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gruffydd

How Can The Boe Justify Any More Qe, Now We Have A Recovereh?

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Just heard an article on Auntie Pravda Radio 4 - suggesting a new phase of QE is a done deal - more money needs to be printed, etc. But HOW can they justify it against the backdrop of green shoots. And what will the consequences be?

Edited by gruffydd

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Just heard an article on Auntie Pravda Radio 4 - suggesting a new phase of QE is a done deal - more money needs to be printed, etc. But HOW can they justify it against the backdrop of green shoots. And what will the consequences be?

More QE would mean the recoverehTM would be exposed for what it really is. Utter horseshit.

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I just got a leaflet e-mailed through from the boe 'explaining' QE for businesses. Are we being softened up for an expansion of the £150bn programme that's already underway? Sure they have yet to announce that they will print the final £25 billion - but that's already a done deal. Why the sudden effort to 'explain' QE?

Edited by gruffydd

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Looking at BOE Trends in Lending - July 2009

http://www.bankofengland.co.uk/publication...rendsJuly09.pdf things still look bad out there.

Net lending to businesses is probably still negative. Demand for credit appears very weak, and mostly to restructure balance sheets.

Neil Woodford in Telegraph

"Neil Woodford: 'UK economic green shoots look illusory'

...

On the economy, I see little reason for confidence and I do not anticipate meaningful recovery in the next three to four years. However, a point that I believe is worthy of stressing is that despite this I am positive about the outlook for my portfolios because I believe that certain areas of the equity market are fundamentally undervalued."

http://www.telegraph.co.uk/finance/persona...k-illusory.html

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please tell me its a spoof

For an "experiment", they seem to have defined PONZI scheme in fine details.

item 1...issue cash

item 2...assets increase in "value"

item 3...asset owners are more wealthy ( Fracking magic ) they borrow more due to low costs and SPEND SPEND SPEND.

where are the FRAUD SQUAD.....this is PONZI.

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Guest absolutezero

I like this bit of the pamphlet:

Just as the Bank takes the steps necessary to contain the risks of below-target inflation, it also acts if it thinks inflation looks set to rise above 2%. In that case, the MPC could put downward pressure on spending and inflation by raising Bank Rate and removing the extra money by selling the assets it previously purchased.

Slight problem.

What if there are no buyers....?

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Guest Daddy Bear
Just heard an article on Auntie Pravda Radio 4 - suggesting a new phase of QE is a done deal - more money needs to be printed, etc. But HOW can they justify it against the backdrop of green shoots. And what will the consequences be?
And what will the consequences be?

:D

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Guest KingCharles1st

Surely QE exists just to top up the banks, and then they can sit on it while joe public thrashes about?

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Frankly, this is f*cking terrifying it reads like some sort of spoof from The Simpsons.

Yep

everyone who reads that needs also to read this history lesson

link

Here is the untold and still largely unknown story of a major factor behind the French Revolution. As John Mackay writes in the introduction:

"It records the most gigantic attempt ever made in the history of the world by a government to create an inconvertible paper currency, and to maintain its circulation at various levels of value. It also records what is perhaps the greatest of all governmental efforts--with the possible exception of Diocletian's--to enact and enforce a legal limit of commodity prices.

"Every fetter that could hinder the will or thwart the wisdom of democracy had been shattered, and in consequence every device and expedient that untrammelled power and unrepressed optimism could conceive were brought to bear. But the attempts failed. They left behind them a legacy of moral and material desolation and woe, from which one of the most intellectual and spirited races of Europe has suffered for a century and a quarter, and will continue to suffer until the end of time. There are limitations to the powers of governments and of peoples that inhere in the constitution of things, and that neither despotisms nor democracies can overcome."

What's remarkable is how conventional histories of the period treat this huge economic reality as a mere footnote, and that's mostly because historians are not usually alert to the cause and effect relationships in economics. But this book is different. Author Andrew Dickson White puts the monetary story right at the center of action, and compellingly shows how it leads to a national catastrophe.

As the the author writes, inflation "brought, as we have seen, commerce and manufactures, the mercantile interest, the agricultural interest, to ruin. It brought on these the same destruction which would come to a Hollander opening the dykes of the sea to irrigate his garden in a dry summer. It ended in the complete financial, moral and political prostration of France-a prostration from which only a Napoleon could raise it."

This study was first written in 1896, and it has not been surpassed, and nor has its historigraphical power been diminished

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When to stop QE and how

The Bank of England is committed to low and stable

inflation. Together, large cuts in Bank Rate and

quantitative easing provide the economy with a

substantial boost, and reduce the risks of inflation

falling below the 2% target.

But the Bank will not let inflation get out of control.

Just as the Bank takes the steps necessary to contain the risks of

below-target inflation, it also acts if it thinks inflation looks set to rise

above 2%. In that case, the MPC could put downward pressure on spending

and inflation by raising Bank Rate and removing the extra money by selling

the assets it previously purchased.

Economic conditions can and do shift rapidly. The job of the MPC is to

navigate through these changes and to take the steps necessary to keep

inflation as close to the 2% target as practical. By delivering low and stable

inflation, the Bank of England will play its part in fostering the climate of

stability that is essential to the UK economy.

it will stop once Brown loses the election and Cameron realises how dangerous it is, in the meantime its like a drug addict saying "I can stop whenever I want, it's cool"

additionally the boe doesn't seem to know when its a capita G for government and when it's a small g, how confidence inspiring.

fecking amateurs from basement to top floor, i hope their maths are better than their essay skills

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it will stop once Brown loses the election and Cameron realises how dangerous it is, in the meantime its like a drug addict saying "I can stop whenever I want, it's cool"

additionally the boe doesn't seem to know when its a capita G for government and when it's a small g, how confidence inspiring.

fecking amateurs from basement to top floor, i hope their maths are better than their essay skills

Cameron wil do whatever the bankers tel himto, just like Brown.

All that will change are the excuses.

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That leaflet should be put in a clear bag and labelled Exhibit A if they shaft us all the way its looking, they're like school children taken over the office on bring your kid to work day, minus the occasional good ideas

Cameron wil do whatever the bankers tel himto, just like Brown.

All that will change are the excuses.

if he's a complete fool yes

Edited by loginandtonic

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That leaflet should be put in a clear bag and labelled Exhibit A if they shaft us all the way its looking, they're like school children taken over the office on bring your kid to work day, minus the occasional good ideas

:lol:

not funny really though

still it should be written about in many history books

stop them

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The stated goal of the BoE is to keep inflation at ~2%. They pumped £125 billion in over a few months, and still the country went from a small inflation, and into small deflation. And it is going further into deflation as each month goes by. As are all the other major economies.

So the BoE needs at least another £150 billion in QE over the next few months. QE to fund fiscal stimulus is the ideal way because the fiscal spending can be spent broadly into the economy. Whereas monetary stimulus can go to just a few people and sit on balance sheets.

I'd personally push the next wave to £200 billion.

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thx but whats the point of any more f[cking petitions, they dont take a f[cking blind bit of notice, they think they know better than the established ways, like teenagers who think they invented sex or a crafty smoke down the alley, we cant stop these idiots with their know-all ways from peeling apart all the things that kept the economic fabric relatively stable for hundreds of years, they're a bunch of get rich quick ponzi morons and they've converted enough of the population to retail addiction and instant gratification to make this credit and debt disease unresponsive to anything other than cold turkey which they dont want to do for fear the tide will go out revealing them stark boll0k naked and actually unelectable and unfit for government (which they surely are)

this country needs to kill off its debt culture and rebuild from the bottom upwards, not run into further massive debt individually and nationally and put off the real challenge of purging the ponzi money for another day

Edited by loginandtonic

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