Central bankers rightly become nervous - or at least slightly uncomfortable - if public expectations become too high or are elevated to quasi-religious dimensions. Moreover, if a central bank - for whatever reasons acquires prestige and standing that transcends the strict confines of its mandate and becomes an object of faith or mythical devotion, this may suggest that it fills a void left elsewhere. In particular this may be an indication of a lack of confidence in other - more important - institutions in society. To my mind independent central banks fulfil an important function for the benefit of society. Their job is to maintain price stability, maintain trust and confidence in the currency. Nothing more and nothing less should be asked of them. This reflects a clean division of labour and a clear allocation of responsibilities vis-à-vis other economic policy actors and, especially, vis-à-vis democratically elected governments. Stable money is too important to be overburdened with other purposes. This is especially important in the process of European integration. 7  BIS Review 96/2000  5. Faith in the European Central Bank, faith in Europe? The move to European Monetary Union is an important step in the long history of closer European integration. In particular, in the field of monetary policy the Maastricht Treaty represents a decisive act of delegation of decision-making authority or sovereignty. The Treaty entrusts the objective of price stability to an independent and supranational body, the European Central Bank.
Otmar Issing: Should we have faith in central banks? Speech by Professor Otmar Issing, Member of the Executive Board of the European Central Bank, held at St Edmund’s College Millennium Year Lecture, Cambridge, on 26 October 2000. *  *  *  Ultimately, trust must be earned, it is granted temporarily, it must be checked, and it must be backed up by hard evidence, not be based purely on faith or belief. It is a great honour and a great pleasure for me to deliver the St. Edmund’s College Millennium Lecture on the topic of faith in central banking. I must confess that when Professor Heap first invited me to give a talk on “Faith and Finance in the New Millennium” as part of a series of lectures on the general theme “Faith in the Future” I suffered an initial instant of hesitation or lack of faith, if you will. As you can imagine “faith” is not a natural subject to discuss for a central banker and economist, who is trained to look at facts and hard evidence. To address such a difficult issue in such a distinguished seat of learning as Cambridge University would seem to require a good measure of courage. But then, of course, courage - if not faith - is an attribute that central bankers should undoubtedly possess. I am also much reassured and grateful for the faith, if I may say so, that you put in me by inviting me to talk about this subject.