Thursday, November 5, 2009

UK Rates remain on hold at 0.5% whilst QE is increased to £200 Billion

Extra £25bn to stimulate economy

The Bank of England's rate-setters have decided to pump an extra £25bn into the economy in their quantitative easing (QE) programme. They also kept interest rates unchanged at 0.5% for an eighth month. The Bank has already spent £175bn on QE, which involves printing money to buy assets from banks and other companies to stimulate the economy.

Posted by jack c @ 12:03 PM (1357 views)
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9 thoughts on “UK Rates remain on hold at 0.5% whilst QE is increased to £200 Billion

  • Where do I go then to collect my £830 for me and the missus

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  • QE currently being dabated on Radio 5 Live – general consesus is that QE has prevented economic situation getting worse – to get an improvement the next step would be to start purchasing assets such as Bank equities and…………………….housing.

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  • Jack C – please tell me nobody actually said they should buy housing…

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  • 3. timmy t – no the BOE could never make the informed selection choices the ‘private’ banks do on lending criteria instead they will by the MBS’s instead – sound familiar

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  • I am keen to purchase a property in the near future, but with all the government intervention I fear that prices will never drop to within a comfortable price range that past generations have benefited from i.e. a repayment mortgage over 25 yrs with a sensible monthly repayment, allowing me and my family live a little as well.

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  • timmy t – Victoria D interviewed someone (ex BOE official) just after the BOE announcement and the guy (didnt note his name but you can probably get a re-run of the show later today) stated that purchasing assets would be the best way forward and yes he specifically included housing.

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  • Jack C – what a knob – cos that’s worked so well up to now hasn’t it?

    Patient: “Doctor, I’m hooked on crack but every time I try to stop I feel dreadful”
    Doctor: “That sounds awful. I suggest you take more crack… here’s a prescription”
    Patient: “But I really think I should try and kick this habit”
    Doctor: “No no no… the important thing is to get rid of the symptoms, not cure the problem.”

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  • timmy t – you really must also listen to the Radio 5 live debate just after the 1.00pm news where they question the use of QE – just like the crack addict you describe they actually stated that they currently have (1) no idea if it’s working (2) if it’s not working whether in due course it will work (3) Once the QE process started it’s going to be very difficult to stop (4) if they find it hasnt worked it will all have been a waste of time

    You really could not make this stuff up !

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  • timmy t,

    Funny thing is that is how many problems are “treated” in the medical world, as long as the Doctor’s salary is artificially inflated ( though government regulation ), the drugs make the patient feel better ( or at least thinks it the best alternative ) and the drugs companies have a new repeat customer who can only go to them for the next 50 years ( again through regulation ) then “everyone’s a winner” ( well, apart from the patient, who could have got her “depression” sorted out by three trips to an osteopath [ or whatever ] ).

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