According to the Economist, central banks are now major creditors of western governments, guarantors of the financial system, set the cost of borrowing, potentially control access to housing finance (via macroprudential policy) and, at the ECB, mediating between the claims of creditor and debtor governments.

Source: Markets: The dangerous politics of central banks | The Economist

This is a first rate article. But what would we do if the central banks sat on their hands, certainly we couldn’t wait for political leaders to act?

Thoughts