The Rains of Castamere – a warning about central banks

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For those familiar with the TV series Game of Thrones or the book series A Song of Ice and Fire, The Rains of Castamere need no introduction. But for those vaguely familiar, or even unfamiliar, I shall give a very brief description.

The Rains of Castamere is a song which features in the series and it is about Tywin Lannister’s crushing victory over the rebellious House Reyne of Castamere and the destruction of their house at the end of their rebellion. It’s typically sung as a reminder to those who cross the Lannisters and the fate which awaits them. At this point you may well be thinking “what has this got to do with central banks?”, well, everything.

The Lannisters are the wealthiest family in the Seven Kingdoms and have gained a reputation for being financiers to the crown. When Robert Baratheon raised his rebellion against the ruling Targaryens, the Lannisters eventually turned against their king and joined with the rebels. Unpaid debts, in this case, lead to a forceful and violent change in government. Real life examples of this type of behaviour do not exist as a direct comparable. However, a similar sort of behaviour can be seen in the ECB’s dealings with Greece and Italy over unpaid debts. Again, central bank behaviour has forced a change of government.

The Lannisters, in their role of a central bank, also have to contend with the Iron Bank. The Iron Bank is essentially a Westerosi equivalent of the IMF. If you get a visit from the Iron Bank you’re in a lot of trouble. If you can’t pay your debts to the Iron Bank they will see that you are ruined. For example, in A Feast for Crows, the Iron Throne (headed at this point by Cersei Lannister) refuses to pay their debts owed to the Iron Bank. The Iron Bank, in response, calls in all outstanding debt across the Seven Kingdoms and refuses to issue new loans ushering in an economic collapse.

The moral of the story, as indicated by the series, is that one must not mess with central banks for one will always come off worse. One should also be wary of the immense political influence central banks hold through their manipulation of the monetary system.

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