right” tinfoil hat-wearing conspiracy theorists, such as this one.   The monsters are normally hiding under Hillary's bed, but lately they have come out into the open...
  • swing-voterWhy the Fed Destroyed the Market Economy
      What Have You Done for Me Lately? Swing voters are a fickle bunch.  One election they vote Democrat.  The next they vote Republican. For they have no particular ideology or political philosophy to base their judgment upon.   The primacy of the wallet.   They don’t give a rip about questions of small government or big government.  Nor do they have any druthers about the welfare or warfare state. In effect, they really don’t care.  What’s important to the...
  • trump-mapDonald’s Electoral Struggle
      Wicked and Terrible After touting her pro-labor union record, the Wicked Witch of Chappaqua rhetorically asked, “why am I not 50 points ahead?”  Her chief rival bluntly responded: “because you’re terrible.”*  No truer words have been uttered by any of the candidates about one of their opponents since the start of this extraordinary presidential campaign!   Electoral map (note that the coloration may no longer be applicable...)   That Hillary Clinton is...
  • wallet-367975_960_720Janet Yellen’s Shame
      Playing Politics In honest capitalism, you do what you can to get other people to voluntarily give you money. This usually involves providing goods or services they think are worth the price. You may get a little wild and crazy from time to time, but you are always called to order by your customers.   In the market economy, consumers reign supreme. There is no such thing as a “lost” vote in the marketplace; every penny spent affects production. Mises noted: “Consumers...
  • warren-buffett-gold-coinGet Ready for a New Crisis – in Corporate Debt
      Imposter Dollar OUZILLY, France – We’re going back to basics here at the Diary. We’re getting everyone on the same page... learning together... connecting the dots... trying to figure out what is going on.   The new three dollar bill issued by the Apprehensive States of America.   We made a breakthrough when we identified the source of so many of today’s bizarre and grotesque trends. It’s the money – the new post-1971 dollar. This new dollar is green. You...
  • 4-ip-and-non-def-capital-goods-ordersThe Economy, the Stock Market and the Fed
      John Hussman on Recent Developments We always look forward to John Hussman's weekly missive on the markets. Some people say that he is a “permabear”, but we don't think that is a fair characterization. He is rightly wary of the stock market's historically extremely high valuation and the loose monetary policy driving the surge in asset prices.   The S&P 500 Index and the NYSE advance-decline line. Most market internals weakened steadily until early February 2016, but...
  • silkroadHanjin Marooning in San Pedro Bay
      Global Trade Reversal Expansions and contractions in global trade have played out over long secular trends for thousands of years.  The Silk Road, for example, was established by the Han Dynasty of China in 130 BC, and allowed for continuous trade between East and West for nearly 1,600 years.  In addition to economic trade, the Silk Road was also a conduit for culture and knowledge among its network of civilizations.   A map of the main ancient Silk Road - click to...
  • voltaireGreat Causes, a Sea of Debt and the 2017 Recession
      Great Cause NORMANDY, FRANCE – We continue our work with the bomb squad. Myth disposal is dangerous work: People love their myths more than they love life itself. They may kill for money. But they die for their religions, their governments, their clans... and their ideas.   Famous French hippie and author Voltaire. He wears the same sardonic grin in every painting, whether he's depicted at a young or an old age, doesn't matter. His real name was François-Marie Arouet; he...
  • wilsonand-morganThe Donald Versus Killary: War or Peace?
      War: A Warning from the Past Although history does not exactly repeat itself, it does provide parallels and sometimes quite ominous ones.  Such is the case with the current U.S. Presidential election and the one which occurred one hundred years earlier.   The Donald probably has the better slogan...   The dominating question which hung over the 1916 campaign was whether the country would remain neutral in regard to the horrific slaughter which was taking place on the...
  • hittite-leftoversA Rift in the Space-Time Continuum
      Weird and Unnatural NORMANDY, France – First, a quick look at the markets. The Dow bounced on Monday, recovering 239 points of the nearly 400 it lost on Friday. Why the comeback?   FOMC member Lael Brainard: her comments on Monday were touted as the “reason” for the stock market recovering half of Friday's losses. We suspect the real reason is the triple witching on Friday... Photo via twitter.com   The financial press has a ready answer: “Stocks gain...
  • ukraine-mapCrimea: Digging For The Truth
      Renewed Escalation This summer witnessed a renewed escalation between Russia and Ukraine after Russian President Vladimir Putin accused Ukraine of sending saboteurs to attack Russian troops, targeting “critical infrastructure”. Kiev denied the allegations and claimed Russia’s “fantasy” was nothing but a false pretense to launch a “new invasion”.   August 10: Russian president Putin announces that there was an altercation involving a group of Ukrainian saboteurs at...

Austrian Theory and Investment

Support Acting Man

Own physical gold and silver outside a bank

Archive

j9TJzzN

350x200

Realtime Charts

 

Gold in USD:

[Most Recent Quotes from www.kitco.com]

 


 

Gold in EUR:

[Most Recent Quotes from www.kitco.com]

 


 

Silver in USD:

[Most Recent Quotes from www.kitco.com]

 


 

Platinum in USD:

[Most Recent Quotes from www.kitco.com]

 


 

USD - Index:

[Most Recent USD from www.kitco.com]

 

THE GOLD CARTEL: Government Intervention on Gold, the Mega Bubble in Paper and What This Means for Your Future

 
Buy Silver Now!
 
Buy Gold Now!
 

Oilprice.com