Further Quantitative Easing (QE3)

MiserlyMartin

Ark_Welder wrote: »

Google Rapid fall in inflation expected from the FT for a view on prospects.

I hope they are right, but I've heard it all before and seriously doubt it.

Ark_Welder

MiserlyMartin wrote: »

You are still ignoring RPI versus the base rate - that has never been worse than today.. I don't agree with you that QE has stopped deflation dead, due to all the other inflationary aspects I doubt it was needed. Besides, in this situation of prolonged 0.5% base rates, 2% deflation would be welcome, to offset the real terms loss to savers, which you seem to continue to ignore.

Given that I am a saver, I would be unwise to ignore myself, never mind ignoring the effects of inflation on my investments. High interest rates due to high inflation results in low real returns - a fact that is often ignored, or unrecognised.

For an example of low base rates and prolonged deflation, look at the lack of growth in Japan for the past 20 years. Perhaps if they had indulged in QE then they would have recovered well before now. Ignoring the policy failures of the 1930s would be unwise.

meatandtwoveg

Ark_Welder wrote: »

For an example of low base rates and prolonged deflation, look at the lack of growth in Japan for the past 20 years. Perhaps if they had indulged in QE then they would have recovered well before now. Ignoring the policy failures of the 1930s would be unwise.

Japan have been printing money and buying up bonds since the year dot......They invented ZIRP, QE, they have been flooding the world with cheap moeny for decades.........Look where they are, no growth, low wages, thats what we have to look forward to, oh and they have a manufacturing base, we have the City....:beer:

Ark_Welder

meatandtwoveg wrote: »

Japan have been printing money and buying up bonds since the year dot......They invented ZIRP, QE, they have been flooding the world with cheap moeny for decades.........Look where they are, no growth, low wages, thats what we have to look forward to, oh and they have a manufacturing base, we have the City....:beer:

http://en.wikipedia.org/wiki/Deflation#In_Japan

meatandtwoveg

http://www.bbc.co.uk/news/business-16385381

QE is not helping this......

Ark_Welder

meatandtwoveg wrote: »

http://www.bbc.co.uk/news/business-16385381

QE is not helping this......

It wasn't supposed to...

Defined benefit schemes were already being reduced before QE.

meatandtwoveg

Ark_Welder wrote: »

http://en.wikipedia.org/wiki/Deflation#In_Japan

So why did you say "Perhaps if they had indulged in QE then they would have recovered well before now".

They did indulge in QE, they have not recovered, so try something again and expect different result, genius......

Ark_Welder

meatandtwoveg wrote: »

So why did you say "Perhaps if they had indulged in QE then they would have recovered well before now".

They did indulge in QE, they have not recovered, so try something again and expect different result, genius......

But not until 2001, 12 years after their problems started, and not on a sustained basis.

http://en.wikipedia.org/wiki/Quantitative_easing#In_Japan

talexuser

Ark Welder makes some good points well, I just can't help feeling that the max inflation the voters will let them get away with is the Government's secret policy out of the debt mountain, and the 2% target now just cynical deceit for public consumption.

In any event let us remember George Osborne's original speech when QE was first introduced - it was an "admission of failure" and the "desperate act of desperate governments". The back pedalling was at warp speed as soon as he was in charge... :rotfl:

meatandtwoveg

talexuser wrote: »

Ark Welder makes some good points well, I just can't help feeling that the max inflation the voters will let them get away with is the Government's secret policy out of the debt mountain, and the 2% target now just cynical deceit for public consumption.

In any event let us remember George Osborne's original speech when QE was first introduced - it was an "admission of failure" and the "desperate act of desperate governments". The back pedalling was at warp speed as soon as he was in charge... :rotfl:

Inflation to get out the debt mountain is wage inflation...This ain't coming to a town near you...Rising costs are down to one thing, a trashed currency, due to ZIRP, QE and an economy reliant on printing money out of this air to support deficit spending...

Money backed by an asset, money backed by debt is money, printing money cannot and will not create wealth, see Zimbabwee.....

Once the economy becomes reliant on magic money, well its hooked for good........Spend what you have, enjoy it, because it is being stolen by inflation theft......simples...