Final Word from Wednesday, January 29, 2020

For two years before the CNB devalued the crown on Nov. 7, 2013, Vice Gov. Mojmír Hampl criticized central bankers for flooding the market with new money. He said in Týden on June 27, 2011, that it was like flipping the nuclear switch. Coincidently, that interview was led by Lukáš Kovanda, who is now chief economist of DRFG's Czech Fund. After the newly released minutes of the Nov. 2013 CNB meeting confirmed this week that Hampl's vote was the one that made the devaluation possible, Kovanda wrote that within one month Hampl had "torn up the very foundations of his way of economic thinking" and that we can only ask why. The obvious answer needn't be the correct one. Sure, Czech oligarchs and others in the top 0.1% have especially benefited from the flood of money, but so have central bankers in general. They now rule the world, and there is no fighting the destruction they are sowing. Only by flipping the nuclear switch did Hampl truly become one of them. [ Czech Republic devaluation Czech National Bank ]