Monday, Jan 28, 2008
Yawn, yawn an irresponsible academic
Telegraph: MPC's Blanchflower calls for urgent rate cuts
Wish this guy would just go back to academia......''Professor David Blanchflower, the only member of the Bank of England's Monetary Policy Committee to vote in favour of a cut in interest rates this month, has hit out at the majority decision to hold rates saying that "worrying about inflation at this time seems like fiddling while Rome burns." ZZZZzzzzzzzzz
Posted by hpwatcher @ 01:48 PM (1278 views) Add Comment
20 Comments
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1. hpwatcher said...
Lets get everyone borrowing again and getting even deeper into debt.
2. seanb303 said...
i think we have reached a point where people simply can't borrow any more
regardless of what interest rates are doing
3. Orwell said...
Blanchflower must be quite worried about his BLT portfolio now!
4. Axxo said...
Fiddles were not invented during Roman times making that quote stupid...
5. jack c said...
"Expressing concern over the UK housing market, he pointed to diminishing mortgage approvals, which have fallen by a third in the last year, as a sign that immediate action needed to be taken to cut rates"
-------------------- over One Trillion Pounds worth of personal debt in the UK and this guy opts for a policy to make it worse !
6. handle_it said...
Some EA's probably have pictures of him making sweet love to a donkey.
7. happyrenterz said...
Someone here predicted that Central Banks will be able to create one more credit bubble before the whole house of cards finally collapses in 2011.
8. Landedgentry said...
Does this guy not understand that diminishing mortgage approvals compared to when they gave any jackass a subprime mortgage is a good thing?
9. geed said...
Why won't someone question his ethics. Debt it up people its the future!
10. cornishman said...
Maybe we should buy gold with borrowed money [as opposed to savings]. Now there's a thought. What a bubble that could be...
11. inbreda said...
Makes good sense cornishman. Inflation coming, erodes the debt, increases the value of gold.
12. tick tock said...
Blanchflower (on behalf of Gordon Brown) calling for rate cuts? What a bolt out of the blue that is!
I cannot imagine any economic circumstance in which Blanchflower would suggest anything else. He may as well put all his votes in for the rest of the year now and save us taxpayers the cost of his Trans-Atlantic flights.
What is the point of him?
13. drewster said...
@inbreda:
We might not just see inflation, some economists predict biflation. From Wikipedia:*
"Biflation is the state of an economy where the processes of inflation and deflation occur simultaneously. During this period there is a rise in the purchasing prices of commodity items and a fall in the purchasing prices of non-commodity items."
In biflation, basics such as food, energy, and raw materials cost more while houses and shares cost less. Manufacturers are trapped: their input costs rise but they can't raise prices because their customers can't afford to pay more - this is currently happening in China. The squeeze on manufacturers pushes down profitability, which causes lower dividends and lower wages. These in turn push down share prices and house prices respectively.
14. little professor said...
"worrying about inflation at this time seems like fiddling while Rome burns"
Excuuuuse me, but worrying about inflation is your sole remit as an MPC member.
15. alan said...
Wolfgang Munchau in the FT thinks the ECB is unlikely to follow the US cuts downward.
Good article.
http://www.ft.com/cms/s/0/81846ed6-cd27-11dc-9b2b-000077b07658.html
16. C'mon Correction said...
Exactly prof.
Recession is bad when it happens, but he can't expect everything to be rosey all the time. He voted for a rate cut in Nov 05 which kick-started the whole debt band wagon up again which has only compounded the situation we're in now. Him and Brown should look up what prudence actually means.
17. Tippingpoint said...
With London a centre for finance and Britain having a proud history of financial stability, what was the real reason for putting this foreign stooge on the MPC? The well being of the UK economy is clearly not his primary interest.
18. paul said...
Well his native US of A homeland has done a-okay from lowering rates drastically.
NOT.
19. Notaneconomicsguru said...
Hang on a minute.
Quote from MPC's webpage http://www.bankofengland.co.uk/monetarypolicy/framework.htm
"The Bank’s monetary policy objective is to deliver price stability – low inflation – and, subject to that, to support the Government’s economic objectives including those for growth and employment. Price stability is defined by the Government’s inflation target of 2%. The remit recognises the role of price stability in achieving economic stability more generally, and in providing the right conditions for sustainable growth in output and employment. The Government's inflation target is announced each year by the Chancellor of the Exchequer in the annual Budget statement."
Doesn't that mean there is a wider remit for MPC than just targeting inflation? I always understood the remit to wider than inflation, but inflation to be the primary concern.
In that case Blanchflower may not be so far of the mark if he thinks that the economy will be shafted by keeping inflation on target. Presumably that would be justification for a letter to the Chancellor? If he truly believes that, then isn't he right to speak up??
20. it_is_going_with_a_bang said...
"mortgage approvals which have fallen by a third in the last year, as a sign that immediate action needed to be taken to cut rates."
Oh I see. So when mortgage approvals were increasing at an alarming rate and house prices were going out of control he was obviously the first one up there demanding Rate hikes. Not.
Why do I get the impression it's a "one way economy ticket" for this idiot.
The problem with this a labour economist is that he has believes himself more than anyone or anything else. May aswell be Gordon Brown in his seat.