Last updated: June 25, 2007 5:18 pm
............................................................................................................................................
Is there a need for a global central bank after the increased liquidity (money) in the marked? How will the relatively new instruments like CDO, CLO and CDS, manage true a bearish market, will the models that they are based on work in the real world?
Lise Andersen, Stockholm
Martin Wolf: We would need a global central bank only if we had one world currency. We do not now have such a currency and are unlikely to do so for a very long time. The answer to your question about CDOs etc is ”I have no idea”. I imagine there will be defaults on some of them. Of course, that is what happens in a sufficiently bearish market.
No comments:
Post a Comment