"Unless there is a disaster in the Europe and the US is all right, we can emerge from 2012 with the average growth rate of the past 30 years," Governor of the Bank of Israel Prof. Stanley Fischer said in an interview with “IDF Radio" (Galei Zahal) today.
"The euro bloc will ultimately not break up, and its current member states will remain," he said. "The euro will survive, and it will probably survive will all its current member states." He added that, during the year, he though, "The Europeans were prepared to let a country or two quit the euro, but then realized the repercussions, and decided to try and save the bloc as is."
Fischer discussed the "bazooka" waiting the markets - the European Central Bank's bond purchasing program. "The Germans learned one thing about inflation, which gave the world Hitler - they learned that central banks must not buy government bonds. What should a central bank do today? Buy government bonds. All the Germans knew that this was wrong. Chancellor Angela Merkel sought a solution, and it takes time, but they've been making rapid progress in the past two months."
As for Israel's social protest, Fischer said, "These events will not be easily forgotten; they are there, and that's one of the achievements. They raised everybody's awareness about the problems that they were demonstrating against. The demonstrators chalked up a success in public awareness and in policy. I assume that there will be more achievements, but they can't get everything."
Fischer said that he was hurt by his rejection to lead the IMF, saying, "I knew in advance that the likelihood was low."
Published by Globes [online], Israel business news - www.globes-online.com - on December 29, 2011
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