Thursday, Nov 29, 2007
IR positioning
Reuters: Blanchflower wants rate cut now
Interest rates need to come down now, Bank of England policymaker David Blanchflower was quoted as saying on Thursday, though he admitted the central bank faced a delicate balancing act....."It is certainly a situation we have not had for quite a long time. It will be a delicate balancing act," he told the Birmingham Post.
Posted by alan @ 12:36 PM (1136 views) Add Comment
21 Comments
- If you do not have an admin password leave the password field blank.
- If you would like to request a password allowing you to add comments and blog news articles without needing each one approved manually, send an e-mail to the webmaster.
- Your email address is required so we can verify that the comment is genuine. It will not be posted anywhere on the site, will be stored confidentially by us and never given out to any third party.
- Please note that any viewpoints published here as comments are user's views and not the views of HousePriceCrash.co.uk.
- Please adhere to the Guidelines
1. waitingfor hpc said...
yeah right - and did he still have a brown tongue from kissing GB's bum - he is after all a plant in the MPC
2. Swiss88 said...
Blanchflower always wants a cut in rates! It is the same as any business orientated organisation who say either "I think rates should be on hold" or be "cut" (which is what they say at 5.5%, 4.5% and at 3.75% consistently!). The MPC's remit is to control inflation. Full stop. To protect people who have borrowed too much at the expense of everyone else & the wider economy is ridiculous.
If you borrow money you eventually have to pay it back (so if it is over 25 years don't borrow 7x income you loon!)
3. planning4acrash said...
He always wants a rate cut. Branch-Flower-Power wouldn't be happy until IR's were negative and a wheelbarrow was required to carry the currency to pay for a loaf of bread! Does he have wheelbarrow manufacturers?!?!?!
The fact that this comes from the Birmingham Post shows how in-credible he really is!!!!
4. jack c said...
Just received this via e-mail from NS& I (Nat Savings) "Due to falling yields in the gilt markets, we are reducing the rates on all of our fixed rate investments, excluding our Inflation-Beating Savings which remain at the current rates"
My feeling is that we will see a 0.25% reduction in the UK base rate as early as Thursday of next week.
5. george monsoon said...
This country is F****d !
What a bunch of (expletives removed..) we have running the economy.
How on earth can they justify a cut, while inflation is rife
6. cyril said...
Desperate times call for desperate measures. Mr Bean's days are numbered methinks.
7. jack c said...
G Monsoon – valid thoughts (expletives included) – the Gov/BOE now have a very difficult decision to make - on the one hand cut rates to ease the pressure on borrowers (including businesses) and maintain consumer spending/confidence and all that goes with it including the home ATM facility or on the other hand maintain or even increase rates to suppress inflation and avoid a slide in the value of Sterling. Tough times require tough decisions – thankfully the NR situation hasn’t been allowed to fester and has been brought to a swift and satisfactory £25BN conclusion (LOL)
8. paul said...
There is no chance the Bank of England can cut rates.
It would see a swift flight from sterling and with 14% rail fares increasing, food prices increasing, factory gate prices increasing and crude per barrel shoing no signs of falling the downside risks from cutting rates are immense.
The Bank of England have painted themselves into a very tight corner by excluding housing from inflation stats for so long and being coy about actual inflation, and now they are beginning to get very very worried, because even a rate cut will be like pushing on a piece of string because they no longer control credit - that role was taken by the money markets some time ago.
9. geed said...
I'm with you Paul, Logic says no cut. Oil hit $98 a barrel only a few weeks ago and this little flower wants a cut, talk about reactionary policy. Pleb. Lets face it the CPI has hardly been making a determined decent towards the 1% mark so no cut.
Lets not forget though that this was the very committee that sat with its finger up its @rse whilst the CPI hovered towards 3% and eventually breached it before taking some real action.
I have little confidence in its members to make the right decision.
10. dohousescrashinthewoods said...
With deflation on the horizon, I guess only hyperinflation can sustain economic stability now.
11. sovietuk said...
Judging by how much prices have gone up on everyday things in the last few months, inflation has to be running out of control at the moment. I was horrified at the price of unleaded at a local garage this afternoon - 104.9 a litre and it normally does failry reasonable prices. The inflation figures are meaningless dreamland figures. Just like the prices some people are expecting to get for their properties that have now been on the market for 6+ months with maybe just 1 viewing - everything seems to have become detached from reality.
12. talking rot said...
I can not see the logic behind a rate cut but Blanchflower's position makes me ask:
1. Which idiot appointment him?
2. Why did said idiot appoint such a dove to the MPC?
3. Is said idiot in a position to appoint more Blanchard-like members?
4. Is it likely said idiot will replace Blanchard with a clone?
5. When will said idiot go from office?
Where is the said idiot now and can said idiot do any more harm?
Hmmmmmmmmmmmm.
13. talking rot said...
Paul
In defence of Mervyn King ....
The CPI is a Euro-land [and international] agreed measure of inflation. Gordon Brown instructed it was adopted to placate Euro-bureaucrats who were irritated when UK did not join the Euro. Mervyn King has fought to have house prices included within the CPI and has, at times, become quite irritated by Euro-land's refusal to include house prices within the CPI. The exclusion of house prices from the CPI defies logic unless you live in Euro-land where a high percentage of people rent and therefore house prices are a pretty meaningless measure of inflation.
Gordon Brown adopted the CPI to placate Euro-bureacrats; Mervyn fought (and failed) to have house prices included. This one can't be pinned on Mervyn King.
14. Gdbain said...
Also...people are dreaming if they think banks will pass on the reduction.
15. drewster said...
talkingrot,
They'll probably change CPI to include house prices very soon now that the market has peaked. Then for the next ten years of stagflation people will complain that the price of bread and milk is soaring, and Brown will just say "but the CPI is low!" (because house prices are falling)
16. talking rot said...
drewster
My thoughts [and worries] too!
Hopefully Euro-land will continue to resist the inclusion of house prices within CPI! Given the trouble in Spain, France and Italy, where Euro-rates are too high, I would not be surprised if they signed up to anything that would cause rates to fall though.
17. planning4acrash said...
Diesel at my local petrol station is above £1.10!!!!!!!!!!!!!!!!!!!!!!!
18. Stevie Dee said...
The Govt/BoE are white feathers!!!!
19. Stevie Dee said...
Cowards!!!
20. This comment has been removed as it was found to be in breach of our Blog Policies.
21. Stevie Dee said...
Only pride stops you throwing good after bad..