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Dutch Central Bank Researcher, “Ordinary People Benefit From Price Stability”

1 Oct 2015, 00:00, ,

The reinvent.money conference recently hosted a range of speakers with a focus on the future of our monetary system. Head Researcher of the Dutch Central bank Jakob de Haan, discussed the need for price stability and tackled questions on bitcoin.

The reinvent.money conference was recently hosted in English at the Erasmus University in Rotterdam, the Netherlands. It was the successor to the event  ‘Geld voor de toekomst’ which took place last year, intending to bring together like-minded people to discuss the future of finance.

“So much is happening across Europe: monetary reform in Iceland, ongoing problems with the euro and Greece, never-ending banking scandals, the rise of bitcoin and the blockchain, peer-to-peer lending, crowdfunding and much more. A grand dialogue is required.”
— – reinvent.money

The speakers came from a range of backgrounds, including but certainly not limited to bitcoin. The bitcoin professionals consisted of Andreas Antonopoulos, a well-known bitcoin technologist and serial entrepreneur, Max Keiser, a presenter and co-founder of StartJoin, and Vit Jedlicka, the President of Liberland.

“Let’s reinvent money together.”
— – reinvent.money

Joining those with a background in bitcoin were legal counsels, professors and journalists. In addition to those speaking on monetary systems was Jakob de Haan who has been Head of Research for De Nederlandsche Bank, since 2009.

Haan was asked by the conference organizers to discuss his predictions regarding the future of central banking. In his speech Haan explained this would be incredibly difficult to do, likening it to predicting the gold market. However, with the thirty minutes allotted he took it upon himself to provide his insights about key issues in the central banking system.

Haan explained that central banks need to act more independently, and further transparency should be encouraged in order to maintain market stability. Haan added that his research shows central banks have evolved from extreme secrecy to a more transparent nature.

For example, the European Central Bank (ECB) states on their site the importance of independence from political influence: “Neither the ECB nor the national central banks (NCBs), nor any member of their decision-making bodies, are allowed to seek or take instructions from EU institutions or bodies, from any government of an EU Member State or from any other body”

“Transparency means that the central bank provides the general public and the markets with all relevant information on its strategy, assessments and policy decisions as well as its procedures in an open, clear and timely manner.”
— – ECB

During his speech, Haan described an environment where bankers are now asking the question, “can central banks be too transparent?” The proposed situation received some laughs from the audience,  “That’s the answer I guess,” he responded.

Transparency is a familiar topic in the bitcoin industry, and bitcoin enthusiasts challenged the central banking expert. An audience member queried whether the central banks are afraid of being replaced by decentralised technologies.

Haan admitted knowing little about bitcoin, although the central banks do have experts. He responded to the question lightheartedly by saying, “I’m not opposed to all these initiatives and if you’re right the world will be very different and I will lose my job, but by then I will be retired I guess.”

“You might think we are fundamentally opposed to these alternatives. We are not.”
— – Jakob de Haan

Haan further advised that bankers are keeping a close eye on emerging technologies, “but to be honest it’s so new and so many uncertainties are involved that it’s very hard to predict how the future will look like, there are many instruments that are currently under debate and sometimes already implemented but it’s a learning experience.”

Another audience member asked if it was the central banking system itself that is the structural problem with the finance system.

Haan’s response was that through his research and his current knowledge he does not see a free banking system working, as it has not done so in the past. He states that what he cares most about is a monetary system that works for every person that uses it.

"Ordinary people benefit from price stability and that is the most important mandate for most central banks."
— – Haan

In conclusion to the speech, Haan was thanked for taking the questions, “I know that this is not an easy crowd for central bankers, it’s a bunch of anarchists and activists, including myself,” said Paul Buitink who studied business administration at the Erasmus University and runs a podcast about monetary reform. Haan then laughed and said, “You should see my old pictures, in my young days.”


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