• Sweden's news in English
 

'We're not Japan': Swedish Riksbank

Published: 29 Apr 2014 21:03 GMT+02:00

The Nobel Prize-winning economist took to his New York Times column last week to explain why he thought Sweden had gone from "role model" and "rock star" to making policy dominated by "sadomonetarists".

The issue at stake was the Riksbank's decision in 2010 to raise the repo rate at what Krugman considered to be the wrong time.

"Sadomonetarism is an attitude, common among monetary officials and commentators, that involves a visceral dislike for low interest rates and easy money, even when unemployment is high and inflation is low," he wrote.

The Swedish Riksbank's Governing Board Chairman Johan Gernandt said he did not accept that description.

"Not at all," he told The Local on Tuesday. "I think it's an unfair statement just to make headlines."

Gernandt and the Riksbank Governing Board Vice Chairman Sven-Erik Österberg penned a reply to Krugman that was published by the New York Times on Monday.

"We object to Paul Krugman’s claim that as a consequence of monetary policy mistakes, Sweden has been caught in a spiral of stagnation and deflation and thus 'turned itself into Japan'," they wrote.

Why respond to Krugman in the first place?

"We were of the firm opinion that he was not fair in his criticism, that his choice of words was not justified, and that he was actually misleading his audience," Gernandt told The Local on Tuesday. "Regretfully, the number of words we were allowed to use in the New York Times was very limited, but we hope the message has been delivered."

The duo's letter explained that the Swedish economy was actually doing rather well.

"Swedish gross domestic product growth in the aftermath of the crisis has been strong, increasing 1.5 percent during 2013 (and by 3.1 percent in the fourth quarter)," they pointed out. "Paired with a continuing increase in employment, this can, in our view, hardly be described as a stagnating economy."

Gernandt said it was "quite rare" that he and Österberg together would weigh in on public debate.

"In our opinion, this (letter) was necessary for an international audience to point out that the Swedish economy stands strong," he told The Local. "It's one of the strongest countries in Europe as a matter of fact."

Ann Törnkvist (ann.tornkvist@thelocal.com)

Your comments about this article

Today's headlines
Sony ditches streaming service for Spotify
Swedens most famous start-up is gaining rapid momentum. Photo: TT

Sony ditches streaming service for Spotify

Swedish music streamer Spotify will provide the soundtrack for Sony devices, the two companies have announced, spelling the end to the streaming music service from the Japanese tech giant that invented the Walkman. READ  

Integration now second biggest voter issue
A mosque in Stockholm. Photo: TT

Integration now second biggest voter issue

Education is the top issue for Swedish voters, with integration coming second, in a new poll which also suggests growing concerns about rising Islamophobia and anti-Semitism in Sweden. READ  

Sweden wins bronze at food 'World Cup'
Tommy Myllymäki from Sweden came third in the contest. Photo: TT

Sweden wins bronze at food 'World Cup'

The world's most prestigious food competition, Bocuse d'Or, has wrapped up in Lyon, France, with a top Swedish chef scooping a bronze and a Norwegian talent taking the crown. READ  

What's on in Sweden
What’s on: January 31st - February 7th
Jokkmokk Market is set to draw in the crowds this week. Photo: TT

What’s on: January 31st - February 7th

Gothenburg's Film Festival is underway, the Swedish capital has got its skates on as it hosts the European figure skating championships for the first time in decades, while Jokkmokk in northern Sweden is stepping back in time. READ  

'Nazi' question lands broadcaster in hot water
Crown Princess Victoria in Poland on Tuesday. Photo: TT

'Nazi' question lands broadcaster in hot water

Sweden's public broadcaster SVT was facing a backlash on social media on Wednesday after a reporter asked Crown Princess Victoria about her family's history during her visit to the Auschwitz concentration camp in Poland. READ  

The Local List
Ten ways talking in English baffles Swedes
A Viking - sometimes pronounced 'Wiking', in Sweden. Photo: Shutterstock

Ten ways talking in English baffles Swedes

While Swedes are among the world's best English speakers, there are a few common - and often charming - mistakes The Local's team has spotted while chatting to Swedes in their second language (because yes, of course, it is still better than our Swedish). READ  

Arrest over Swedish journalist's Kabul murder
A Stockholm press conference last March on Nils Horner's murder. Photo: TT

Arrest over Swedish journalist's Kabul murder

A suspect has been arrested for the murder of popular Swedish-British national radio journalist Nils Horner last year in Kabul, but in Sweden many questions about the case remain unanswered. READ  

Huge cuts at Gothenburg ball bearing plant
SKF headquarters in Gothenburg. Photo: TT

Huge cuts at Gothenburg ball bearing plant

The world's biggest producer of ball bearings SKF announced massive job cuts on Wednesday even though its net profits soared fivefold in 2014. READ  

Fashion giant H&M to grow as profits soar
H&M's profits are growing. Photo: TT

Fashion giant H&M to grow as profits soar

Swedish fashion giant H&M has announced that its profits for 2014 rose by almost a fifth and pledged to speed up its global expansion. READ  

Swedish drug users ‘need’ syringe exchanges
A needle exchange centre in Malmö. Photo: TT

Swedish drug users ‘need’ syringe exchanges

Needle and syringe exchange programmes should be introduced across the country, to reduce the growing risk of hepatitis C, Sweden’s Public Health Agency (Folkhälsomyndigheten) writes in a new report. READ  

RECEIVE OUR NEWSLETTER AND ALERTS
National
Does Sweden help returning Isis fighters more than Swedish veterans?
Gallery
IN PICTURES: January snow snaps
Society
Is Sweden's healthcare system a national embarassment?
Business & Money
FATCA: 'The age of financial privacy is over'
Gallery
Property of the week: Skanör, Vellinge
Blog updates

26 January

The mysterious -s, part 1 (The Swedish Teacher) »

"Hej! How is your Swedish coming along? A while ago I read on a forum on The..." READ »

 

23 January

Editor’s blog, January 23rd (The Local Sweden) »

"Happy Friday from The Local’s team in Stockholm. We can’t wait for the weekend, when we’re planning..." READ »

 
 
 
National
Why Sweden's Left party wants a European 'Red Spring'
Lifestyle
'Life as a Swedish candy-maker is sweet'
Gallery
IN PICTURES: Sweden's hottest new fashion designers for 2015
Gallery
IN PICTURES: Who travels on Stockholm's different subway lines?
Lifestyle
Why this Swedish baby is a US hit
Lifestyle
'Limousine' snowplough for sale
People-watching: January 24th - 25th
Gallery
People-watching: January 24th - 25th
Society
Meet the 'beggars' buttoning up immigration critics
Lifestyle
What's on in Sweden this week
Gallery
IN PICTURES: Princess Madeleine through the years
Features
Learn Sweden's bizarre dating lingo
People-watching: January 21st - 22nd
Gallery
People-watching: January 21st - 22nd
Society
Why Sweden's viral 'genital' video is getting an English remake
National
Why does Sweden's Luleå have a giant ice beaver?
Gallery
IN PICTURES: Who are Sweden's richest one percent?
Business & Money
How a classic Swedish snack got a revamp for 'busy' Stockholmers
Lifestyle
The Local's top Swedish acts for 2015
Gallery
IN PICTURES: Sweden's Årets Bild photography prize winners
Business & Money
'I met my Swedish man in Tokyo's first Ikea store'
Gallery
Property of the week: A cozy apartment in Bromma, Stockholm
Gallery
People-watching: January 17th - 18th
Lifestyle
How to make Swedish gravad lax
Lifestyle
Four hot Swedish home design trends
National
How The Local's video on a strange Swedish sound went viral
Gallery
People-watching: January 14th
National
The Local's guide to Europe in statistics - from Spain to Sweden
Politics
Paris attacks: Knock-on effects in Sweden and across Europe
National
Swedish Muslims react to new Charlie Hebdo magazine
National
The Local talks to Sweden's Home Affairs Minister about Paris attacks
Business & Money
Will Spotify launch on stock market after users rocket?
Accelerated
Texans and Swedes to play ice instruments
Gallery
Property of the week: An 18th century mansion in Stockholm
Business & Money
'Snowboarding drew me to work in chilly Sweden'
National
Are Sweden's royals moving to London?
National
How Sweden's Charlie Hebdo rally broke a winter protest record
Gallery
IN PICTURES: Princess Madeleine through the years
Gallery
IN PICTURES: Stockholm's 'no pants' subway day 2015
Gallery
People-watching: January 10th - 11th
Sponsored Article
Everything you need to know about moving to Stockholm
Sponsored Article
How to jump-start your career in southern Sweden
Latest news from The Local in Austria

More news from Austria at thelocal.at

Latest news from The Local in Switzerland

More news from Switzerland at thelocal.ch

Latest news from The Local in Germany

More news from Germany at thelocal.de

Latest news from The Local in Denmark

More news from Denmark at thelocal.dk

Latest news from The Local in Spain

More news from Spain at thelocal.es

Latest news from The Local in France

More news from France at thelocal.fr

Latest news from The Local in Italy

More news from Italy at thelocal.it

Latest news from The Local in Norway

More news from Norway at thelocal.no

1,117
jobs available
PSD Media
PSD Media is marketing company that offers innovative solutions for online retailers. We provide modern solutions that help increase traffic and raise conversion. Visit our site at:
psdmedia.se
Counselling and Psychotherapy in English
Sometimes living in another culture can cause stress, confusion and feelings of sadness and loneliness. Talking to a professional psychotherapist/counsellor might help you. I am a UKCP Reg. psychotherapist. My practice is in Södermalm, Stockholm.
Contact me to discuss your options