ABSTRACT
To do a good job, central bankers ought to have more to rely on than luck and their reputations. They need some formal independence, to make them one of the checks and balances against the accumulation of power by central government. They need, in short, to be like judges – not above the law, but administering it. In this case, their brief would be to aim for stable prices, a goal that every wise parliament would set for them. That is society’s true bulwark against the arbitrary cheating of inflation, and the chaos of hyperinflation. It ought to be the next big challenge for democracies.
