Mark Carney: I Will Inflate And Destroy The Pound

[200p]

If there is massive inflation, creditors will want higher interest rates to compensate. Fix debt and get out of debt, is, maybe a middle way through this.

[zugzwang]

Goldman Sachs is forecasting Brent crude @ $150bbl this summer.

Make of that what you will - the Squid falsely called oil @ $200bbl in 2008 - but it sounds plausible to me. Demand is rising in China and the US again, the ability to satisfy it increasingly constrained by war or revolution across the whole of North Africa and in most of the Middle East. The marginal cost of production continues to rise as producers go over their individual production peaks and will remain stubbornly unimproved by the bogus panacea of shale. The world's central banks are providing the markets with almost infinite liquidity with which to speculate.

An inflammatory cocktail. The only way is up.

[Guest unfunded_liability]

I wonder if this change in target will open the door for wage inflation?

Thoughts anyone?

Wage inflation, if it happens at all given rising unemployment, mass immigration, offshoring, outsourcing, oh and a global slump in consumption, will significantly lag price inflation.

[erranta]

Dyson moved to Malaysia, Twinings to Poland IIRC. Sure we can have massive wage inflation but then the jobs will be exported, so no there can't be wage inflation unless eg Malaysia and Poland have greater wage inflation. There will be a wage inflation in the public sector but the private sector has competition and will therefore depend on the competition. For low level hands-on jobs then we have imported labour who will do that work at less than minimum wage.

Growth by printing and inflation is not real growth. GDP may well increase but 99% of the population will be much worse off ... which by the way is the plan.

The fun thing to this end-game is no one will buy their products cos they won't have the cash available at the prices they want to ask

- so they will go out of business in rip-off UK anyway

[Damik]

Pound to Euro: 1.1648

Any idea, what is the main driver and how low it can get? Do the markets realise that the UK is a toast ??? Any inside info?

[LeeT]

Pound to Euro: 1.1648

Any idea, what is the main driver and how low it can get? Do the markets realise that the UK is a toast ??? Any inside info?

My guesses. I'm not an insider though.

I think it's because the Euro has been saved and their healthy banks are paying back some of the LTRO money.

Meanwhile it snowed in the UK meaning we'll be in recession when Q1 2013 GDP figures are released. We're going to lose our AAA rating.

Edited January 28, 2013 by LeeT

[Hywel Dda]

Bernanke to Oprah: "I've Been Doping for Years

Edited January 28, 2013 by Hywel Dda

[sombreroloco]

I'm sorry but if there's no gratuitous female nudity I refuse to watch Youtube.

[Damik]

Pound to Euro: 1.1648

Any idea, what is the main driver and how low it can get? Do the markets realise that the UK is a toast ??? Any inside info?

http://finance.yahoo.com/echarts?s=GBPEUR=X#symbol=;range=5d;compare=;indicator=volume;charttype=line;crosshair=on;ohlcvalues=0;logscale=on;source=undefined;

Pound to Euro: 1.1588 (1.235 in the middle of December - 6.5% down)

should we expect parity with Euro in Summer?

[Toto deVeer]

Why such a concentration on liquidity? IMO he will have no choice but to raise interest rates initially to establish credibility on the international stage. Later on he can trash, if he so wishes.

The 25% drop in the value of the pound/dollar and drop against the Euro has had little or no benefit on exports. What he needs to do is attract international investment. This is best done with a upward interest rate bias.

[zugzwang]

If Brent crude continues its run up then an all-time sterling high can't be far away.

The rolling average must be setting fresh highs on a weekly basis already.