Interview with Volker Wieland: "Monetary policy should be more rule-oriented" ("Börsen-Zeitung")

In an interview with the financial newspaper "Börsen-Zeitung" Volker Wieland has called for a rethinking in central banks. In his view, apart from the insufficient financial market regulation, the low interest rates in den United States ahead of the financial crisis were the driving forces for the subprime boom that caused the financial crisis. It would have been helpful if interest rate rules as the Taylor rule had been taken into account. "Central banks rather should act according to such rules instead of making descretionary decisions", Wieland said.

According to Wieland, central banks should draw the right conclusions from the financial crisis and not repeat them in the future. The central bankers at the Fed should stop insisting on having made the right decisions ahead of the crisis, Wieland pointed out.
In his view, monetary policy had responded strongly during the crisis. However, in the meantime, Fed, ECB and other central banks were insisting much too long on their expansive monetary policy and the broadened central bank balance sheets. By using rules as the Taylor rule, which indicates the appropriate interest rate for a country, much would be achieved, Wieland is convinced.

Börsen-Zeitung: Volker Wieland im Interview: "Geldpolitik braucht eine stärkere Regelorientierung"
Börsen-Zeitung: "Wirtschaftsweiser fordert andere Geldpolitik"