Sunday, Mar 08, 2009
BoE has a new mission
The Times: Easy does it as Bank promises option of last resort will work
"the Governor was emphatic in his interviews that the Bank’s new policy could not fail. Mr King said this was clear to him since, as a question of fact, there was no limit to the amount of new money that the Bank could create to pump into the economy in its drive to encourage consumer and business spending and to restore growth."
Posted by quiet guy @ 01:19 PM (1447 views) Add Comment
18 Comments
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1. crunchy said...
So let me get this straight the BOE are saying that all parties are all going to be winners.
Does not work like that. Not fooled!
Quote- "there was no limit to the amount of new money that the Bank could create to pump into the economy in its drive to encourage consumer and business spending and to restore growth."
No wonder this idiot is camera shy. I thought King had some sense. We are doomed.
I have said before that wages would have to at least double for this to work. There is the puzzle.
I have also said many times on here, HYPERINFLATION DEPRESSION. Go figure.
2. crunchy said...
They are trying everything they can to not only preserve this bubble but make it even bigger. Growth, growth, growth.
Forget pound coins and money as we know it. The totally electronic money age is coming. No need for wallets folks.
Money will be no obsticle in the future for politicians and banksters.
3. enuii said...
The only way it will work is if a good proportion of it ends up in peoples pockets permanently - unfortunately we do not have the economy to support such a policy and as for encouraging consumer borrowing a significant proportion of the population still have the financial hangover from the last 10 years.
4. crunchy said...
The electronic obsticle we be for us. Period.
5. Crunchy said...
will be for us.
6. happy mondays said...
If the boe and the government have a bottomless pit of money, why are we all not living the dream? Why are our hospitals falling apart? Why are the old freezing during the winter? Why do our youths get a factory education? Why did my dads pension fail on him ? Why are most of us trying to better ourselves, when there is a bottomless pit of money? Yes of course! When it suits the few!
Cannot do all of the above because it stuffs up the economy! Why do i listen to these clowns? In fact i don't, but unfortunately enough sheeple do, to allow them to think they are in control. People will slowly come out of there deep slumber, and as Bill Hicks said they will realise, It's just a ride! and we have all been taken on a big one!
7. crunchy said...
3. enuii
The only way it will work is for another sound monetary system. Gold standard gives the people control so that's out.
That is why I feel my above Mickey Mouse money system is far more likely.
8. stillthinking said...
"initial ceiling " . What kind of ceiling is that?
9. crunchy said...
http://curezone.com/art/read.asp?ID=146&db=1&C0=11
The Mickey Mouse money system.
Yes I know I am crazy, but read it and other articles if you dare. There is nothing as crazy as reality.
10. robh said...
An 'initial ceiling' is like one in a cartoon... that the piano falls through
then it falls though the next ceiling
and so on
notice that things go down through the ceiling not up
11. Jeremy said...
(Devil's advocate)
BoE sees velocity of money is way too low, therefore they want to increase the supply to avoid general price deflation. I guess the interesting part is what they do if confidence returns and the velocity rises again (sharply perhaps) - presumably interest rates come out of the bag to pull the money back out of circulation again?
12. wealthyvagrant said...
“There is no limit to how much we can do, which is why, in the end, this policy will work . . . I can’t tell you when it will work precisely, but eventually it will work — we will start to see a recovery.”
Oh dear. That said, I think a strategic valuation is our best option at this stage, but then I don't have any savings in £.
13. tyrellcorporation said...
I think Merv is getting a bit cocky, after all, I think Sterling dropped just 1 cent against the Dollar after the official announcement on QE last week. He now sees this as a green flag to have limitless printing of new money. I think the currency markets will baulk at this idea and give Sterling a good kicking.
It still amazes me that we're 1% ABOVE the target inflation rate and the presses are going at full tilt. Can anyone on this site who works in the financial sector please explain why Sterling hasn't been keel-hauled? It's not the reserve currency after all.
14. inflation is eating my savings said...
crunchy- you make the same spelling mistakes as s2r1.
15. crunchy said...
12. inflation is eating my savings-you make the same mistake as most people you focus in on things that don't matter.
16. dohousescrashinthewoods said...
His point of fact is accurate, his deduction is not justified.
Consider this:
"there was no limit to the amount of new money that the Bank could create"
Accurate - there is no limit.
But, consider this:
"the Governor was emphatic [the] policy could not fail"
Oh yeah? Says who?
It has never worked before and, in fact, has arguably done more harm than good every time.
"Ignore the propaganda, focus on what you see" - if you stand back and look at it, the government hasn't got the money. They must know the banks will fail and they need a policy in place. Clearly that is inflationary, so we need to be lulled into accepting it ahead of time.
17. inflation is eating my savings said...
crunchy- I'm guilty as charged.
But the sun was shining here today, and I've just eaten toad in the hole made with left over roast beef.
As a saver, I'm paradoxically happy that Merv is chucking money in. I think system failure is perhaps good to avoid. Unless you have some well-fortified land. Which I don't.
I agree with you that we need to watch for a change in the weather. I don't think we are there yet.
18. crunchy said...
I agree with you that we need to watch for a change in the weather. : )
That's when the TV nation will finally start to get it.