Wednesday, June 29, 2011
Coded uttering from King
"Beleaguered Britons are likely to keep their hands in their pockets for at least the next year as high inflation eats into their living standards, the Bank of England governor, Mervyn King, has warned." So King says that high inflation is repressing economic growth. Yet highly inflated living costs might be at least partly attributed to ZIRP. Can you spot the circularity? Interestingly, King also "rejected the claim this week that the a tsunami of house repossessions would hit the UK if interest rates were to rise significantly. He said it was unlikely mortgage lenders would raise interest rates in line with rises in the base rate set by the Bank of England." Was that a hint to mortgage lenders?