BIS Criticizes Central Banks, Neo-Keynesians Vehemently Disagree

The 83rd annual report from the the Bank of International Settlements (BIS) released over the weekend has jumped into the debate between neo-Keynesians and so-called austerians over how to heal the global economy. And the BIS sides mainly with those who favor a more restricted role for central banks.

BIS Speaks Out Against Central Banks

In its annual report released Sunday, the BIS argued that cheap-money policies of central banks cannot by themselves return growth to pre-2008 levels. That approach has also introduced side effects that may be hindering a recovery. It spoke out against the central banks’ “whatever it takes” approach to monetary policy...