Blanchflower: Central Bankers Serve the Will of the People

The video discusses the role of the Federal Reserve in the context of Trump's trade war, questioning whether the Fed should influence political decisions. It highlights the debate on central bank independence and whether they should bail out politicians. The discussion also covers past mistakes by the Fed, such as failing to recognize a recession in 2008 and credibility issues due to rate rises. The video concludes by questioning if the Fed is still the best alternative for economic management.

What is the main concern of the former New York Fed president regarding the Fed's actions?

• Increasing inflation rates

• Encouraging aggressive trade policies

• Decreasing employment rates

• Strengthening the US dollar

What is a key argument against central banks considering political factors in their decisions?

• Central banks should always oppose government policies

• Political factors are irrelevant to economic stability

• Central banks serve at the will of the people

• Central banks should focus on short-term goals

What is one of the roles of the Central Bank according to the second section?

• To support political agendas

• To manage short-term economic fluctuations

• To increase government revenue

• To take a long-term view of the economy

What past error of the Fed is highlighted in the third section?

• Overestimating employment growth

• Underestimating the impact of trade policies

• Not recognizing a recession in time

• Failing to predict inflation

What is questioned about the Fed's performance over the last decade?

• Its credibility and effectiveness

• Its ability to control inflation

• Its independence from political influence

• Its support for international trade