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The Bank of England has imported its next governor. Mark Carney, 47, currently the head of Canada’s central bank, will take over from Sir Mervyn King on July 1. the BoE’s release is at pains to point out that “as a Canadian citizen he is a subject of Her Majesty The Queen”; it also mentions that he used to work for Goldman Sachs — just like ECB chief Mario Draghi, Italy’s Mario Monti, and William Dudley of the New York Fed.
This appointment marks a new breed of central banker, Neil Irwin writes. Unlike King or Ben Bernanke, both academic economists, Carney’s schooled in the “messy, legalistic world of overseeing banks and financial markets”. This will be particularly important because the BoE will soon resume bank oversight.
What will Carney’s term as the head of BoE be like? For one, count on the push for higher bank capital standards to continue. In this Reader’s Digest Canada interview, Carney said Canada made it through the financial crisis because “our banks had more capital than most banks around the world”.
You can also expect Carney to speak his mind: his dictum is “complacency is really the enemy in finance”, which helps explain his repeated warnings to Canadians that low rates could fuel a housing bubble.
Carney’s approach, according to this 6,000-word Euromoney profile from October, has been reformist, but not radically so. Carney was willing to spar with Jamie Dimon over capital requirements, but he isn’t necessarily a fan of breaking up big banks and he has criticized the Volcker Rule. He’s described as “finance’s new statesman”, but he also has a “zeal for regulation and government supervision”.
Martin Wolf writes that Carney will need that love of government — he’s entering a job that’s “inescapably political”. — Ryan McCarthy
On to today’s links:
It’s time for a minimum tax on the wealthy – Warren Buffett
The latest solution to America’s Congressional budget dysfunction? Tim Geithner – WSJ
The White House’s new report on how the fiscal cliff will affect the middle class – White House