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Boe Meeting Today. -- multiple threads merged


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Sky reports economists think Gorgeous Mark's possible QE or further ludicrous cutting of interest rates would "pull Britain out of the doldrums".

Sir Mervyn pointed out last week that while his Canadian successor may be more "persuasive", he only holds one vote on the MPC.

Some economists expect that Mr Carney will begin to take action to pull the UK out of the doldrums from August.

Vicky Redwood of Capital Economics said he was likely to introduce "forward guidance", which helps reassure markets that interest rates will remain low in the future while she predicted there was a 50% chance of QE also being resumed.

http://news.sky.com/story/1111397/stronger-economy-puts-brakes-on-carney

Like another line will help the addict.

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trade deficit ... ??? so last century like 'balance of payments' get with the new paradigm 'GDP growth' is the new maxim ... we can put trade deficit in the same 'to do later' box :lol:

whilst I agree with your sentiment, changing the GDP to suit an agenda when Imports are such a big part of it might wake a few people up

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Yes. This is all part of the new policy of forward guidance, to attempt to lessen the impact of any changes in QE or IR.

Certainly for me though this just confirms what I think (and what I think most people on here say). The "recovery" is weak, they can't raise IRs or stop QE or they will wreck it. But if the US raises rates they will have no choice. There is no alternative to QE here except massive cuts in spending. These will be hugely unpopular and the position seems to me to be totally dictated by Obama rather than Cameron.

Not Obama or Cameron, but the market. Bernanke, Carney et al will be forced to stop printing when the global debt carrying capacity has reached maximum, which appears to be close. Liquidation and deleveraging must then resume in earnest. Tick tock.

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Many a true word is spoken in jest:

Winston Churchill on economists, specifically on JMK (John Maynard Keynes) "If you put two economists in a room, you get two opinions, unless one of them is Lord Keynes, in which case you get three opinions."

Leo Dumpmen on economists, specifically those on the MPC (Monetary Policy Committee) "If you put the nine members of the MPC in a room, it's irrelevant whether you end up with one opinion or ten because any opinion is just an opinion: the policy they actually adopt has already been decided - by Goldman Sachs!"

History will judge the decade from 2008 as 'THE GREAT REPRESSION'. A time when the prudent were sacrificed

to bail out the reckless and the feckless. A time when the very notion that Britain's was a truly democratic nation

was proven to be a sham - Britain is a kleptocracy, a society run by the elite for the elite:

Below inflation interest rates for savers - tough.

Lousy annuity rates for those prudent enough to save for retirement- tough.

House prices being inflated away from affordability by funny money- tough.

And perhaps worst of all, mortgaging the wealth of future generations to pay for the criminal mismanagement of the economy by the present and previous Governments - tough.

THE GREAT REPRESSION. read

http://www.economist.com/node/18834259

http://en.wikipedia.org/wiki/Financial_repression

(Successive governments between the 1940s to 1970's intentionally inflated away the debt of WW2. Given that generations suffering tax/inflation AFTER the warbenefited from the sacrifice of the 40's generation there was perhaps some moral justification for this? But can we honestly justify this policy now -for the debt incurred in the first decade of C.21st ?)

Open peoples minds by using the term THE GREAT REPRESSION when ever possible. Lets try and make the term part of the lexicon for 2013!

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Merv said,in around 2008, that problems in the shadow banking "sector" shouldnt affect the real economy...he was wrong.

Today, Draghi says: DRAGHI: IMPROVEMENT IN FINANCIAL MARKETS SHOULD REACH ECONOMY

He has been wrong since he started. notice the word SHOULD.....the words before that are wishful thinking.

Edited by Bloo Loo
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The position is the same in America. There is no recovery. They have boxed themselves in and don't know what to do.

You wouldnt know it listening to Stephanie Flanders on the BBC. According to her we're awash with the obligatory 'green shoots' and the yanks are in some gilded era.

Listening to BBC economics news is like waking up in the twilight zone.

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Max Keiser - what he expects Carney to say/do: http://rt.com/op-edge/carney-bank-england-keiser-499/

Mark Carney, the former head of Bank of Canada will, I predict, in his new role as Governor of the Bank of England, double down on Quantitative Easing and buy more UK Gilts (government bonds) than any previous Bank of England chief.

Edited by Errol
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Houses wont interest him particularly...he has a stupendous income, probably millions in savings, and doing good for the "system" will earn him a place on Elysium.

You underestimate the greed of these people. Remember the Swiss chap, who used to be "the world's top central banker" before Carney inherited the title by default.

http://www.bbc.co.uk/news/business-16472416

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You underestimate the greed of these people. Remember the Swiss chap, who used to be "the world's top central banker" before Carney inherited the title by default.

http://www.bbc.co.uk...siness-16472416

I dont recall that..thanks...I note he is quoted as saying he felt he was a damn good central banker....20% devaluation is great for business.

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I dont recall that..thanks...I note he is quoted as saying he felt he was a damn good central banker....20% devaluation is great for business.

Nice piece in the ST a few months back about how business was just using the currency weakness to profit take/stash more cash rather than invest in new kit/employees.

Pushing on a piece of string and all that.

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The yes and no man...

http://www.standard.co.uk/news/uk/new-bank-of-england-governor-mark-carney-rules-out-early-interest-rate-hike-8688455.html

New Bank of England governor Mark Carney ruled out an early hike in interest rates today.

The article goes on to list various experts saying that today's hold indicates interest rates will go nowhere etc.

This of course knocked GBP down, despite some economist on one of the business TV channels saying earlier in the afternoon that the BoE decision would not harm sterling "as no further QE was mentioned".

The newswires are full of IRs won't be rising commentaries.

Yet, yet, yet just last week we had this alleged comment carried in the press:

http://www.dailymail.co.uk/news/article-2348576/Mark-Carney-Get-ready-mortgage-rate-rise.html

Canadian Mark Carney, who takes over from Sir Mervyn King on Monday, told ITV News a rise was on the cards, adding: ‘Without doubt they need to manage their business for the possibility of a slight or material change in the level of interest rates.’

Today, we have ITV news saying the opposite: http://www.itv.com/news/2013-07-04/mark-carney-hints-interest-rate-might-not-rise-for-some-time/

It's a hint that the Bank is minded to tell us next month that it won't raise rates for some time - which would be a promise that cheap borrowing will continue.

But, wasn't it reported he'd said nay to the BofE governor job, not long ago? http://www.telegraph.co.uk/finance/economics/9465334/Mark-Carney-rules-himself-out-of-Bank-of-England-governor-race.html

Mark Carney rules himself out of Bank of England governor race

The list of potential candidates to become the next Bank of England governor appeared to further shrink as Mark Carney, the head of Canada’s central bank, ruled himself out of the race.

and so

http://www.theglobeandmail.com/report-on-business/international-business/european-business/bank-of-england-holds-steady-on-rates-stimulus-in-carneys-first-vote/article12981275/

The statement prompted the British pound to fall more than one cent against the U.S. dollar to $1.51, the lowest level since May and sent the London Stock Exchange up. The bank’s commentary “is pretty aggressive stuff that has prompted a sharp move lower in sterling and suggests that Carney is very much in the dovish camp,” said James Knightley an economist at ING Bank in London.

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Edited by inflating
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Max Keiser - what he expects Carney to say/do: http://rt.com/op-edg...and-keiser-499/

Mark Carney, the former head of Bank of Canada will, I predict, in his new role as Governor of the Bank of England, double down on Quantitative Easing and buy more UK Gilts (government bonds) than any previous Bank of England chief.

Unless the rest of the world blows up first. He can't spend it all on gilts though, that would push the national debt up too far. He'll use it to purchase MBS and assorted crap from the banksters. By making FLS/HTB semi-permanent he and Osborne might be able to informally create the UK equivalent of Fannie and Freddie...

Desperate times. Hopefully the ratings agencies will take a dim view.

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Desperate times. Hopefully the ratings agencies will take a dim view.

I wouldn't bet on it.

Sounds like some horrendous economic paradox machine they have created though, ever more government debt, ever more QE, over more asset inflation, ever more wealth transfer to the 1%.

Edited by Secure Tenant
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We all know George Osborne's famous quote about QE when he was in opposition. But here's another from the dynamic duo, courtesy of Save Our Savers

George Osborne, March 2009: “Action is needed to help savers. At the moment, income from savings in bank accounts suffers from double taxation – the money is taxed when you earn it and then any interest is taxed again. For basic rate taxpayers, this unfair double taxation of savings should be abolished.”

David Cameron, January 2009: “We need to make a really big change: from an economy built on debt to an economy built on savings, from a country and government that has lived beyond its means to one that lives within its means.”

George Osborne delivering his Budget on March 20th, 2013: “A Budget for those who want to save for their retirement.”

Very little has appeared in the press today about the measures in the Budget intended to help savers, boost the UK’s savings culture and reduce the country’s indebtedness. So we thought we should list them all here:

Here ends the list.

Today's no move on IRs shows their words are worth their weight in the shiny yellow stuff (custard).

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I wouldn't bet on it.

Sounds like some horrendous economic paradox machine they have created though, ever more government debt, ever more QE, over more asset inflation, ever more wealth transfer to the 1%.

The problem for Carney is that he can't simultaneously run up inflation and keep gilt yields suppressed. If gilt yields rise then mortgage rates will rise too which will require an even greater QE subsidy to keep the housing market upright. The paradox ultimately resolves in a hyperinflation if it isn't stopped.

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There are old articles from Q1, but am mentioning them now because I suspect savers are screwed unless gilts rise and QE can't be used to douse the rise. Apologies if already posted.

http://www.telegraph.co.uk/finance/personalfinance/interest-rates/9922941/Interest-rates-predictions-Four-more-years-of-0.5.html

Coutts, the Queen's bank, has warned that monetary policy committee (MPC) may not increase Bank Rate from 0.5 per cent until 2017.

http://www.telegraph.co.uk/finance/personalfinance/interest-rates/9888611/Interest-rates-predictions-Why-Ill-keep-betting-on-low-rates.html

For my part, I have flocked with the interest rate “doves” since the crisis began. I’ve stuck with a lifetime “tracker” mortgage despite the temptations of falling fixed rates. After further falls in recent weeks, taking a fix would now add only a quarter of a percentage point to my rate, plus the costs of remortgaging, in exchange for two years’ peace of mind. It’s simply not worth it.

None of this is what savers want to hear, and not what they deserve.

Their predicament has been worsened by the £80bn Funding for Lending scheme, which hands cheap money to lenders. It has pushed down savings rates as much as it has the cost of loans. With the scheme far from exhausted, savers could face more of the same.

Sibley must be smiling to himself wherever he is. For the most part, he was right, and the government indeed didn't let it happen (for London and large swathes of the British Isles, not so far at least). I can recall many of us thought the blue team would bat more fairly, but now we know it's the same old rubbish, or LabourTory, as someone else called them

Actually, the Funding For Lending, which has completely smashed savers' returns, was probably just Osborne's idea. Let's be fair.

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  • 418 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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