Morning Macro – Weekend Edition 11 February



Here is our full interview with Jeromin Zettlemeyer, senior fellow at the Peterson Institute where he discusses the New Global Safety Net, the mechanism to help countries facing financial crisis.

The Net used to consist only of the International Monetary Fund, but following the Asian crisis of the 1990s and then the European crisis new mechanisms have evolved: Regional Financing Arrangements and currency swaps between a number of central banks such as the US Fed, Bank of England, Bank of Japan, the Swedish Riksbanken etc.

It’s still too early to tell how effective this system is – Zettlemeyer has his doubts – and inherent moral hazard is still an unresolved problem.


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