The Approach to Macroeconomic Management: How it Has Evolved

Per Jacobsson lecture by Lord George - Basel, 29 June 2008

I am greatly honoured to have been summoned out of retirement to deliver this Per Jacobsson Lecture, and I am delighted to do so. Per Jacobsson was an outstanding international public servant. He joined the BIS from its beginning in 1931 as Head of the Monetary and Economic Department and played a massive role in laying the foundations of the outstanding international central banking organisation that it is today. He went on to become Managing Director and Chairman of the Executive Board of the IMF in 1956 until his death in 1963. It is very appropriate that we should commemorate his great contribution to the international economic and financial system through this series of lectures.

I'd like to begin my remarks this morning by reflecting upon my own experience of the truly fundamental changes that have occurred - in the UK, but from different starting points and to varying degrees around the world - in our whole approach to macroeconomic management over the course of my own 40-odd year career at the Bank of England. Against that background I will go on to discuss the recent turbulence in global financial markets and offer some thoughts on the implications for financial regulation looking ahead.