The SAFE Policy Center organizes and cordially invites you to attend a panel discussion on
Shouldn’t We All Have a Central Bank Account?
Markus Brunnermeier, Princeton University
Benoît Cœuré, Bank for International Settlements
Moderator: Hans-Helmut Kotz, SAFE and Harvard University
9 June 2021, 18:30 to 19:45 CET via Zoom
Watch the video on our Youtube channel
More than 90% of the money we use for payments is created by commercial banks, by way of issuing deposits. Only monetary financial institutions – wholesalers – enjoy a direct access to Central Banks. In fact, in many jurisdictions MFIs are obliged to hold such reserves, they are obligatory, though meanwhile typically remunerated. Commercial banks use these accounts as working balances. Ever since monetary easing programs have been launched, they also hoard excess liquidity there. Except for their own employees, Central Banks, however, do not offer checking accounts to retail clients – until today. The financial environment is however changing rapidly. Denationalized private digital currencies (of sorts) are emerging. And plans for privately issued, asset-backed media of payments exist. What speaks in favor of Central Banks issuing digital currencies, in addition to analog cash? What are the benefits, what are potential costs? Which ramifications could arise for commercial banks, for example? Are macro-financial risks involved?
Benoît Cœuré, Head of the Bank for International Settlements’ Innovation Hub, is charged to address and internationally coordinate, inter alia, whether and how central banks should provide digital currencies, also in the retail domain. As a former Member of the Executive Board of the ECB and Head of the BIS Committee on Payments and Market Infrastructures, he has a long-standing experience in monetary and stability issues. He is also, inter alia, co-author of a textbook on Political Economics, just out in its 5th edition.
Markus Brunnermeier, one of the most renowned and most prolific academic economists in the field of monetary and financial issues, is Edwards S. Sanford Professor as well as the director of the Bendheim Center for Finance, both at Princeton University. He is about to finish a book on societal resilience and also affiliated, among others, with the NBER, the CEPR, the Bundesbank and the U.S. Congressional Budget Office.
The policy web panel is a part of the SAFE Policy Lecture Series aiming at fostering debates on policy-relevant issues.