Bank of England & QE

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SimonThe government could raise taxes, or B of E raises interest rates to reduce the demand for commercial bank credit money if their are any inflationary fears. The heart of the problem is a lack of understanding amongst most MPs, Ministers and many economics commentators as to where money comes from, a...

1 weeks ago

SimonYoung tend to borrow, older save or receive proceeds from a house sale, often which a young person has borrowed to pay for. The commercial banks as a group greatly increased the money supply with much more lending between 1970 and 2007, inflating house prices by more than 25 X. The future for young ...

1 weeks ago

James MurrayHi David,This level of debt certainly is worrying.I note the letter to Philip Hammond http://positivemoney.org/lette... This again urged him on the path of Sovereign Money Creation and then injecting it into the real economy - citizens’ dividend, house building infrastructure investment to reduce...

2 weeks ago
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Vince RichardsonYes one gets te feeling that this is the state coming in to join the party.My guess is that they will eventually want to be the only guest,it would be hard to control the money supply if you don't control the money issue.So the likes of Bitcoin will likely be banned or restricted in some way....

6 days ago

SimonThe commercial banks issuing credit model, to get money into the economy, is not sustainable given ageing societies, and automation. It requires growing younger populations to continue to take on more debt, to help pay for pensions and people not working. Creaking public health care, and declining s...

3 weeks ago

medialAxis"A central bank issued digital currency, on the other hand, would be an extension of cash – a direct claim on the central bank. It would, by definition, be fully protected from default."But not from negative interest rates, I suspect. So it's not digital cash at all. Cash does not require a truste...

3 weeks ago
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Marco SabaJust another option is GOVERNMENT LEGAL-TENDER NOTES. Here Lindbergh: https://www.scribd.com/documen......

3 weeks ago

James MurrayConrad,'Help to buy' is a great stimulant to the economy if it is wholly and soley confined to new build houses.Of course, the problem arises when the house vendors raise their prices as a result and so sucknup all the good.Jim Murray...

3 weeks ago

ConradJonesAnother crazy Policy of the Government has been the Help-To-Buy scheme, which requires public funds to operate. This scheme, which help divert funds from other more productive activity (i.e. Education and Infrastructure) has helped laiden the public with additional National Debt but also the liabili...

3 weeks ago
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To be made sick by medicine: Quantitative easing and inequality after the financial crisis

Screenshot 2016-12-12 13.34.40

The sustenance of economic systems often relies on delicately balancing two perilous extremities. When looking at inequality, for instance, one finds that the lack of it will lead to an economy’s atrophy, while its excess may lead to unsustainable tensions. Since the end of the most recent financial crisis, developed countries have been inclined towards the latter scenario.

SimonAnd the banks themselves were increasing house prices by extending more credit. Eventually the system collapses as people cannot repay. At the height of the mania in 2004, I could have an auction in my front room, as people were desperate to buy my fairly ordinary house. Every property at the local ...

last month

Vince RichardsonThanks for the post,it is as we all expected.I did like this sentence," More recently, inequality has been rounded up in the lengthy line-up of factors accused of provoking the Global Financial Crisis"I concur with that view.Sub prime or selling mortgages to lower/middle income borrowers was a huge ...

last month
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Marco SabaThat the liability of the central bank is a fake liability is a well recognized fact among academics. Here: Seigniorage, W. Buiter, 2007: http://eprints.lse.ac.uk/19733......

last month

RJif the UK Govt deficit spends itDEBIT ExpenseCREDIT ????????????????????If a bond is issued to either the market or the BoE = debtCREDIT Bonds issued (DEBT?)But what if a bond wasn't issued and the treasury just had a reserve overdraft at the BoE. That the treasury paid interest on. Is this really a...

November 2016

RJ"There can be no net savings"Only if you exclude Government bonds held by for example pension funds. And why would you do this. As you pointed out"The liability is measured by bonds in issue."Agree. But here is a point that many overlook. This can include Govt bonds held by the non bank sector. Or b...

November 2016
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