Lagarde’s maiden speech as ECB President last eve was a snoozer because she didn’t go into monetary policy or politics. The speech was in honor of former German Finance Minister Schäuble, the fiscal hawk everyone loves to hate. Lagarde showered Schäuble with praise, which has a kind of Stockholm Syndrome thing to it. Schäuble was Lagarde’s adversary at certain points in time in the 2015 Greek crisis. In the end, Lagarde as managing director of the IMF, over-ruled her own staff by giving the third Greek bailout the Fund’s blessing. If she had followed the IMF’s rules, which forbid it to lend to insolvent governments, she should have insisted on the Germans and other European creditors taking an outright haircut. We would really recommend reading Varoufakis’ book Adults in the Room if you want to know more about Lagarde and the Greek crisis.

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