Tue Nov 27, 2012, 12:30 PM
pampango (24,088 posts)
Britain Selects a Canadian to Lead the Bank of England
Source: New York Times
In a surprising departure from convention, the British government on Monday selected Mark J. Carney, the head of the Canadian central bank, to succeed Mervyn A. King as the next governor of the Bank of England.
The appointment ended months of jockeying by some of Britainís most prominent public officials. As a result of changes to take effect next year, the job will come with sharply enhanced powers.
The odds had been seen as heavily favoring the Bank of Englandís deputy governor, Paul Tucker. The decision to select a foreigner to lead the bank, Britainís most storied financial institution and the equivalent of the Federal Reserve in the United States, came as a shock when George Osborne, the chancellor of the Exchequer, broke the news during a session of Parliament.
The appointment was arguably the most significant in the bankís 318-year history. Mr. Carney will not only be the first foreigner to lead the bank, but will also take responsibility for the health of the British financial system.
Read more: http://www.nytimes.com/2012/11/27/business/global/canadian-to-lead-bank-of-england.html?pagewanted=all
I know that the UK retains some ties to its former colonies but it is very interesting that they would choose a foreigner to lead their equivalent of the Federal Reserve. Hard to imagine that happening in any other country, particularly in the US. I wonder if British nationalists will look kindly on this.
6 replies, 1788 views
Britain Selects a Canadian to Lead the Bank of England (Original post)
|Nye Bevan||Nov 2012||#5|
Response to pampango (Original post)
Tue Nov 27, 2012, 12:45 PM
OnlinePoker (2,591 posts)
1. Mark Carney steared us through the fiscal mess of the last few years with finesse
I watched Sky News this morning from England and the reaction on the street was "Why a foreigner?". One of the talking heads brought up a good point that just about everybody in the Bank of England, even if they weren't directly involved, had some taint due to the financial quagmire Britain was in over the past few years. Coming from Governor of the Bank of Canada, which has one of the most stable banking systems on earth, Carney is hoped to be seen as a stabalizing factor to the British banking system.
Response to OnlinePoker (Reply #1)
Tue Nov 27, 2012, 02:11 PM
NoOneMan (4,795 posts)
4. Canada spent the last few years kicking the can down the road, creating a financial mess
And it isn't all Carney's fault, but I don't think he deserves praise for Canada's stability (created through cheap money and a resource economy)
Canada's banking system only has some semblance of stability because Canada is subsidizing all the private risk banks take (drastically reducing their lending liability exposure). Instead of clamping down on debt/liabilities and deleveraging, Canada went forward with a 0-down, 40 year loan that anybody and their dog could qualify to buy homes, while the CMHC insured almost every loan that crossed their desk without any type of thorough home appraisal. The result wasn't just home price stabilization while the world was in turmoil, but acceleration of prices and consumer debt:
And now Vancouver home sales have declined 32% and soon Canada is going to be on the hook for a whole lot of risk. If any economies that demand Canada's resources stumble (like China), their economy is finished for a long time. But their banks...hell, they'll be fine.
Response to pampango (Original post)
Tue Nov 27, 2012, 01:31 PM
Anarcho-Socialist (9,591 posts)
2. The mutterings about his nationality will pass
The cries of 'nationality' are from the commentariat who had staked their reputation on someone else being awarded the job and hence the humbug.
With Canada being a Commonwealth country and sharing the same head of state this appointment hasn't altogether upset nationalists. It would have been very different however if a continental European had won the role (especially French or German) given the anti-European instincts of British xenophobia.