Daily Archives: August 23, 2011

Claire Jones

Gill Marcus

Gill Marcus. Image by Getty.

Central bankers tend to pull their punches when it comes to criticising their political masters. In public, at least.

Not so Gill Marcus, the governor of the South African Reserve Bank. In one of the most gloomy – and forthright – speeches I’ve read from a central banker, Ms Marcus attacked politicians for “a lack of strong, unified and credible leadership”, which she said was leading to a loss of confidence and trust in officials and, potentially, the system as a whole.

Linking the unrest in London and Athens with a lack of such leadership, the governor said that in such a climate, “those presenting easy answers to what are very complex and difficult issues can readily gain support”.

The debt-ceiling debacle in the US showed some political factions “were willing to take the country, and indeed the world, over the brink.”

Eurozone leaders’ failure to deal “decisively” with difficult decisions on burden-sharing had “undermined support not only for their leadership but for the whole eurozone project”. She then implied that Greece was insolvent: 

Claire Jones

The European Central Bank’s decision to purchase Italian and Spanish debt sparked fears that the bond buying could stoke inflation, with some believing the central bank would struggle to mop up the money used to buy the debt through its weekly fine-tuning operation.

However, the central bank is so far managing to “sterilise” – as the technique of mopping up the excess liquidity is known – with ease.