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Andrew Sentance Formerly Of Monetary Policy Committee Says Big Risk Emerging To Credibility Of Bank Of England

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Oddly enough, I was just returning from the shops when thoughts of this guy came into my head and I found myself wondering whether he would try to get a shot in before the BOE IR meeting in the next few days.

Looks like I was tuned in to his wavelength.

Nope, not seen it.

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A friend has just told me that this has just popped up as "breaking news" on Sky. Can anyone turn it on and see exactly what is says?

EDIT: "Creditworthiness" changed to "credibility" - I just got told the right word on their ticker - very important change there - but interestingly the words have the same root in truth.

Just typed a reply explaining it was credibility

Ho Hum.......

:)

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He is saying that UK inflation will not go down to 2% by the middle of next year which, IIRC, is what his boss Mervyn King has been saying for the past 5 months.

So he has put himself into direct conflict with Mervyn King.

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He is saying that UK inflation will not go down to 2% by the middle of next year which, IIRC, is what his boss Mervyn King has been saying for the past 5 months.

So he has put himself into direct conflict with Mervyn King.

Does ANYONE believe inflation will only be 2% by the middle of next year?

Unless of course base rate is 5%

:blink:

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Does ANYONE believe inflation will only be 2% by the middle of next year?

Unless of course base rate is 5%

:blink:

I highly doubt Mervyn King believes it. I think he is more concerned about debt levels. I mean in all fairness he admits to the last part.

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It won't change anything. Low IR for a years to come.

That is about the only thing you can guarantee isn't going to happen.

IMHO

:blink:

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That is about the only thing you can guarantee isn't going to happen.

IMHO

:blink:

Yeah, right. NO ONE CAN FORCE THEM. Inflation will stay here for years. People will let it happen cos they have no f****g clue what is INFLATION, they love low IR and expensive houses.

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I highly doubt Mervyn King believes it. I think he is more concerned about debt levels. I mean in all fairness he admits to the last part.

TBH I think the BOE are deliberately engineering inflation

Where I think they are deluded is in thinking that they can somehow keep it at 'manageable levels'

But perhaps I am wrong and everything really is under control

:blink:

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Yeah, right. NO ONE CAN FORCE THEM. Inflation will stay here for years. People will let it happen cos they have no f****g clue what is INFLATION, they love low IR and expensive houses.

The thing is - BOE base rate is now largely irrelevant anyway

5 year bonds are now offering rates of 5%

And you can't get a mortgage at 0.5%

There is a standoff in the housing market at the moment

How long it can last I'm not sure

2-3 years possibly?

:)

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Yeah, right. NO ONE CAN FORCE THEM. Inflation will stay here for years. People will let it happen cos they have no f****g clue what is INFLATION, they love low IR and expensive houses.

Sadly so true.

We live in a political environment where the Tories can do two things.

Option A: 'Actually' make cuts to national spending.

Which means reducing the cash going to various public sector departments.

Which the die hard left wing bureaucrats in charge implement by cutting solely from front line services while actually continuing to employ more non-jobs.

Soon half of mumsnet is busy writing letters to David Cameron personally to complain about their local play group being scrapped.

The BBC is busy w**king itself into a coma over all the front line jobs being lost.

Labour win the next election and the debt/deficit binge gets ramped up to all time new heights the moment they enter Downing Street.

Option B: Don't make any cuts.

Let the BoE ramp up inflation.

Mandate increases only to the parts of the public sector that actually add some value.

Let the national debt decline and the non-jobs loose purchasing power.

Make it hard for the BBC to pin anything on you.

Let the private sector re adjust in its own way.

Win the next election and keep a lid on the public sector and debt.

I can't really blame them for picking option B, sure its not the right thing to do, but its the least worse option that the sheeple will actually tolerate. People get the governments they deserve after all.

Edited by KingBingo

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He's a busy bee, is Mervyn. From his bio:

Mervyn King is a Fellow of the British Academy, an Honorary Fellow of King’s and St John’s Colleges, Cambridge and holds honorary degrees from Birmingham, City of London, Edinburgh, London Guildhall, London School of Economics, Wolverhampton, Cambridge and Helsinki Universities. He is a Foreign Honorary Member of the American Academy of Arts and Sciences, is on the Advisory Council of the London Symphony Orchestra, is Patron of Worcestershire County Cricket Club and is a Trustee of the National Gallery.

Yes, a regular renaissance man.

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  • 311 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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