Thursday, April 13, 2006

Central Wankers

When central bankers are not politically independent, they can be enticed into behaving badly. But maybe the Kenya central bankers were just corrupt? From Division of Labour:

How can a corrupt central bank line the pockets of state-connected businessmen? A report from counts the ways the Kenya Central Bank has done it:

1. Printing extra cash for the government to disburse.
2. Sweetheart deals on (controlled) foreign exchange.
3. Sweetheart deals on government bonds.
4. Favoritism in bank supervision.
And they also have a post on Turkey's newly nominated CB leader. Who adheres to sharia, the Muslim law prohibiting the charging of interest. Pretty good idea to put someone like that in charge of interest rates.

Keywords: ECO301

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