Not All Central Banks Are Created Equal

摘要

Following the failure of the Lehman Brothers investment bank and the global financial market crisis, the central banks of the United States, Japan, and the euro area launched several conventional and unconventional monetary policy measures in order to stabilize the financial system and cushion the severe economic slump. They not only reduced interest rates to all-time lows but also pumped massive amounts of liquidity into the financial markets. This caused their balance sheets to expand considerably. The array of instruments used by these central banks included full allotment in refinancing operations or purchasing assets directly in the financial markets. With regard to nominal balance sheet expansion, it can be seen that the balance sheets of the Federal Reserve System and the Bank of England expanded to about five times their size prior to the financial crisis. The Eurosystem's consolidated balance sheet hit an all-time high following allotment of the second 36-month tender at the end of February 2012. Since the Eurosystem's balance sheet "only" doubled in size, this led to accusations that euro area central banks were not doing enough to fight the consequences of the financial and sovereign debt crisis and the economic downturn.