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Mark Carney Thinks Occupy Wall Street Was 'Constructive' And Has 'Always Watched The Pennies'

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MARK CARNEY
Mark Carney, our new governor for the Bank of England | AP

Mark Carney has been revealed as the next Bank of England governor, but who is he?

Currently the governor for the Bank of Canada and the chair of the global Financial Stability Board, Carney will move into his new role in June 2013.

He will receive £624,000 a year for the five years of his tenure, and has said he intends to take on British citizenship for the term of his residency.

Now 47 years old, Carney was the youngest central bank governor when he won the Canadian role in 2008, having been the deputy governor for five years previously.

He was later named one of Time Magazine’s most influential 100 people in 2010.

Under his watch, Canada has not had to bail out any of its banks during the financial crisis. As with the Bank of England's Mervyn King, Carney steered the Bank of Canada to introduce substantial additional liquidity to the Canadian financial system, and took the unusual step of announcing a commitment to keep interest rates at their lowest possible level for one year.

And Canada has been running a national bank aimed at helping small and medium-sized businesses for some time now - a measure the UK wants to introduce with the British Business Bank.

But some commentators may be wary of the 13 years he spent working at Goldman Sachs, known colloquially as the Vampire Squid.

Early life

Carney is the third of four children, and grew up in a small town where his dad, Bob Carney, was the principal of a local school.

He won a partial scholarship at Harvard where he began studying mathematics and English literature, before changing his degree to read economics.

Even at university, he was “good with money” and “counting the pennies” according to a report in the Readers' Digest, which contacted former college mates.

After graduation, Carney took a job with Goldman Sachs in London, and then Tokyo, working in progressively senior positions.

In 1991 he left the investment bank to earn his PhD in economics at the University of Oxford and while there, met his wife Diana Fox, a British economist specialising in Third World development.

Carney was finishing his thesis in 1995 - which he had apparently planned to parlay into a job in policy - when Goldman Sachs offered him a new role.

Carney today

Carney has a reputation for taking populist positions sometimes at odds with the country’s business elite – he openly called the Occupy Wall Street movement “constructive” and chastised Canadian businesses for sitting on cash piles.

He’s also taken the highly unusual decision to speak directly to businesses – last month he spoke to the Canadian Auto Workers union about the contentious issue of Dutch Disease - the hotly-contested phenomenon of Canada's manufacturing base being eroded by an overly high dollar.

Such a hands-on attitude has led many to call for him to enter Canadian politics, though this will have to be put on hold until after his Bank of England tenure has come to an end.

Reaction to his appointment has been broadly positive.

Alastair Winter, chief economist from small companies adviser Daniel Stewart and Co, told Huff Post UK: "The appointment of Mark Carney is excellent news and comes as a surprise after all the denials. He has impeccable credentials as a central banker and an independently-minded one too.

"He seems much less prickly than Sir Mervyn and also more decisive. While not an out-and-out hawk, Carney will reassure those who worry about inflation getting out of control... He will definitely want in his own way to 'help' the chancellor to improve the economy and this should work very well as neither seems afraid of robust argument."

Hugh Morris, vice president of business development banking EMEA at business services company Genpact, said: "Mark Carney needs to work with the City to rebuild processes in banking operations to be inherently transparent and to fully utilise inbuilt compliance and inspection. This will ensure an immediate reduction in risk and a demonstration of trust to the public. In current times, such factors can only benefit the industry, whilst keeping it competitive."

However, the TUC's general secretary Brendan Barber warned that the chancellor has made the new governor's job "close to impossible", according to the Daily Mail.

"Government policies of austerity have sent the economy back into recession and threaten a lost decade of stagnation. The chancellor seems to have outsourced the job of getting the economy moving to the Bank of England but the Bank is now running out of monetary ammunition," Barber said.

Adam Marshall, director of policy and external affairs at the British Chambers of Commerce, said: "The new governor must work closely with the Treasury to find ways to boost the supply of credit to new and growing businesses.

"We hope that Mark Carney will also play an instrumental role in bringing a British Business Bank to life - something that Canadian small and medium-sized enterprises have benefited from for many decades."

Carney will be subjected to a pre-commencement grilling by a parliamentary select committee following the appointment.
Filed by Charlie Thomas
 
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