The economic outlook: Oy vey. Stanley Fischer, the governor of the Israeli Central Bank, was interviewed by Institutional Investor. He thinks the world faces many problems:
“We have taken the major structural steps in terms of the various measures that have been proposed through the Basel Committee and through the Financial Stability Board to strengthen financial supervision and to strengthen the financial system.
“We still have not solved the process of systemically important financial institutions; we have not solved the problem how to deal with cross-border bankruptcy of larger institutions.
“There is a lot of work that still needs to be done. Then there are a number of countries where [it] got out of hand that have to get their fiscal situation back under control, both in Europe and the United States. Those are not small challenges. They are politically challenging and they are economically challenging.
“And there are the problems with currency and capital flow issues. “
Fischer, born in Zimbabwe, was an MIT professor and then worked both as Chief Economist of the World Bank and as Ist Deputy chairman at the International Monetary Fund, an unusual combination. He became an Israeli citizen in 2005 to become its CB head. He has just been named Central Banker of the Year by Euromoney.
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