My TakePublic money we don’t talk about, let alone spend
- Hong Kong’s de facto central bank keeps getting richer all in the name of preserving the US dollar peg, so forget about any discussion of using just some of it anywhere else
Hong Kong’s de facto central banker, Norman Chan Tak-lam, is set to retire in September. Naturally, the first question people ask is: who will be the new boss? Another question is: did Chan do a good job?
Maybe people will again argue about the wisdom of hanging onto the US dollar peg, now almost four decades old.
But I submit that none of these questions really matter to ordinary folks such as you and me, and that the only question that matters to us is: how much reserves are needed to support the peg?
Powerful people already know who the next boss is, but the government is going through the motion of launching a selection panel for “candidates”.
Hong Kong’s monetary chief Norman Chan to retire in September
Since a currency board is by definition automatic, it’s hard to know whether Chan has done a good job. But he deserves credit for tightening bank mortgage requirements. They failed to cool the property market, but at least lessened local banks’ exposure.
The beauty of a currency board is that we don’t need bureaucrats in charge who look at their computer screens all day, their moods changing according to the ups and downs of the latest financial data, and moving interest rates on a whim.