The Duck of Minerva

The Duck Quacks at Twilight

The end of the era of central bankers?

March 6, 2009


If I were to speculate on what circumstances might lead to a significant curtailment of central bank autonomy in the United States, I imagine I would come up with a scenario that looks something like this one. If Josh Marshall’s informant is right, it might be pitchfork time for the Federal Reserve:

Josh, your reporting on the AIG credit default swap/counterparties issue has been spot-on. But to understand what happened there, you have to understand the Fed’s “Maiden Lane” vehicles and how it’s used them to avoid what Congress intended with TARP, which was the real story that came out of Dodd’s hearing on the AIG mess today. And the roots of it go back to the Bear Stearns rescue last year.

Image source: https://www.finestprospect.org.uk/Mediaeval/Med.htm

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Daniel H. Nexon is a Professor at Georgetown University, with a joint appointment in the Department of Government and the School of Foreign Service. His academic work focuses on international-relations theory, power politics, empires and hegemony, and international order. He has also written on the relationship between popular culture and world politics.