‘Money-printing spree has turned banks into drug addicts’
“Waves of money printing have turned banks into ‘drug addicts’ reliant on cheap cash to stay afloat, one of the world’s top central bankers has warned. Raghuram Rajan, who was once a contender to lead the Bank of England, said repeated rounds of quantitative easing (QE) had encouraged lenders to take bigger risks in search of returns that are disappearing in the world of higher interest rates.”
USAGOLD note: Rajan was one of the few mainstream economists to foresee the 2008 financial crisis. He says the banking crisis is far from over.
“My prescription has always been ‘don’t try to do too much’. Don’t think you have these magnificent weapons which will deal with all problems. And don’t think that you can solve every one of society’s problems. Because the more you claim to be superhuman, the more people will expect. And the harder the fall will be when they find out you really can’t fix them.” – Raghuram Rajan, former Governor, Reserve Bank of India