FreeTrader Posted October 25, 2011 Share Posted October 25, 2011 Mervyn King and Charles Bean are in front of the House of Commons Treasury Committee this morning to explain the effectiveness of QE and the justification for a further round. Live on Parliament TV at the following link: http://www.parliamentlive.tv/Main/Player.aspx?meetingId=9237 Quote Link to comment Share on other sites More sharing options...
FreeTrader Posted October 25, 2011 Author Share Posted October 25, 2011 Hmm. Andrew Tyrie (committee chairman) comes across as a housing VI. The meeting is about QE but his opening concerns are about LTV ratios in the housing market. Quote Link to comment Share on other sites More sharing options...
FreeTrader Posted October 25, 2011 Author Share Posted October 25, 2011 The MPs are absolutely useless. No wonder Merv runs rings around them. It's like an adult talking to children – they're woefully uninformed. Quote Link to comment Share on other sites More sharing options...
FreeTrader Posted October 25, 2011 Author Share Posted October 25, 2011 Merv getting angry at George Mudie – quite rightly so. He's way out of order – and wrong. Quote Link to comment Share on other sites More sharing options...
man o' the year Posted October 25, 2011 Share Posted October 25, 2011 Accused of not supporting SMEs with Qe money not being lent Benny Hill said it was nonsense. I sought a loan this week to expand my business (and create 2 further jobs)and rate would now be between 3.45 aan 3.75 % above base. This would mean our risk and work would only reward the bank. RESULT = no loan, no jobs created. Quote Link to comment Share on other sites More sharing options...
Georgia O'Keeffe Posted October 25, 2011 Share Posted October 25, 2011 Accused of not supporting SMEs with Qe money not being lent Benny Hill said it was nonsense. I sought a loan this week to expand my business (and create 2 further jobs)and rate would now be between 3.45 aan 3.75 % above base. This would mean our risk and work would only reward the bank. RESULT = no loan, no jobs created. you mean they are actually charging a risk premium for credit extension, ooo how nasty Quote Link to comment Share on other sites More sharing options...
Killer Bunny Posted October 25, 2011 Share Posted October 25, 2011 Thx for the link Mervyn's just confirmed that their actions are inflationary. He says SME's would be hit harder had they taken no action (long term Merv?). I'm pretty sure an MP just said the Treasury will need to borrow £600Bns over next few years (on top of Bank's borrowings). Do you think our LT rates will rise? Er... Quote Link to comment Share on other sites More sharing options...
man o' the year Posted October 25, 2011 Share Posted October 25, 2011 you mean they are actually charging a risk premium for credit extension, ooo how nasty Nope - expansion not extension. We have successfully paid down the loan we had on our first business (at 1.5 over base) and would now take out another loan to set up the same type of business. Quote Link to comment Share on other sites More sharing options...
AteMoose Posted October 25, 2011 Share Posted October 25, 2011 (edited) he just admitted the devaluation of the currency was intentional/needed. They aren't trusting his forward predictions, asking for a timeline on how inflation will get to 2% in a year Edited October 25, 2011 by AteMoose Quote Link to comment Share on other sites More sharing options...
FreeTrader Posted October 25, 2011 Author Share Posted October 25, 2011 Merv: Hard to come up with any reasonable argument as to why inflation will not fall sharply next year. Quote Link to comment Share on other sites More sharing options...
AteMoose Posted October 25, 2011 Share Posted October 25, 2011 asking king to score his predicting out of 10..... 4? 5? you dont examine your predictions? Quote Link to comment Share on other sites More sharing options...
57percent Posted October 25, 2011 Share Posted October 25, 2011 Accused of not supporting SMEs with Qe money not being lent Benny Hill said it was nonsense. I sought a loan this week to expand my business (and create 2 further jobs)and rate would now be between 3.45 aan 3.75 % above base. This would mean our risk and work would only reward the bank. RESULT = no loan, no jobs created. That doesn't seem unreasonable? 1% is probably their costs, so they're gambling on less than 1 in 40 companies to default to make a profit? Actually, I really surprised it's that low. Is is secured against something? Quote Link to comment Share on other sites More sharing options...
Georgia O'Keeffe Posted October 25, 2011 Share Posted October 25, 2011 Nope - expansion not extension. We have successfully paid down the loan we had on our first business (at 1.5 over base) and would now take out another loan to set up the same type of business. you should consider that it is the BOE rate that is underpricing economic risk rather than the bank, (id have thought printing another 75Bn to supress rates should highlight that) Quote Link to comment Share on other sites More sharing options...
man o' the year Posted October 25, 2011 Share Posted October 25, 2011 That doesn't seem unreasonable? 1% is probably their costs, so they're gambling on less than 1 in 40 companies to default to make a profit? Actually, I really surprised it's that low. Is is secured against something? Yes - secured. Look at the change though. In less than 5 yrs. Last time I asked rate was less and is continuing to rise. Potential improvement in lifestyle is great and profit would be good so still tempted. Life has been on hold for property prices to fall and nose to grindstone for too long. May as well use deposit money in business. Quote Link to comment Share on other sites More sharing options...
19 year mortgage 8itch Posted October 25, 2011 Share Posted October 25, 2011 Merv: Hard to come up with any reasonable argument as to why inflation will not fall sharply next year. I await his wonderful hindsight Quote Link to comment Share on other sites More sharing options...
interestrateripoff Posted October 25, 2011 Share Posted October 25, 2011 http://www.telegraph.co.uk/finance/financialcrisis/8846201/Debt-crisis-live.html 10.30 Back to Sir Mervyn King at the House of Commons - he says whatever is decided at tomorrow's EU summit will not solve the region's underlying problems - it will only buy one or two years of breathing space...President Sarkozy will have a new target for his rage... Wow upto 24 months breathing space, he's feeling generous. Quote Link to comment Share on other sites More sharing options...
leicestersq Posted October 25, 2011 Share Posted October 25, 2011 Telegraph is reporting the following. "10.30 Back to Sir Mervyn King at the House of Commons - he says whatever is decided at tomorrow's EU summit will not solve the region's underlying problems - it will only buy one or two years of breathing space... " Does Merv suggest what is needed to resolve the underlying problems? I can only see bankruptcy as the solution, or is he suggesting anything else? Quote Link to comment Share on other sites More sharing options...
bobthe~ Posted October 25, 2011 Share Posted October 25, 2011 Yes - secured. Look at the change though. In less than 5 yrs. Last time I asked rate was less and is continuing to rise. Potential improvement in lifestyle is great and profit would be good so still tempted. Life has been on hold for property prices to fall and nose to grindstone for too long. May as well use deposit money in business. Last time, if 5 years ago, everything in the garden was rosy, and they would lend to anyone who could "fog a mirror". That was not normality. Normality is lending at a rate over the rate of inflation... Quote Link to comment Share on other sites More sharing options...
Biddyboy Posted October 25, 2011 Share Posted October 25, 2011 "When we undertook the next round of asset purchases, we did it because we thought there were real risks of inflation looking ahead falling below the target and we wanted to offset that." By this he means they printed more money because we think that inflation will go BELOW 2% in the future. I would have thought QE would have had the opposite effect? Quote Link to comment Share on other sites More sharing options...
TheCountOfNowhere Posted October 25, 2011 Share Posted October 25, 2011 The more I read the more corrupt they sound and the angrier I get. Quote Link to comment Share on other sites More sharing options...
madpenguin Posted October 25, 2011 Share Posted October 25, 2011 (edited) Mervyn King and Charles Bean are in front of the House of Commons Treasury Committee ............... When I read the start of this thread I thought it was going to be a joke, when I read further I realised it is,... but not a funny one Edited October 25, 2011 by madpenguin Quote Link to comment Share on other sites More sharing options...
R K Posted October 25, 2011 Share Posted October 25, 2011 The MPs are absolutely useless. No wonder Merv runs rings around them. It's like an adult talking to children – they're woefully uninformed. To be fair a child could run rings around that pile of sh1te. You'd imagine they might at least do some background reading. Imagine the sh1t we'd be in if they were actually running the country! Quote Link to comment Share on other sites More sharing options...
Traktion Posted October 25, 2011 Share Posted October 25, 2011 he just admitted the devaluation of the currency was intentional/needed. They aren't trusting his forward predictions, asking for a timeline on how inflation will get to 2% in a year Merv: Hard to come up with any reasonable argument as to why inflation will not fall sharply next year. Well there's one right there, by AteMoose. Only a liar would suggest that devaluing the currency wasn't going to have a knock on affect on the price of energy and the goods created using it. Quote Link to comment Share on other sites More sharing options...
Jason Posted October 25, 2011 Share Posted October 25, 2011 Merv getting angry at George Mudie – quite rightly so. He's way out of order – and wrong. What's Georgie saying? Quote Link to comment Share on other sites More sharing options...
Democorruptcy Posted October 25, 2011 Share Posted October 25, 2011 Merv: Hard to come up with any reasonable argument as to why inflation will not fall sharply next year. Oil was $100 a barrel in April but dropped 15%. Pump prices didn't drop. Yesterday oil went up 3.7% in a day. Today it has gone up another 2%. It's clearly going to be "unexpected" when fuel prices feed inflation in 2012 Then there is the extra 3p per litre fuel duty due Jan 2012 The detail of the Treasury's Budget Book spells out: 'The main fuel duty rate will increase by 3.02p per litre on 1 January 2012.' And there is another inflationary rise planned for next summer: 'The 2012-13 increase in fuel duty will be implemented on 1 August 2012 Read more: http://www.thisismoney.co.uk/money/cars/article-1716474/Budget-2011-Sting-in-the-tail-on-fuel-duty.html Quote Link to comment Share on other sites More sharing options...
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