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When Will Quantitative Easing Be Announced?


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To get interest rates to 2% they must already be using Quantitative Easing. (buying northern rock by definition is quantitative easing, as is buying shares in RBS).

If BOE cut to a US style 'zero to 0.25% range' then they would be literally fly-tipping bags of notes at the doorsteps of banks.

how much easing are you looking for?

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To get interest rates to 2% they must already be using Quantitative Easing. (buying northern rock by definition is quantitative easing, as is buying shares in RBS).

If BOE cut to a US style 'zero to 0.25% range' then they would be literally fly-tipping bags of notes at the doorsteps of banks.

how much easing are you looking for?

explain: Government buys something = QE.

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Guest Steve Cook
did you notice the oil price today? couple more days like that and they won't be citing the collapse in the oil price as a reason for falling inflation.

yep...over 23% in a day

Anyone going long will have made a sh*t load of money today

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Guest Steve Cook
explain: Government buys something = QE.

we know here the money is going that the government has spent. Into the economy. Or at least, that's the plan.

That money either comes from existing coffers or it comes from nowhere, to be paid for later by our descendants. Either way, the government has "eased" the money supply in circulation right now.

Quantitative Easing = Inflating

Fundamentally, these terms are synonymous

Edited by Steve Cook
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we know here the money is going that the government has spent. Into the economy. Or at least, that's the plan.

That money eiother cvomes from existing coffers or it comes from nowhere, to be paid for later by our descendants. either way, it has "eased" the money supply in circulation right now

Are you saying then that BLOO LOO buying something = QE too?

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Guest Steve Cook
Are you saying then that BLOO LOO buying something = QE too?

in principle, yes

Quantitative easing means bringing more money into circulation.

This can be achioeved by increasing the velocity, decreasing the amount that is hoarded, or simply by increasing the supply in absoloute terms byby printing

Edited by Steve Cook
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Guest Steve Cook
so QE means people buying things.

So why would we need an announcement of an everyday, totally normal, happened for thousands of years, event?

Because when you and I quantitively ease the money supply by spending some of our money, it is quantitively contracted when the shop keeper saves it. Similarly, we quantitively contract the money supply when we put our wages aside prior to spending it. In other words a zero-sum (discounting velocity...of course)

When the government spends money it is not a zero-sum unless they are using previously collected taxes. But, even then, it is only zero-sum in the very longer term. In the short term, injecting a large amount of previously hoarded tax revenue will, until it is recovered by future raised taxes, quantitavely ease the money supply. If they are using previously non-existent money that they are borrowing from the future, it is undiluted, undisguised, uniquivocal easing.

Edited by Steve Cook
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Guest Steve Cook
I voted never because it will probably just happen, it won't be 'announced' as such.

I agree

If they can manage it, we wont get to know formally

If it all goes tits up and they have to take dramatic and large action over a short time frame, they will not be able to disguise their actions and so then we will get an "announcment"

Edited by Steve Cook
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Because when you and I quantitively ease the money supply by spending some of our money, it is quantitively contracted when the shop keeper saves it. Similarly, we quantitively contract the money supply when we put our wages aside prior to spending it. In other words a zero-sum (discounting velocity...of course)

When the government spends money it is not a zero-sum unless they are using previously collected taxes. But, even then, it is only zero-sum in the very longer term. In the short term, injecting a large amount of previously hoarded tax revenue will, until it is recovered by future raised taxes, quantitavely ease the money supply. If they are using previously non-existent money that they are borrowing from the future, it is undiluted, undisguised, uniquivocal easing.

I was under impressions the term QE was a euphamism for Printing, not normal economic acitivity.

The FED will QE by giving banks M0 for only a promise to repay, no supporting asset to counter or interest to pay.

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Guest Steve Cook
I was under impressions the term QE was a euphamism for Printing, not normal economic acitivity.

The FED will QE by giving banks M0 for only a promise to repay, no supporting asset to counter or interest to pay.

I think we all get too hung up on the distinctions between printing, buying and selling teasures, lowering and raising taxes and god knows what other mechanisms are used by government to control the money in circulation

They are all designed to have the same effects, at the end of the day. Sure, some are more powerful and immediate tools than others. But, that is all.

If the government inflates the amount of money in circulation, then they have inflated the amount of money in circulation.

In other words, the have "quantitavely eased" the amount of money in circulation. The specific mechanism by which they achive this is of operational interest but not of principle interest.

Edited by Steve Cook
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I think we all get too hung up on the distinctions between printing, buying and selling teasures, lowering and raising taxes and god knows what other mechanisms are used by government to control the money in circulation

There are all designed to have the same effects. some are more powerful and immediate tools than other is all. If the government inflates the supply of money in circulation, then they have inflated the amount of money in circulation. In other words, the have "quantitavely eased" the amount of money in circulation.

The government puts money in the system by issuing bonds which banks buy, earning interest and exchange for Cash at the BoE if they wish.

QE must shortcircuit this method and the money is just introduced and not backed by debt.

Edited by Bloo Loo
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Guest Steve Cook
The government puts money in the system by issuing bonds which banks buy, at interest and exchange for Cash at the BoE if they wish.

QE must shortcircuit this method and the money is just introduced and not backed by debt.

If the governemnt issue bonds, the debt is overt and visible.

If the government prints money the debt is covert and invisible (future taxes)

They are both still borrowings from the future. As such, there is no fundamental difference

Edited by Steve Cook
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If the governemnt sells bonds, the debt is up front and visible.

If the government prints the debt is covert and invisible (future taxes0

They are both still borrowings from the future. there is no fundamental difference

in line 2 you say they print (future taxes)

BUT, as this is debt free money, why would they need tax revenue to cover it. It is truly, thin air money.

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