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Comments on: Should the Bank be responsible for economic structure? http://www.tvhe.co.nz/2009/10/30/should-the-bank-be-responsible-for-economic-structure/ The Visible Hand in Economics Wed, 18 Nov 2009 22:10:38 +0000 hourly 1 https://wordpress.org/?v=6.9.4 By: TVHE » Goff announces end to RBNZ independence if Labour gets back in http://www.tvhe.co.nz/2009/10/30/should-the-bank-be-responsible-for-economic-structure/#comment-21896 Wed, 18 Nov 2009 22:10:38 +0000 http://www.tvhe.co.nz/?p=4417#comment-21896 […] we have discussed this stuff constantly (here, here, here, and here).  Phil Goff, I thought you were a pretty cool guy, but to be honest this makes me […]

]]> By: mark http://www.tvhe.co.nz/2009/10/30/should-the-bank-be-responsible-for-economic-structure/#comment-21809 Fri, 06 Nov 2009 17:19:38 +0000 http://www.tvhe.co.nz/?p=4417#comment-21809 @Darrell
“I do need to be aware of the impact of a higher or lower dollar because that will impact my bottom line too”
I agree with this; however, how can you actually regulate it, or perhaps a better question; WHO? and how do we keep regulation accurate?

]]> By: Matt Nolan http://www.tvhe.co.nz/2009/10/30/should-the-bank-be-responsible-for-economic-structure/#comment-21774 Tue, 03 Nov 2009 03:17:44 +0000 http://www.tvhe.co.nz/?p=4417#comment-21774 @Miguel Sanchez

I do agree – there idea of imbalances is more “global”.

However, both the RBA and the RBNZ are concerned about too much consumption. I think the question should then be, why do we have too much consumption?

I think if we started thinking about it, policy decisions would seem very different …

]]> By: Olesya@overeaters anonymous http://www.tvhe.co.nz/2009/10/30/should-the-bank-be-responsible-for-economic-structure/#comment-21764 Sun, 01 Nov 2009 02:57:12 +0000 http://www.tvhe.co.nz/?p=4417#comment-21764 of course they should. As soon as they Fed discontinued publishing M3 we all knew something was up. Actually holding someone accountable other than the small time schmoe taking out a mortgage he cant afford isnt something I see happening. Banks get bailed out and bonuses. Little guys get the shaft

]]> By: Darrell http://www.tvhe.co.nz/2009/10/30/should-the-bank-be-responsible-for-economic-structure/#comment-21763 Sat, 31 Oct 2009 17:08:13 +0000 http://www.tvhe.co.nz/?p=4417#comment-21763 Your article today resonates so well here in Canada. Its a constant back and forth daily issue with a higher Canadian dollar and what its doing to the economy and specifically exporters and manufacturing.

The fact here in Canada, with a higher dollar and likewise in NZ, it will always be a balancing act. When one area is impacted, the other areas get hit. As a home based business owner, I do need to be aware of the impact of a higher or lower dollar because that will impact my bottom line too.

I am not sure what would would strike the right balance.

Regards,

]]> By: Mohsin http://www.tvhe.co.nz/2009/10/30/should-the-bank-be-responsible-for-economic-structure/#comment-21756 Fri, 30 Oct 2009 11:13:07 +0000 http://www.tvhe.co.nz/?p=4417#comment-21756 I really agree with the fact that a separate institutions for monetary policy and financial stability is the need of the hour.

]]> By: Interest Rates » TVHE » Should the Bank be responsible for economic structure? http://www.tvhe.co.nz/2009/10/30/should-the-bank-be-responsible-for-economic-structure/#comment-21753 Fri, 30 Oct 2009 07:44:23 +0000 http://www.tvhe.co.nz/?p=4417#comment-21753 […] Read the rest of this great post here […]

]]> By: Miguel Sanchez http://www.tvhe.co.nz/2009/10/30/should-the-bank-be-responsible-for-economic-structure/#comment-21751 Fri, 30 Oct 2009 03:30:04 +0000 http://www.tvhe.co.nz/?p=4417#comment-21751 I suspect that by “imbalances” the RBA really means excess demand, which means inflation. The fact that they’ve only just started using the word makes me wonder if it was really meant as a shot at the RBNZ.

]]> By: Matt Nolan http://www.tvhe.co.nz/2009/10/30/should-the-bank-be-responsible-for-economic-structure/#comment-21746 Fri, 30 Oct 2009 00:44:40 +0000 http://www.tvhe.co.nz/?p=4417#comment-21746 @Miguel Sanchez

Well on that note the RBA is wrong. You shouldn’t use interest rates to do anything expect control inflation expectation – one instrument one target. Prudential regulation can be included to adjust for structure.

Furthermore we have to ask, why do we have structural issues? I don’t think imbalances in the economy evolved out of monetary policy – I would be quicker to blame fiscal policy myself 😛

]]> By: Miguel Sanchez http://www.tvhe.co.nz/2009/10/30/should-the-bank-be-responsible-for-economic-structure/#comment-21745 Fri, 30 Oct 2009 00:33:34 +0000 http://www.tvhe.co.nz/?p=4417#comment-21745 I actually came to a different conclusion than you about having separate institutions – my view is that if there is a perceived conflict between monetary policy and financial stability then the RBNZ should be able to have that debate internally, without inflicting it on the public. If the RBA thought like the RBNZ then you probably would see them nagging APRA about stability issues; instead, they agree that the way to deal with imbalances is to raise interest rates, and said as much in their last policy statement.

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