Raghuram Rajan, the governor of the Reserve Bank of India , questions the unconventional monetary policies central banks are pursuing and claims that pushing down interest rates results in people saving rather than spending. Rajan’s views echo those who criticize central bank policies, which have included restraining digital currencies.
On leave from a teaching post at the University of Chicago, Rajan offered his insights during the International Monetary Fund (IMF) spring meeting in Washington, D.C. in an interview with MarketWatch . Raghuram Rajan A persistent critic of Fed quantitative easing, Rajan said raising rates at a measured pace would give other central banks room to change from unconventional policies when a recovery becomes evident. Rajan served as the chief economist of the IMF where he raised concerns about the risks to the financial system prior to the financial crisis. Rajan Joins Central Bank Critics
Rajan is among those who have criticized central banks for implementing policies that create negative interest rates. Financial commentator Max Keiser has noted that the global financial system no longer possesses the productive capacity to generate enough income to sustain current asset value, according to CCN . And when “tomorrow” cannot be paid, the current financial regime will fail.
Rajan, in his remarks, did not specifically address digital currencies. But central banks, who are coming under scrutiny for various reasons, in some cases have attempted to control digital currencies.
Russia in 2014 announced plans to ban bitcoin, CCN reported. Last month, that country’s deputy minister of finance expressed hoped that a law calling for the criminalization of bitcoin will be passed to the lower chamber of the Russian Parliament before the end of the current session in August.
Recently, there have been signs of central banks taking a new approach to digital currency.
The People’s Bank of China (PBOC) […]
