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TheCountOfNowhere

Ex-Mpc Member Says Rates Will Stay Low Until 2021

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I still find it so hard to come to terms with how, in such a short space of time, everything has been turned completely upside down... at one time someone like me, prudent, cautious, sensible with money would have been treated like royalty by the banks and they would have been fighting each other to gain my custom. Whilst the over indebted, feckless spendthrifts would have been turned away at the door.

Now I'm regarded as worthless scum whilst the debt junkies are welcomed with open arms.

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"We cut rates in November 2008 by 150 basis points (1.5%). It was clear that we should have cut by more but didn't because of the panic that it might have caused," he said

Nonsense. The bubble of phantom equity in the housing market needed to eliminated. By cutting precipitously, Dummy and his chums helped fix it in place. Its malignant presence has remained with us ever since.

Edited by zugzwang

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The Fed will carry on riasing, the US economy will get better - people die, new capital form.

The EU and UK will struggle all, dripfeeding low IRs to thezombie companies and households.

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I knew it would be Blanchflower.

Yes. We have Brown to thank for given that other idiot the titile 'ex member of the BoE'

Frankly, any person assoicated with the Boe, FSA and Treasury from 2000-2010 should be treat like a fkcing idiot leper.

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This is a test of the faith in money surely.

As long as this faith holds the rates can stay low for quite a while.

When the faith breaks we will get hyperinflation and in short order, I think of it as a multi trillion £ game of pop up pirate and we are still sticking swords in. As a politician you stick your sword of debt in and retire a hero, but some poor ******* is going to get it big time.

Once property crashes what will you be able to buy that provides a return? Its the sponge that its sucking up the excess. Once property crashes and if democracy holds the disenfranchised will vote for tariffs etc and possible capital controls which will really bugger some of this debt up.

If nothing changes then the end game as many have said on here is everyone pretty much having a purchasing power equal to the lowest practical global provider of the same service. Mass immigration and Turkey joining the EU are part of this process the leaders think to prosper they need to get ahead of the curve of cheap labour and demographics.

No wonder it looks like Trump is doing well, 4 million voted for UKIP etc the natives are clicking that they are the boiling frogs.

I would not be making bets till 2021 things feel they are speeding up behind the scenes.

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This is a test of the faith in money surely.

As long as this faith holds the rates can stay low for quite a while.

When the faith breaks we will get hyperinflation and in short order, I think of it as a multi trillion £ game of pop up pirate and we are still sticking swords in. As a politician you stick your sword of debt in and retire a hero, but some poor ******* is going to get it big time.

Once property crashes what will you be able to buy that provides a return? Its the sponge that its sucking up the excess. Once property crashes and if democracy holds the disenfranchised will vote for tariffs etc and possible capital controls which will really bugger some of this debt up.

If nothing changes then the end game as many have said on here is everyone pretty much having a purchasing power equal to the lowest practical global provider of the same service. Mass immigration and Turkey joining the EU are part of this process the leaders think to prosper they need to get ahead of the curve of cheap labour and demographics.

No wonder it looks like Trump is doing well, 4 million voted for UKIP etc the natives are clicking that they are the boiling frogs.

I would not be making bets till 2021 things feel they are speeding up behind the scenes.

Yes.

I find the likes of martin Wolf saying 'the cost of government debt is very lowand they should borrow'

That would be fine if the gov was investing in productive capacity or infrastructure.

Its not - its being p1sed awy on TCs for nail bars and hairdressers.

Markets are wrong.

Look at the share price of Enron.

Look at the price of Greek debt before the crisis.

Things change And they they do you'd better hope they dont swing to far against you.

Look at the stuturring in the cover of Gilts recently.

There's no rich Oil state looking to launder its ill gained money anymore.

Chinas is starting to suck in money and look for a better return.

Yes, there is is the paradox of thrift.

But there's also the paradox of debt - it all governments a borrowing whos going to lend?

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Unlike Carney, Cunliffe and the other main central bankers Blanchflower isn't on the board of the Bank for International Settlements (BIS) so he isn't really expected to know any better (evidently he doesn't read their reports - just trouser the money as an ex member of the BoE and MPC).

That's the BIS that has admitted that the ZIRP and QE policies have failed and don't work. So the other central bankers who are on the board of the BIS should explain to him that he's touting policies already shown to have failed. Policies tht have wrecked the wrecked UK economy some more and continue to do so and make it far far worse.

He's touting failed policies but for sure he knows that those self same policies help to line the central bankers and the cronies pockets. I imagine some would say that he's one of those in the latter category - or at least lots of his associates are.

Edited by billybong

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The Fed will carry on riasing, the US economy will get better - people die, new capital form.

The EU and UK will struggle all, dripfeeding low IRs to thezombie companies and households.

The US economy is not getting better and the Fed will trigger a dollar debt crisis forcing the Fed to reduce rates.

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As he's an advisor to Corbyn at least that also gives another indicator of the likely policy direction if the Labour wing of the LibLabCon get in or at least up to 2021

Edited by billybong

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From the guardian link


Professor Blanchflower described the backdrop to the committee's decision in March 2009 to cut rates to 0.5% as catastrophic. He said the MPC at the time had wished to avoid a death spiral.

:lol::lol::lol:

Oh come on pull the other one.

Ex BoE governor King has already admitted that the crash was deliberate and now Blanchflower wants to try to claim that it was all unexpected. Doesn't he look at the news at all these days. Does he just spend his time watching X Factor or something.

Corbyn does pick 'em.

Edited by billybong

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I have my doubts about this. The distortions brought about by years of low interest rates are now all too apparent. It's not only house prices that have been affected but all types of financial assets. Along the way pensions have been trashed and the insolvency of many insurers is in question. The unintended, perverse and malign consequences are mounting by the day.

The problem is that both public and private debt continues to grow and this debt can only be afforded with low interest rates. The unstated assumption of policy is that with every month of low interest rates we are getting that much nearer to "normality"; in fact we are getting further away from "normality" because the debt continues to grow; we are digging the hole ever deeper. The equilibrium rate of interest which balances savings with investment is getting lower not higher.

This is a Ponzi scheme and they go with a bang not a whimper. I have doubts whether this particular one will survive until 2021.

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http://www.bbc.co.uk/news/business-35731957

Interest rates will likely fall further in Britain and remain at near record low levels until 2021, a former Monetary Policy Committee member says.

HPI running at 10%....

IMHO The bankers need to be tried for treason.

What I would give to have just two minutes alone in a room with one of these dangerous (and intellectually arrogant!) ivory tower academics!

Wouldn't solve anything I know. But would make me feel a damn sight better.

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I still find it so hard to come to terms with how, in such a short space of time, everything has been turned completely upside down... at one time someone like me, prudent, cautious, sensible with money would have been treated like royalty by the banks and they would have been fighting each other to gain my custom. Whilst the over indebted, feckless spendthrifts would have been turned away at the door.

Now I'm regarded as worthless scum whilst the debt junkies are welcomed with open arms.

Brilliant statement, so good i've tweeted it for you.

Ccyuf1kWAAAxBfv.jpg

Edited by TheCountOfNowhere

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Well Blanchflower has a record for getting it 100% wrong. I now wouldn't be surprised if rates rose within a few months

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I still find it so hard to come to terms with how, in such a short space of time, everything has been turned completely upside down... at one time someone like me, prudent, cautious, sensible with money would have been treated like royalty by the banks and they would have been fighting each other to gain my custom. Whilst the over indebted, feckless spendthrifts would have been turned away at the door.

Now I'm regarded as worthless scum whilst the debt junkies are welcomed with open arms.

I can confirm this from my recent car buying experience- as cash buyer I was about as welcome at the car dealerships as a fart in a spacesuit- they need debt zombies to rake in those commissions from the finance companies- which meant my actual cash was more an inconvenience than an asset in their eyes.

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Assumes this can last until 2021. 5 more years of ZIRP/NIRP? We going to have government debt paying -5% or something? These idiots have no end game.

The end game SHOULD be effective restructuring of the economy. But central bankers can't do that and the current govts attempts are half baked.

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I can confirm this from my recent car buying experience- as cash buyer I was about as welcome..... as a fart in a spacesuit- they need debt zombies to rake in those commissions from the finance companies- which meant my actual cash was more an inconvenience than an asset in their eyes.

Brilliant. Consider that one nicked!

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I can confirm this from my recent car buying experience- as cash buyer I was about as welcome at the car dealerships as a fart in a spacesuit- they need debt zombies to rake in those commissions from the finance companies- which meant my actual cash was more an inconvenience than an asset in their eyes.

Brilliant observation. This is what keeps UK growth going. Eliminate cash purchases. Buy everything using dodgy financial products. Create mis-selling industry. Hand out free compensation through nationalised banking industry. There probably doesn't need to be an end game so long as everyone plays the game. This has added billions to GDP.

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