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gruffydd

Gotcha! - Qe And Devaluation

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Guest UK Debt Slave
life_on_mars.jpg

The UK's favoured export market, yesterday.

:lol::lol::lol:

Oh but hand on. We don't have that much sand

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So what does this mean? QE is failing in it's purpose for more credit, or it's succeeding in it's purpose for inflating savings & debts away?

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So what does this mean? QE is failing in it's purpose for more credit, or it's succeeding in it's purpose for inflating savings & debts away?

Neither.

It's just weakening the Pound.

It will cause inflation of food fuel etc but this is limited as many are sailing too close to the wind now, they'll be little inflation without wage rises.

It's bananarepuplicisation!

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Guest P-Diddly
Neither.

It's just weakening the Pound.

It will cause inflation of food fuel etc but this is limited as many are sailing too close to the wind now, they'll be little inflation without wage rises.

It's bananarepuplicisation!

Ultimately. Not sure on timescales, but propping all this inflated asset bubble up rather than a managed (if possible) deleveraging is well . . . bonkers.

QE destroys currency of import dependent country, causes inflation in food and energy and wotnot, still no export market because the rest of the bu$$ers are protectionist, housing market still collapses when QE is turned off. Biflationation.

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Wages are going through the roof aren't they? :lol:

IMO they don't need to and indeed musn't; the economy needs wage discipline in order to re-balance away from consumption.

But surely QE is about monetising debt that's already been defaulted by its original borrower. Boosting the wages of that borrower will make no difference now, apart from provoking more unaffordable consumption. It's the debt that's been taken onto the public balance sheet (in the form of nationalised banks, guarantees etc.) that QE is meant to address.

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The Alphaville article looks flawed to me. Seems to be mis-using the statistics to me.

It makes particular reference to the low level of foreign investments over the past 18 months - err credit crunch ring any bells???

The increase seems merely to be resumption of a trend that started some time ago but was interupted and nothing to do with QE.

edit: And it's debt discipline that's needed. Wage discipline on its own would be meaningless.

Edited by Matt Bear

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