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King:no Rate Rise Till Unemployment Drops+Qe3 Possible.

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seems like desperation to me. how much longer can he shaft the savers for?, cause lets face it thats exactly what the whole strategy comes down to, basically making savers pay the loses of the feckless.

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seems like desperation to me. how much longer can he shaft the savers for?, cause lets face it thats exactly what the whole strategy comes down to, basically making savers pay the loses of the feckless.

Rubbish. I've made a combined (I've worked it out by asset allocation) 27% return per annum in the last two years on my savings thanks to King and Co.

If I'd have put the lot in silver I'd have made 50% per annum! But it's very volatile, so I allocated a smaller amount to that than gold. For example, I'd actually made 75% per annum from silver until it corrected back down from $50/Oz to $35/Oz.

This is the biggest wealth transfer in history, from those that hold wealth in paper and certain assets like housing to those that hold in real money. A once in a lifetime event.

More power to you Merv!!! B)

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we're doomed with this muppet in charge.

Is he in charge though, any more than Helicopter Ben is in charge?

Both are Quislings.

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large cash injection directly into the economy to boost asset prices and spending was possible.

I'm confused - doesn't 'boosting asset prices' just mean 'make stuff more expensive' - how does that also boost spending? Well, except in the sense of 'spend all your money or starve'. It's not like we're going to buy more - we're going to buy less but for more money.

Assuming this point hasn't escaped them, wtf?

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seems like desperation to me. how much longer can he shaft the savers for?, cause lets face it thats exactly what the whole strategy comes down to, basically making savers pay the loses of the feckless.

Well given this Knowledge why don't you go and spend some of it?

I agree with you about the desperation bit though. I remember two press releases that said that when interest rates go up they would go up quickly. Just jawboning to stop people taking on large debt when interest rates are low. The jawboning has changed to It's ok to spend money rates wont rise for a long time.

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Oh deary me waiting for unemployment to drop significantly is dangerous. I think from memory it's a lagging indicator.

ALso what if the games changed ? I'm always first to rebuff the technology utopia but there's alot out there now that potentially makes labour redudant. You can see firms going down this route - supermarkets, banks. THese firms are unlikely to start removing machines, and replacing with people when the economy improves.

Yes, the idea is that we start exporting but the MPC seem also to be concerned about consumer spending. They can't have it both ways!

Even then presumably the high-tech exporting is lower labour requirement.

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Did the last QE's even boost employment? Surely as cost rise more businesses will close therefore higher unemployment.

I don't relish the thought of paying even more for everything whilst earning the same amount, it's bloody unfair. No doubt the public sector will want more money from us.

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Sir Mervyn also indicated yesterday that a large cash injection directly into the economy to boost asset prices and spending was possible.

QE - one tool fits all jobs.

Incredible to think that he believes keeping asset prices up and giving people money directly off a printing press is good for us. Based on what we've seen so far it will simply drive up the cost of essentials leaving people with even less to spend on housing and the general economy.

This is yet more proof housing is the UK economy and must be spared at all costs. The cost will be the buying power of our currency taking yet another hit.

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Well given this Knowledge why don't you go and spend some of it?

I agree with you about the desperation bit though. I remember two press releases that said that when interest rates go up they would go up quickly. Just jawboning to stop people taking on large debt when interest rates are low. The jawboning has changed to It's ok to spend money rates wont rise for a long time.

That was a bad mistake by the central bank to keep telling people that rates would rise any day now. I think it was Krugman who argued the central bankers should say we'll keep rates at 0% for a period of time say 3 years.. even if inflation starts taking off.

They have to get the economy moving, get people spending so the money is flowing. Once the money is flowing then they can worry about keeping it under control. But imo central bankers have been so worried about exit strategies and such that they forgot about getting the money flowing.

Its like worrying about step 3,4 and 5.. when you haven't got through step 1 yet.

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Tackling inflation will eventually boost the economy and create jobs. Price stability is essentially to economic success in the long term.

However another question is as off-shoring jobs is so popular why is increasing the cost of UK labour via inflation going to make us appealing to external investment.

They will not raise interest rates until forced.

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That was a bad mistake by the central bank to keep telling people that rates would rise any day now. I think it was Krugman who argued the central bankers should say we'll keep rates at 0% for a period of time say 3 years.. even if inflation starts taking off.

They have to get the economy moving, get people spending so the money is flowing. Once the money is flowing then they can worry about keeping it under control. But imo central bankers have been so worried about exit strategies and such that they forgot about getting the money flowing.

Its like worrying about step 3,4 and 5.. when you haven't got through step 1 yet.

spending through borrowing?

is that really the plan?

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Can't believe they are even considering printing with inflation at over 5% and realistically more like 8%. When do they stop? 10% 15%? 50%?

Never mind an Arab spring, think we might see a British Autumn!

Everybody should put in for 20% pay rises, Merv would soon about turn then!

The lunatics are in charge of the asylum for sure.

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Can't believe they are even considering printing with inflation at over 5% and realistically more like 8%. When do they stop? 10% 15%? 50%?

Never mind an Arab spring, think we might see a British Autumn!

Everybody should put in for 20% pay rises, Merv would soon about turn then!

The lunatics are in charge of the asylum for sure.

I'm starting to think they want a Russian event like the 1990s when it tipped into hyper for a bit. This essentially wiped out USSR debts of pensions. Meaning the productive classes could get on with doing work. To clear out the chaff they had hyper twice.

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I'm starting to think they want a Russian event like the 1990s when it tipped into hyper for a bit. This essentially wiped out USSR debts of pensions. Meaning the productive classes could get on with doing work. To clear out the chaff they had hyper twice.

Meh.

Bankers lied and the choice is either to not pay the people they owe which will cause bank runs and collapse instantly or print more money and keep it going another day.

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I wondered why Sterling has just hit a new 52 week low against the Euro :rolleyes:.

Ah yes. i know the answer to this one.

It's because I am about to go on holiday to Europe and need trvel money. :angry:

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http://www.dailymail.co.uk/news/article-2009374/No-rate-rises-unemployment-drops-economy-grows-says-Mervyn-King.html

'The Governor of the Bank of England Sir Mervyn King has suggested that interest rates would not rise until it was certain the economy was growing and there had been a drop in unemployment.

The economy is growing and unemployment is falling. The government are certain of that because they tell you those are the facts. Therefore interest rates will now rise (unless someone is lying).

Edited by campervanman

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Ah yes. i know the answer to this one.

It's because I am about to go on holiday to Europe and need trvel money. :angry:

By the same logic, my fixed rate expires in November (to the Nationwide BoE+2%-for-life thing). So that's about the time you'll see sudden rate hikes, Merv is not being vigilant, he's teasing me personally.

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Sterling falling hard now.

GBP/EUR = 1.000/1.105

Merv, our very own personal Greek economy

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I'm confused - doesn't 'boosting asset prices' just mean 'make stuff more expensive' - how does that also boost spending? Well, except in the sense of 'spend all your money or starve'. It's not like we're going to buy more - we're going to buy less but for more money.

Assuming this point hasn't escaped them, wtf?

The problem is, all he can do is target rates. either directly or indirectly (via QE).

Inflation as a method of soft debt default has always worked in the past due to wage rises, on account of fairly illiquid export and labour markets. It just isn't going to happen this time due to the excess capacity of labour now available in the emerging economies ( thanks to the free trade agreements starting in the mid eighties in Uruguay and the creation of the WTO), as well as much more debt being index linked (i.e..Bond buyers actually insisting that the barber's at the Central Bank use blunt scissors to cut their hair and not a chain-saw) .

He thinks he's playing draughts whilst, in reality his opponent has been playing chess.

Trouble is, he's up against Kasparov.

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Sterling falling hard now.

GBP/EUR = 1.000/1.105

Yes, almost just fell of my GBP/USD chart. I then looked at forex factory for any news related reason for the fall. No news today out for the UK.

Doesn't look good, does it.

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  • 312 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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