Wednesday, Oct 10, 2007
Merv is wheeled out to talk tough
Bloomberg: King Suggests He Won't Reduce Rate to Shield Banks
Bank of England Governor Mervyn King suggested he's reluctant to cut interest rates to shield lenders from increased credit costs and predicted more ``turmoil'' in financial markets. If you look closely at the picture you can almost see the strings ;-)
Posted by autopilotengage @ 07:55 AM (729 views) Add Comment
12 Comments
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1. Global Citizen said...
Yeah, Right! All talk and when it comes to action time he simply capitulates.
2. Quiet Guy said...
I don't understand the jibe "you can almost see the strings".
I think the government would like an interest rate cut to prop up the housing market. Merv is resisting because core inflation is rising and raising interest rates will lower the value of our currency which will make it harder to pay our national debt.
Or am I missing something?
3. Davidr said...
I like Mr King. However, whilst I gave up believing in Father Christmas and the Tooth Fairy a long time ago, the illusion of a "meritocracy" persisted to much more recently. Now I know that the former actually has more substance than the latter, as our business leaders and politicians so ably demonstrate. Mr King has to toe the line like they all do!
4. mrmickey said...
He will do what he's told
5. Ticktock said...
chuckle chuckle... wink wink... course you won't cut Marv...we believe you.. we really do...no honest.. why wouldn't we.. once you say it.. you mean it.. we all know that... its not as if the BOE exists to protect speculators and reckless banks is it....no no no.
6. Mark said...
this is BS, he gives to northern rock like it is a charity.... they should be left to go bust and clean up their own mess... If Joe Bloggs the plumber went cap in hand to the bank because he was in debt, they would tell him to get stuffed..........................
7. waitingfor hpc said...
yeah but if we cut rates watch the pound drop and inflation hit the streets? perhaps this is now understood in no 10 & no 11. how would they cope with more strikes and petrol @1.10 a litre?
8. Winnie said...
I think this is interesting. If he kept his job on the deal that he was going to cut rates then he would just not be saying this. That means he is in fact not on any "deal" as yet and is keen to reassert his independence and strength of resolve after being so cruelly set up in the NR crisis. IMHO..... Good news.
9. autopilotengage said...
Expectations are a powerful force with monetary policy; Merv saying he won't is almost as good as him actually not cutting rates for another much when the markets get hold of it, then if rates do get cut, it'll be neutral overall impact anyway in some respects, with only the loss of his professional integrity! Generally people have such short memories for monetary policy chatter and are so cynical anyway, so what does he have to lose really? it'll be August 2005 all over again next month when Merv gets outvoted on a cut...
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