Quote of the Week – Punchy and Cynical Definition of Central Banks

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CENTRAL BANK n. A group of economists who believe that their current forecasts will turn out to be accurate even though their past forecasts have been unreliable, that their present policies will succeed even though their past policies have failed, that they can prevent inflation from occurring next time even though they didn’t prevent it last time, they can foster lower unemployment in the future even though their practices worsened it in the past, and so forth. We should now be able to answer this riddle: What’s the difference between a Central Banker and a weather vane? They both turn in the wind, but only the Central Banker thinks he or she determine which way the wind blows.

This is devilishly cynical, but much like most intellectual satire, there is a great amount of truth to it. I give credit to the EconTalk podcast for introducing me to Jason Zweig and the book this is taken from.

 

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