Interference Day

Author: The Economist Editorial Board

The Economist

April 13th, 2019

Page 11

Cecily N. Bright

Mr. O’Grady

Contemporary World Issues

April 26th, 2019

 As of right now, April 2019, the Central Banks are very vulnerable. They are under attack

due to inflation. Inflation is not a new concept to banks, let alone the central bank. In fact, in the

1970s, the banks had to change their ways because of it. The banks could have stopped the

inflation if the politicians worked with them. Basically, all the politicians had to do was deal with

the short term cost of higher unemployment. If they did this then this short term problem of

inflation, could have been stopped, which benefits them in the long run. President Trump, is

known for not liking a lot of things, but one thing he really does not like would be interest rates.

He has even demanded that they be slashed, and is speculated to fire the current boss of the

Federal Reserve, Jerome Powell, who he appointed. Global inflation in the last two decades, has

been only 4% per year. This is because the White House has not publically discussed the Fed

policy. Overall, the global economy has hit a record low, but a solution to this would be the

global cooperation of the central banks and the Fed. Another solution to both the low global

economy and central bank problem would be for the central banks to make their important

decisions in private, and then go public once they have a solution or ideas. When they publicize

their thinking process, they leave it open to everyone’s opinions, this can cloud the process

which does not help them in finding a solution. This also opens them up to all of the external

pressures and concerns, when in reality their solution does not have to focus on one specific

group of people, it has to be positive for the general public, because in reality, not everyone is

going to be happy with their solution.