Fed, Europe Should Get in Sync on Rates

The American electorate has been wise enough over the past three decades to, more often than not, split its ticket. This hasn't reflected radical moderation so much as a form of risk management, an extension of the checks and balances so wisely written into the Constitution by the Founding Fathers.

The same principle of policy diversification extends globally among the various finance ministers and central banks. Sometimes their policies have been disparate -- the Federal Reserve's manic rate-cutting of 2001-03 was not matched by the other major central banks, nor was the Bank of Japan's similar charge toward 0% in the 1990s.

At other times, policies have been coordinated with little success. The 1987 stock market crash was preceded by two years of central-bank coordination to drive the dollar lower, and the final leg of the global equity boom in the late 1990s was preceded by choreographed rate cuts. ...