Illusions bred by a reserve currency
Short-term US macroeconomic goals conflict with long-term interests of a world reliant on the dollar
Since the Bretton Woods system broke down in August 1971, economist Robert Mundell has convened periodic round-table meetings of economists, bankers, and officials to deliberate on the future of the international monetary system. The Santa Colomba Conference is named after the venue, a magnificent Renaissance villa situated on a crest in the rolling hills outside the city of Siena in Tuscany, which Mundell has called home since the late 1960s. I had the privilege of participating in this year’s recently concluded meetings and would like to share with the reader some of the insights that came out of the gathering.