Monetary policy in Sweden has failed. The Riksbank’s policy has led to too low inflation and too high unemployment. The reasons for the failure are that the governor has become too powerful, contrary to the original idea of an executive board with six independent members, and that the oversight and control of the Riksbank by the Riksdag has not worked. To remedy these shortcomings, the democratic control of the Riksbank needs to be enhanced and sharpened, the Riksdag’s appointment policy for the executive board needs to be improved, and the responsibilities of the Riksbank and Finansinspektionen for monetary and macroprudential policy needs to be clarified. Continue reading
Penningpolitiken har misslyckats. Riksbankens agerande har lett till för låg inflation och för hög arbetslöshet. Politiken brister på grund av att Riksbankschefen fått för stor makt och Riksdagens uppföljning och kontroll inte fungerar. För att avhjälpa bristerna bör den demokratiska kontrollen av Riksbanken skärpas, Riksbanksfullmäktiges utnämningspolitik förbättras, och ansvarfördelningen mellan penningpolitiken och makrotillsynen klargöras.
Artikel på DN Debatt, “Skärp den demokratiska kontrollen av Riksbanken,” 2014-05-28, mot bakgrund av en utförligare artikel i Ekonomisk debatt nr 4, “Riksbanken, måluppfyllelsen och den demokratiska kontrollen“. Continue reading
New Ekonomistas post (in Swedish). Here is an English translation.
The Riksbank focuses one-sidedly on the debt ratio, household debt relative to disposable income, as a measure of any risks associated with household debt. An example is the Riksbank’s latest Economic Commentary on household debt, which is discussed in this post. But on a closer examination, the debt ratio is an unsuitable risk measure. There are much better ones. And they give a very different picture of the risks associated with household debt. Continue reading
New Ekonomistas post. This is an English translation.
The Riksbank has, in a new Economic Commentary about household debt, presented with a press conference and a speech by executive board member Cecilia Skingsley, announced what seems to be dramatic conclusions and a big news item, which also been much mentioned in the media:
- The problems associated with debt would be both more extensive and more comprehensive than we have previously realized.
- Households would in general be highly indebted in relation to their incomes, above all low and middle-income earners.
However, the conclusions do not stand up to scrutiny. It appears that the media and general public have been misled. Continue reading