Monday, July 9, 2007

Darling’s Conflicts of Interest

Stephen King: A reminder to Mr Darling as sterling keeps on rising

In 1994 Mr Darling highlighted a conflict of interest which would always occur as a result of granting the BoE independence. The then Labour Opposition opposed the motion, raised by the Tories (Nicholas Budgen MP) to grant the BoE independence. In the light of increasing interest rates upon an indebted nation, is the Labour Government starting to loose its love for an independent BoE?

Posted by talking rot @ 04:51 AM (409 views)
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3 thoughts on “Darling’s Conflicts of Interest

  • Interesting latter part of this article:

    “…Another alternative would be either to raise the inflation target or, instead, widen the letter-writing range. By creating a bit more flexibility on the inflation rate, there’d be a bit more discretion on the exchange rate. Mr Darling’s reputation, though, would be damaged by such a move. His predecessor in effect got away with it when he shifted from a retail price to a consumer price target, but I can’t see the same ruse being repeated, particularly when inflation is already elevated…”

    Looks like they will change the inflationary goalposts of course (not that they haven’t already of course surreptitiously). This will mean anyone with savings gets shafted again…

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  • This clearly naive analysis ignores the fact that the Treasury absolutely controls the BoE, although not officially. This will also be the case with the other “powers” Gordon will ostensibly be giving away………

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  • No, but it may be “losing” it?

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