Pietro Reichlin's picture
Affiliation: 
Università LUISS G. Carli
Credentials: 
Professor of Economics

Voting history

Labour Markets and Monetary Policy

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Question 2: Do you agree that, in a period of great uncertainty and after a prolonged period of weak real wage growth, monetary policy makers can afford to wait for greater certainty about real wage developments and building inflationary pressure before raising interest rates?

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Answer:
Agree
Confidence level:
Confident
Comment:
In addition to wage growth being less responsive to falling unemployment, I would add that credit growth is not particularly strong and the overall economic scenario appears to be subject to many risks.

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Question 1: Do you agree that a strong labour market is a good indicator of building inflationary pressure?

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Answer:
Disagree
Confidence level:
Not confident
Comment:
I tend to agree with Summers that changing conditions in the labor market (de-unionization, digitalization, globalization, etc.) may have contributed to the weaker negative correlation between inflation and labor market slackness.

Bitcoin and the City

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Question 2: Do you agree that the regulatory oversight of cryptocurrencies needs to be increased?

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Answer:
Disagree
Confidence level:
Confident
Comment:
I share the view that bitcoins are mostly held as store of value in limited supply (similar to gold). Holders are mainly motivated by speculative activity and subject to risks of capital losses. As long as bitcoin holders are aware of what these risks are, I don't see why we need more regulation or oversight than it already in place for other stores of value. The power of monetary policy may not be affected by bitcoin diffusion, since Central Banks (or governments) are the only authorities able to provide the fiscal backing required to offer safe assets and generate lender of last resort type of policies.

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Question 1: Do you agree that cryptocurrencies are currently a threat to the stability of the financial system, or can be expected to become a threat in the next couple of years?

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Answer:
Disagree
Confidence level:
Confident
Comment:
Despite the volatility and the bubble component of bitcoin valuation, it appears the number of bitcoin users and transactions are not large enough and sufficiently interconnected to represent a high risk of contagion.

Global risks from rising debt and asset prices

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Question 2: Is the loose monetary policy of major central banks responsible for the recent increase in global leverage or asset values?

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Answer:
Agree
Confidence level:
Confident
Comment:
Loose monetary policy is a factor contributing to higher asset values. On the other hand, in the EMU, this type of policy may be the only way to compensate for the lack of a super-national fiscal policy and the inability to issue Euro bonds, i.e., safe assets.

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