printing money what does it mean

drex_123

Hi can anyone explain in laymans terms what this means. I am confused about inflation, deflation and what effect this will have on the ordinery joe. In particular how it could effect my 100k from the sale of my house that is sitting in the bank earning very little. I have been holding out for the right house at a resonable price but don't know if i should be looking at buying just to protect money or if i can afford to wait for one that my family and i are happy with. I feel like many others penalised by Brown & co for being responsible ie paying mortgage off, no debt, being a saver.Would be grateful if someone could help me understand implecations of QE so i can make decisions Thanks

Pssst

The money supply is like everything else. Its a commodity. If there is more of it around,then potentially,the pounds that are in circulation are worth less. Just like shares. If a company issues more shares,the ones in circulation go down in value.

Quantitative Easing is just a smokescreen. a clever phrase to blind the proletariat. Quantitative simply means amount and easing means...well hey lets increase the money supply in the hope that it will stimulate spending and kickstart the economy and to hell in a hand cart with all the savers whos hard work is going down the pan.

see
http://en.wikipedia.org/wiki/Quantitative_easing


QE will be the final nail in the coffin of the British economy.

drex_123

Thanks pssst i get what QE means in terms of what it is. Just dont get the effect it could have on my savings what i should be watching for etc, is it likely that it could all go wrong and they could be worthless. Hope that makes sense just trying to get my head round it all. I feel i AM BEING FROG MARCHED TO THE BANK TO SPEND SAVINGS when all i want is time to find a home at a fair price

ad9898_3

Pssst wrote: »

QE will be the final nail in the coffin of the British economy.

Correct, I'm sure Gordon must have looked and saw how well it worked in Japan and Zimbabwe.:rolleyes:

gecko

I am in a similar position, no debts and have saved for the past 5 years to buy my first house. I am now wondering where to put all my savings to keep them safe (shares, gold) or just buy the house at the exorbitant prices here in the South East!

Guy_Montag

drex_123 wrote: »

Thanks pssst i get what QE means in terms of what it is. Just dont get the effect it could have on my savings what i should be watching for etc, is it likely that it could all go wrong and they could be worthless. Hope that makes sense just trying to get my head round it all. I feel i AM BEING FROG MARCHED TO THE BANK TO SPEND SAVINGS when all i want is time to find a home at a fair price

Like me, you're increasing your purchasing power by 15-20% pa. if you use your savings to buy a house. If you use them for something else then you're in trouble.

Having said that the govt. has said quite frankly that they want you to spend spend spend. VAT cut, low interest rates & now deliberate inflation.

ad9898_3

gecko wrote: »

I am in a similar position, no debts and have saved for the past 5 years to buy my first house. I am now wondering where to put all my savings to keep them safe (shares, gold) or just buy the house at the exorbitant prices here in the South East!

Well, not houses, even if your money earns 0%, houses have lost nearly 18% YoY, as for shares, mmmm there is a way to go yet in my opinion and gold ??, I think the boat has been missed their, but I obviously stand to be corrected.

econo_2

Hmmmm,

I wouldn't worry yourself too much about it Drex. If I'm correct your money is in the bank earning something and it's for a house purchase where you are looking to buy in a market that has at present a downward spiral!

QE will not have an overnight Argentina horror play! A lot would argue even now that you are going to buy a house at a pretty good price! It's up to you to decide when you feel you are buying near a bottom. We could see bank rates paying 10% in a boom housing cycle and you'd still see yourself being totally outdone by that boom and saying the same thing.

If it is that you are really worried that a genuine Argentina is going to crop up down the road then there are sadly few safe havens for anyone. Gold one of the safest plays IF you really think that it will be Titanic all the way.

lostinrates

gecko wrote: »

I am in a similar position, no debts and have saved for the past 5 years to buy my first house. I am now wondering where to put all my savings to keep them safe (shares, gold) or just buy the house at the exorbitant prices here in the South East!

We're prety much the same. Been saving forever, and getting very miserly in order to build and preserve a substantial deposit and now......what? Just over half our savings are in Euros which I'm hoping might have been a good option.

ad9898_3

lostinrates wrote: »

Just over half our savings are in Euros which I'm hoping might have been a good option.

I don't know about that LIR, I think the Eurozone is in for a terrible time, I'm not sure the euro as a currency can withstand a recession.

lostinrates

ad9898 wrote: »

I don't know about that LIR, I think the Eurozone is in for a terrible time, I'm not sure the euro as a currency can withstand a recession.

Oh, I know I know- and prepare to scream- our euro account remains in ITALY! but my hope is that now we look set for devaluation that the exchange rate will or a short time make my euro go even further. It will be do or die time for us, cementing a commitment to the UK I guess.