A recent #ActiveAllocator survey shows that central banks rate “avoiding default” as their most important objective. That hope for serendipity is now likely over. Central banks now face heightened concern from the economic slowdown, rising deficits, currency debasing and assorted other risks.
I recommend that they should further increase reserves in conjunction with greater currency and instrument diversification, and invest in new asset classes. I draw attention to developing a new benchmark, by encouraging thinking through first principles in a visual here.