Liebe Wiwis!

Die wöchentlichen WiWi-Diskussionen, zu denen jeder wirtschaftwissenschaftlich Interessierte eingeladen ist, starten dieses Semester am 2.11. mit einem - zu diskutierenden - Gastvortrag von Eckhard Behrens: /„Die Notenbanken müssen höhere Inflationserwartungen herbeiführen! - Über die Entstehung der Finanzkrise und ihre Überwindung"/

Eckhard Behrens ist Volkswirt und Jurist, war u.a. im Kartellamt (1967/68) tätig, ist seit 1972 aktives Mitglied der FDP, und ist Mitbegründer des Seminars für freiheitliche Ordnung e.V. (mehr: http://www.ebehrens.de und www.sffo.de http://www.sffo.de).

Zur Vorbereitung der Diskussion empfiehlt der Referent u.a. die folgende Lektüre: - Artikel des amerikanischen Ökonoms N. Gregory Mankiw in der New York Times (2009): /"It may be time for the Fed to go negative"/ (http://www.nytimes.com/2009/04/19/business/economy/19view.html).

- Rede des heutigen US-Notenbankchef Ben S. Bernanke (2002): /"/*/Deflation: Making Sure "It" Doesn't Happen Here"/ *(http://www.federalreserve.gov/boardDocs/speeches/2002/20021121/default.htm).

- Pressemitteilung der Fed (2008): http://www.federalreserve.gov/newsevents/press/monetary/20081216b.htm

- Rede des schwedischen Ökonoms Lars. E. O. Svensson: /"Monetary policy with a zero interest rate"/ (http://www.riksbank.com/pagefolders/39304/090217e.pdf)

- Paper von Buiter, Willem H. and Panigirtzoglou, Nikolaos (2005): "Overcoming the zero bound: Gesell vs. Eisler" (http://eprints.lse.ac.uk/845/)

- Eckhardt Behrens in Fragen-der-Freiheit (2007): /"Wer zähmt den Hang zur Liquidität?"/ (http://www.sffo.de/sffo/FdF_2007-10-13_Wer-z%E4hmt-den-Hang-zur-Liquiditaet....).

In seiner Pressekonferenz Anfang Oktober in Venedig hat der EZB-Präsident Trichet zum wiederholten Male nachdrücklich betont, dass die EZB stolz darauf ist, die Inflationserwartungen besser verankert zu haben als andere Notenbanken (siehe http://www.ecb.eu/press/pressconf/2009/html/is091008.en.html). Eckhard Behrens wird sich auf folgende Auszüge darau beziehen:

Introductory statement with the Q&A

Jean-Claude Trichet, President of the ECB, Venice, 8 October 2009

…. With regard to price developments, annual HICP inflation stood at -0.3% in September, according to Eurostat’s flash estimate, compared with -0.2% in August. The current negative inflation rates are in line with previous expectations and reflect largely base effects resulting from the movements in global commodity prices a year ago. Also owing to base effects, annual inflation rates are projected to turn positive again in the coming months. Thereafter, over the policy-relevant horizon, inflation is expected to remain in positive territory, with overall price and cost developments staying subdued reflecting ongoing sluggish demand in the euro area and elsewhere. In this context, it is important to re-emphasise that inflation expectations over the medium to longer term remain firmly anchored in line with the Governing Council’s aim of keeping inflation rates below, but close to, 2% over the medium term.

Risks to this outlook remain broadly balanced. They relate, in particular, to the outlook for economic activity and to the evolution of commodity prices. Furthermore, increases in indirect taxation and administered prices may be stronger than currently expected owing to the need for fiscal consolidation in the coming years.

Turning to the monetary analysis, the latest data confirm that developments in broad money and credit growth remain subdued. In August, the annual growth of M3 and loans to the private sector declined further to historically low rates of 2.5% and 0.1% respectively. This parallel deceleration in money and credit growth confirms our previous assessment of a moderate underlying pace of monetary expansion and low inflationary pressures over the medium term.

The ongoing deceleration in annual M3 growth has continued to be accompanied by a strengthening in annual M1 growth, which in August rose further to 13.6%. The strength of M1 reflects the fact that narrower spreads between the rates on different short-term deposits have fostered shifts in the allocation of funds from, in particular, short-term time deposits to overnight deposits. At the same time, the steep slope of the yield curve may have supported shifts from M3 to longer-term deposits and securities outside M3. …..

To sum up, the current rates remain appropriate. The incoming information and analyses since our last meeting in early September have confirmed our previous assessment. While annual HICP inflation was still slightly negative in September, according to Eurostat’s flash estimate, it is expected to turn positive again in the coming months and to remain at moderately positive rates over the policy-relevant horizon. At the same time, the latest information further supports our view that the euro area economy is stabilising and is expected to recover at a gradual pace. However, uncertainty remains high. As regards medium to longer-term inflation expectations, they remain firmly anchored in line with the Governing Council’s aim of keeping inflation rates below, but close to, 2% over the medium term. Cross-checking the outcome of the economic analysis with that of the monetary analysis confirms the assessment of low inflationary pressure over the medium term, as money and credit expansion continues to moderate. Against this background, we expect price stability to be maintained over the medium term, thereby supporting the purchasing power of euro area households.

*Transcript of the questions asked and the answers given by Jean-Claude Trichet, President of the ECB, and Lucas Papademos, Vice-President of the ECB, and Mario Draghi, Governor of the Banca D’Italia*

…. Question: I have two questions today. First of all, the five-year break-even rate, which is one of your favourite gauges of inflation, shows that inflation expectations are at their highest since 2005. Is this a cause for concern? ….

Trichet: As you know – and I am saying this on behalf of the Governing Council – the anchoring of inflation expectations is extremely important to us. We consider it to be essential to enable us to deliver price stability, which is our primary objective. And let me also say that the very solid anchoring of inflation expectations has helped us in both of the directions involved. We were able to avoid the materialisation of deflationary risk in the euro area, because we benefited considerably from the solid anchoring of inflation expectations. In comparison with a number of other economies, we had a more solid anchoring that allowed us to avoid any un-anchoring of inflation expectations. And, in terms of the effectiveness of our own monetary policy action after the crisis, we were helped considerably by the fact that there was no dramatic deterioration of inflation expectations in a downward direction. This anchoring plays an equally important role in avoiding that inflation expectations move upward, which is, of course, something that is also key for a recovery. If we had inflation expectations going upward, this additional spread would be incorporated in the medium and long-term market rates and we would be in a financial environment that would be far more adverse for the recovery we are all aiming for. We are monitoring all the information we receive from the financial markets very carefully: you mentioned the five-years forward on five-years break-even inflation rate. We are also keeping a very close eye on all surveys, those that we undertake ourselves and the surveys that are conducted by the private sector. At the moment, we are of the opinion that, taking into account all aspects, including technical factors, we are maintaining a solid anchoring of inflation expectations. And you can count on the fact that we will continue with great care to ensure that this anchoring remains solid.

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