by Neil Irwin
“Of course she is angry”: Veit Medick and Philipp Wittrock, “Weber’s Departure Undermines Merkel’s EU Clout,” Der Spiegel, February 11, 2011.
“Please, not this Italian!”: Quentin Peel, “Draghi Wins Over German Newspaper,” Financial Times, April 29, 2011.
“both come from orderly nations”: Hans-Jürgen Schlamp, “Europe’s Next Top Banker May Be Italian,” Der Speigel, February 23, 2011.
“at second glance it is clear”: Peel, “Draghi Wins Over German Newspaper.”
“He is very much in line with our ideas”: Stephen Castle and Jack Ewing, “Merkel Signals Support for Italian to Lead ECB,” New York Times, May 11, 2011.
“I will only say that we are responsible for ensuring price stability”: Trichet and Constancio, “Introductory statement.”
CHAPTER 17: THE PRESIDENT OF EUROPE
“We are dying”: Renee Maltezou, “Greek Police Clash with Anti-austerity Protesters,” Reuters, February 23, 2011.
“seriously damage faith in the functioning of the euro zone”: Christian Reiermann, “Greece Considers Exit from Euro Zone,” Der Spiegel, May 7, 2011.
“We had Wall Street open at that point in time”: Charles Forelle, “Luxembourg Lies on Secret Meeting,” Real Time Brussels (blog), Wall Street Journal, May 9, 2011, http://blogs.wsj.com/brussels/2011/05/09/luxembourg-lies-on-secret-meeting/.
At 12:06 p.m. on Saturday, May 14: Christopher Dickey and John Solomon, “The Strauss-Kahn Timeline,” Newsweek, July 24, 2011.
At 4:40 p.m., Port Authority police: Dan Bilefsky, “The French Reaction to IMF Chief’s Arrest,” Lede (blog), New York Times, May 15, 2011, http://thelede.blogs.nytimes.com/2011/05/15/the-french-reaction-to-i-m-f-chiefs-arrest/.
Strauss-Kahn’s sexual appetites had gotten him in trouble three years earlier: Landon Thomas Jr., “Woman in 2008 Affair Is Said to Have Accused IMF Director of Coercing Her,” New York Times, May 16, 2011.
“The view that seems to be taking hold”: George Georgiopoulos and Harry Papachristou, “IMF Says Greece Must ‘Reinvigorate’ Reform Drive,” Reuters, May 18, 2011.
Papandreou was particularly proud of his strategy of using Google Earth: Daniel Steinvorth, “Greek Government Hauls Billions in Back Taxes,” Der Spiegel, August 2, 2010, http://www.spiegel.de/international/europe/.
“To this demonstrably mistaken recipe I will not agree”: Elena Becatoros, “Greek Opposition Party Rejects New Austerity Plan,” Associated Press, May 24, 2011.
“I didn’t come to discuss the looting of Greek society”: Ibid.
“We will all require assurances”: Stephen Castle, “IMF Gets Tough with Europe; Aid to Greece Withheld for Now,” International Herald Tribune, June 21, 2011, 3.
In Syntagma Square: Renee Maltezou and Harry Papachristou, “Greek Police Battle Rioters as Austerity Bill Passed,” Reuters, June 29, 2011.
“We are not in favor of restructuring and haircuts”: Jean-Claude Trichet, press conference, European Central Bank, Frankfurt, Germany, June 9, 2011, http://www.ecb.int/press/pressconf/2011/html/is110609.en.html.
“a sovereign default or disorderly bank failures”: Antonio Borges and Aasim Husain, “IMF Country Report No. 11/184,” working paper, Staff Report for the 2011 Article IV Consultation with Member Countries, European Department, Washington, DC, July 1, 2011, http://www.imf.org/external/pubs/ft/scr/2011/cr11184.pdf.
“Any talk of restructuring was a total taboo”: Landon Thomas Jr. and Stephen Castle, “The Denials That Trapped Greece,” New York Times, November 5, 2011.
“There was shock and surprise on their faces”: Thomas Jr., 2011.
At about 1 a.m., Trichet, Merkel, and Sarkozy called Brussels: Carlo Bastasin, Saving Europe: How National Politics Nearly Destroyed the Euro (Washington, DC: Brookings Institution Press, 2012), 294.
“banker war room”: Klaus C. Engelen, “Ackermann’s Banker War Room,” International Economy Summer (2011): 62.
“With this offer”: “Greece Financing Offer: Statement by IIF Board of Directors,” official statement, Institute of International Finance, Brussels, Belgium, July 21, 2011, http://www.iif.com/press/press+198.php.
According to calculations by economist and journalist Carlo Bastasin: Bastasin, Saving Europe, 287.
“The full liberalisation of local public services”: “Trichet e Draghi: un’azione pressante per ristabilire la fiducia degli investitori,” Corriere della Sera, September 29, 2011, http://www.corriere.it/economia/11_settembre_29/.
the Governing Council met again on the afternoon of Sunday, August 7: Peter Müller et al., “Breaking Taboos: Concerns Mount in Germany over ECB Bond Buys,” Der Spiegel, August 15, 2011.
“Our hearts pour with blood”: Giulia Segreti, “Rome Orders €45 Billion in Cuts and Taxes,” Financial Times, August 12, 2011.
“Here’s the real problem with Italy”: Anthony Faiola, “Amid Crisis, Italy Confronts a Culture of Tax Evasion,” Washington Post, November 24, 2011.
as the ECB bought: European Central Bank Press Release Database, bond purchase data, http://www.ecb.int/press/.
“Who do I call if I want to call Europe?”: Vanessa Gera, “Kissinger Says Calling Europe Quote Not Likely His,” Associated Press, June 27, 2012.
“Trichet has become the de facto president of Europe”: Jeff Black and Jana Randow, “Trichet Turns ‘President of Europe’ as Debt Crisis Stuns Political Leaders,” Bloomberg News, August 9, 2011.
“for personal reasons”: “Jürgen Stark resigns from his position,” ECB Press release, European Central Bank, Frankfurt, Germany, September 9, 2011, http://www.ecb.int/press/pr/date/2011/html/pr110909.en.html.
“It’s a very bad sign”: Jack Ewing and Nicholas Kulish, “Key German Resigns from Leadership of ECB,” International Herald Tribune, September 10, 2011, 14.
“The Executive Board of the ECB”: Helmut Schmidt, “Farewell event for Jean-Claude Trichet,” speech, European Central Bank, Frankfurt, Germany, October 19, 2011, http://www.ecb.int/events/shared/pdf/speech_schmidt_111019_en.pdf?9e56ea646c3197e7a7b08fa78e70a276.
“The single currency is an ancient idea”: Jean-Claude Trichet, speech, European Central Bank, Frankfurt, Germany, October 19, 2011, http://www.ecb.int/press/key/date/2011/html/sp111019.en.html.
They called themselves the Groupe de Francfort: “A Crisis? Call the F-Team,” Economist, November 4, 2011.
CHAPTER 18: ESCAPE VELOCITY
“I find the activism at the Fed right now a major turnoff”: Senate Committee on Banking, Housing, and Urban Affairs, transcript of hearing, July 14, 2011, CQ Transcriptions.
“I would fire him tomorrow”: Transcript of September 7, 2011, debate of Republican Presidential Candidates at Ronald Reagan Presidential Libary, Federal News Service.
“The euro-area crisis has had more dramatic moments”: Speech by Mervyn King at the Mansion House, June 14, 2012, http://www.bankofengland.co.uk/publications/Documents/speeches/2012/speech587.pdf.
“The fact that we’re not in the euro area”: Mervyn King, Quarterly Inflation Report Q&A, May 16, 2012, http://www.bankofengland.co.uk/publications/Documents/inflationreport/conf120516.pdf.
King was in the royal box: Matt Sandy and Amanda Perthen, “Crisis? What Crisis,” Mail on Sunday, July 3, 2011.
“the reason we would raise interest rates”: Sean O’Grady, “No Interest Rate Rise before Unemployment Falls, Says King,” Independent (London), June 29, 2011.
“almost impossible to calibrate”: Bank of England Inflation Report, August 2011, 38, http://www.bankofengland.co.uk/publications/Documents/inflationreport/ir11aug.pdf.
“The big risks facing the UK economy”: Mervyn King, Inflation Report Press Conference, Opening Remarks by the Governor, August 10, 2011, http://www.bankofengland.co.uk/publications/Documents/inflationreport/irspnote100811.pdf.
“We were very conscious”: Examinati
on of Witnesses, Treasury Select Committee, http://www.publications.parliament.uk/pa/cm201012/cmselect/cmtreasy/1576/11102502.htm.
“shock and awe”: Philip Aldrick, “Shock and Awe Could Be QE’s Biggest Asset,” Daily Telegraph, October 7, 2011.
“The world economy has slowed”: Allistair Osborne, “Bank Pins Hopes on QE2 to Keep Economy Afloat,” Daily Telegraph, October 7, 2011.
“Suppose we faced a very different economic environment”: “The Fed’s Dual Mandate Responsibilities and Challenges Facing U.S. Monetary Policy,” September 7, 2011, http://www.chicagofed.org/webpages/publications/speeches/2011/09_07_dual_mandate.cfm.
“Desperate times call for bold measures”: Christina D. Romer, “Dear Ben: It’s Time for a Volcker Moment,” New York Times, October 30, 2011, 6.
“Is it frustrating”: Bank of England Quarterly Inflation Report Q&A, May 16, 2012, http://www.bankofengland.co.uk/publications/Documents/inflationreport/conf120516.pdf.
CHAPTER 19: SUPER MARIO WORLD
“Mario Draghi’s first day at work”: “George Papandreou: An All Too Final Stand,” Guardian, November 1, 2011, http://www.guardian.co.uk/commentisfree/2011/nov/01/george-papandreou-final-stand-editorial.
“the political equivalent of smashing rare and expensive plates”: Joshua Chaffin and Quentin Peel, “Papandreou’s Gambit Sparks Eurozone Alarm,” Financial Times, November 2, 2011.
“The referendum in essence is about nothing else”: Stefan Simons, “Merkel and Sarkozy Halt Payments to Athens,” Der Spiegel, November 3, 2011.
“We made Papandreou . . . aware”: Ibid.
“It amounted to the final stage of the ‘waterboarding’ sessions”: Carlo Bastasin, Saving Europe: How National Politics Nearly Destroyed the Euro (Washington, DC: Brookings Institution Press, 2012), 338.
In the week ending November 11: Derived by the author from weekly ECB balance sheet announcements at http://www.ecb.int/press/pr/wfs/2011/html/index.en.html.
They served white wine from the Pfalz region: Ralph Atkins, “Eurozone Crisis: A Deft Way to Buy Time,” Financial Times, February 7, 2012.
“coordinated actions to enhance their capacity”: Federal Reserve Press Release, November 30, 2011, http://www.federalreserve.gov/newsevents/press/monetary/20111130a.htm.
“Finally, global action!”: Kevin Carmichael, “Central Banks in Bid to Pull Europe from Doldrums,” Globe and Mail, December 1, 2011, B1.
“it was a lively discussion”: Mario Draghi, press conference December 8, 2011, http://www.ecb.int/press/pressconf/2011/html/is111208.en.html.
“It felt like war”: Niki Kitsantonis and Rachel Donadio, “Athens Shaken by Riots after Vote for Austerity,” New York Times, February 14, 2012, A8.
One Greek newspaper: “‘Memorandum Macht Frei’: How One Greek Paper Views the Second Bailout,” Journal, http://www.thejournal.ie/memorandum-macht-frei-how-one-greek-paper-views-the-second-bailout-351455-Feb2012/.
“must undertake determined policy actions”: Hearing at Committee on Economic and Monetary Affairs of the European Parliament, introductory statement by Mario Draghi, April 25, 2012, http://www.ecb.int/press/key/date/2012/html/sp120425.en.html.
“The euro is like a bumblebee”: Speech by Mario Draghi, Global Investment Conference, London, July 26, 2012, http://www.ecb.int/press/key/date/2012/html/sp120726.en.html.
CHAPTER 20: GOVERNOR ZHOU’S CHINESE MEDICINE
“A drug from Western medicine”: Speech by Zhou Xiaochuan at Caixin Summit, November 5, 2010, official English translation at http://www.pbc.gov.cn:8080/publish/english/955/2010/20101228160916958752023/20101228160916958752023_.html. Author’s translation differs from official translation. Original Chinese at http://www.pbc.gov.cn/publish/hanglingdao/2950/2010/20101119164544386735148/20101119164544386735148_.html.
Forbes listed Zhou as number fifteen: Nicole Perlroth and Michael Noer, “The World’s Most Powerful People,” Forbes, November 2, 2011, http://www.forbes.com/powerful-people/.
Foreign Policy placed him number four: “The FP Top 100 Global Thinkers,” Foreign Policy, December 2010.
In August 2010, there was a strange rumor circulating: Jason Dean, “Markets Ignore China Rumor (for a Change),” China Realtime Report (blog), Wall Street Journal, August 31, 2010, http://blogs.wsj.com/chinarealtime/2010/08/31/markets-ignore-china-rumor-for-a-change/.
“They had a red rubber stamp”: “Carl Walter and Victor Shih on the Chinese Banking System,” Gerson Lehrman Group High Table Video, May 21, 2012, https://www.hightable.com/china/video/video-carl-walter-victor-shih-chinese-banking-pt-1.
“From other countries we’ve already learned this lesson”: 21st Century Business Herald, March 6, 2009, http://www.21cbh.com/HTML/2009-3-9/HTML_5DFC2OOESWSQ.html.
“astronomical lending” . . . “masking catastrophe”: Ru Guo, [“Wu Xiaoling: Astronomical loans mask catastrophe, central bank must return to hedging measures”], July 23, 2009.
“Besides laboring . . . I was exposed to other things”: Chenjing Xu, [“Zhou Xiaochuan: We can’t let the common people’s money become frayed”], [Global People Magazine], November 30, 2010, http://people.huanqiu.com/Exclusive/2010-11/1303775_5.html.
“In a complicated system, there are usually many feedback loops”: Zhou Xiaochuan, “Changing pro-cycliclality for financial and economic stability,” March 26, 2009, http://www.bis.org/review/r090421b.pdf.
“old-style Maoists”: David Barboza, “China’s Mr. Wu Keeps Talking,” New York Times, September 26, 2009, http://www.nytimes.com/2009/09/27/business/global/27spy.html?_r=1&pagewanted=all.
“Whatever the market can solve”: Chenjing Xu [“We can’t let the common people’s money become frayed.”]
In a doubles match against . . . Larry Summers: Bob Davis, “Political Overlords Shackle China’s Monetary Mandarins,” Wall Street Journal, April 15, 2011, A1.
China’s bond market is breathtakingly underdeveloped: Henry Sanderson, “China Bond Market Ready for Takeoff after Bold Moves,” Bloomberg News, June 11, 2012.
“kind of international reserve currency we need: Zhou Xiaochuan. “Reform the International Monetary System,” March 23, 2009, http://www.pbc.gov.cn/publish/english/956/2009/20091229104425550619706/20091229104425550619706_.html.
In October 2009, the PBOC created a new department: Tao Li [“PBOC confirms the establishment of a second monetary policy division”], Caixin Media, October 30, 2009, http://www.caijing.com.cn/2009-10-30/110299012.html.
“The main purposes of the swap agreement”: “Bilateral Local Currency Swap Arrangement with the People’s Bank of China,” Reserve Bank of Australia, March 22, 2012, http://www.rba.gov.au/media-releases/2012/mr-12-08.html.
In official documents, the phrase used: http://www.fx168.com/fx168html/20120514/20120514134396080.htm; http://www.chinascopefinancial.com/news/post/11212.html.
“the will of the market”: “RMB internationalization is market’s choice,” China Daily, June 5, 2012, http://www.china.org.cn/business/2012-06/05/content_25566200.htm.
“If some areas need to be reformed”: “Reform Is a Big Systematic Transformation and Needs Reasonable Arrangements,” Emerging Markets Insight, Mirae Asset, July/August 2012.
“trickery”: Peng Yi [“How did Zhou Xiaochuan become a trickster with the interest rate hike”], Economic Observer, October 21, 2010, http://www.eeo.com.cn/2010/1021/183192.shtml
AFTERWORD: BACK TO JACKSON
“What about the commercial-paper market?”: “Tangled Reins,” Economist, September 6, 2007. http://www.economist.com/node/9767718.
“The results that we have do not imply”: Michael Woodford, “Methods of Policy Accommodation at the Interest-Rate Lower Bound,” paper presented at the Jackson Hole Symposium “The Changing Policy Landscape,” August 31, 2012, http://www.kansascityfed.org/publicat/sympos/2012/mw.pdf?sm=jh083112-4.
“I never plan my holidays ahead”
: Mario Draghi, interview with Le Monde, July 21, 2012, http://www.ecb.int/press/key/date/2012/html/sp120721.en.html.
“This is a political problem”: Brian Blackstone and Marcus Walker, “How ECB Chief Outflanked German Foe in Fight for Euro,” Wall Street Journal, October 2, 2012, A1.
At a dinner on August 1: Paul Carrel, Noah Barkin, and Annika Breidthardt, “Special Report: Inside Mario Draghi’s Euro Rescue Plan,” Reuters, September 25, 2012.
“has been stretched and, in some cases, disregarded”: “Too Close to State Financing via the Money Press,’” Der Spiegel, August 29, 2012, http://www.spiegel.de/international/europe/spiegel-interview-with-bundesbank-president-jens-weidmann-a-852285.html.
“Mephistopheles stirs up the general elation even further”: “Money Creation and Responsibility,” speech at the 18th colloquium of the Institute for Bank-Historical Research (IBF) in Frankfurt, September 18, 2012, http://www.bundesbank.de/Redaktion/EN/Reden/2012/2012_09_20_weidmann_money_creaktion_and_responsibility.html.
“I think that, in my job as president”: Mario Draghi, press conference, September 6, 2012, http://www.ecb.int/press/pressconf/2012/html/is120906.en.html.
“this precious stone set in the silver sea”: Mervyn King, Speech to the South Wales Chamber of Commerce, October 23, 2012, http://www.bankofengland.co.uk/publications/Documents/speeches/2012/speech613.pdf.
“Is not the mere existence of general unemployment”: Mervyn King “Twenty Years of Inflation Targeting,” Stamp Memorial Lecture, London School of Economics, October 9, 2012, http://www.bankofengland.co.uk/publications/Documents/speeches/2012/speech606.pdf.
IMAGE CREDITS
1: Kungl. Myntkabinettet (The Royal Coin Cabinet)
2: Hulton Archive/Getty Images.
3: AP Photo/Staff/Putnam
4: Bettmann/Corbis/AP Images
5: AP Photo/Chick Harrity
6: © European Commission Audiovisual Library
7: Bloomberg/Getty Images
8: © Bank for International Settlements
