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Next: Qe2 - And If That Doesn't Work It's A Currency War

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Worth a read - only wil ltake a few minutes.

On both sides of the Atlantic we are now looking at what economists are calling QE2 - a second bout of "quantitative easing" in which the central bank prints money to sustain demand in the economy, which is faltering.

In the UK, the Bank of England's MPC minutes show the majority as minded to have a go at this sooner rather than later; here in the USA (I'm in Atlanta, GA) the Federal Reserve have already spelled out both the possibility and the limitations of a further bout of QE. It's worth revisiting the latter: first, Fed Chairman Bernanke warned, we don't know how to calibrate the effects of the existing QE; second there is a risk that the markets lose condidence in the central bank's ability to exit from QE. Bernanke concluded that further QE might not have much impact because the best time to use it is when everybody in the market is panicking.

More at:

http://www.bbc.co.uk/blogs/newsnight/paulmason/2010/09/next_qe2_-_and_if_that_doesnt.html#comments

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I don't think there will be a currency war. To me it looks like this move is coordinated: USD down, JPY/EUR/RMB up in tandem, at the moment it's one display of pretty synchronised swimming.

The tell tale will be whether there is intervention when the Yen keeps rising against USD or not. My guess is not.

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Mervyn King is said by those who were on the inside to be privately proud of the fact he "talked down the pound" in 2008.

F*ck you MERV!

When the inflation arrives & so does all the damage you & Gordo did we should string the pair of them up!

Mike

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I don't think there will be a currency war. To me it looks like this move is coordinated: USD down, JPY/EUR/RMB up in tandem, at the moment it's one display of pretty synchronised swimming.

The tell tale will be whether there is intervention when the Yen keeps rising against USD or not. My guess is not.

Battle between China and Japan at the moment over rights to gas fields. I suspect the Chinese will use exchange rates as a gambling chip and will be quite happy to buy Yen as fast as the Japanese can sell it! They have Japan by the short, crinkly ones....

I'm watching Yen and Gbp and expect the rate to be back to the pre-intervention level of 129 within a few days.

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......

When the inflation arrives & so does all the damage you & Gordo did we should string the pair of them up!

....

You will have a long wait. All the Japanese QE and they're still waiting (and deflating...)

(Diesel down another €0.05 today here :D)

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Meanwhile in Europe it's likely that the net impact of all the austerity measures will be cancelled out by the depreciation of the Euro.

What joke this whole thing is. It's just as well most people have no clue how things work- if they did the bankers and politicians would be in deep shite right about now.

Had we put Bin Laden in charge, could he have f*cked it up any more? I doubt it.

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What joke this whole thing is. It's just as well most people have no clue how things work- if they did the bankers and politicians would be in deep shite right about now.

Had we put Bin Laden in charge, could he have f*cked it up any more? I doubt it.

Come off it Wonderpup, the bankers and politicians are the best thing that ever happened to me. They've provided me with a once in a lifetime opportunity and I'm all set to make a fortune for doing nothing more than using my noddle.

Gold and Silver!!!

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After QE 2.0 will come QE 3.0. Soon all will realize this is the new paradigm. There is now no going back to the good old days of private credit growth.

That game ended when they went to the zero bound on the central bank interest rates and it still wasn't enough to get things growing.

To me its a lot like when countries went off the gold standard. Eventually the old gold standard could no longer keep up with the monetary demands of vast industrial economies. There was a lot of hyperbole written about that too.. about how the US dollar would die out, dollar would be completely worthless etc..

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What joke this whole thing is. It's just as well most people have no clue how things work- if they did the bankers and politicians would be in deep shite right about now.

Had we put Bin Laden in charge, could he have f*cked it up any more? I doubt it.

That's an interesting comment about OBL. He certainly achieved a lot of what he set out to do by drawing the US/UK into completely unaffordable wars. Now all he has to do is sit back and watch us collapse into debt - that's of course assuming he ever existed/is still alive/etc.

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  • 261 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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