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BOE to hold firm on low interest rates

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Comments

  • CLAPTON
    CLAPTON Posts: 41,865 Forumite
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    lvader wrote: »
    But it hasn't though has it, money supply has declined.


    indeed so

    the test will be, when the economy starts to motor and home grown inflation pressures start to mount.
  • Thrugelmir
    Thrugelmir Posts: 89,546 Forumite
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    CLAPTON wrote: »
    indeed so

    the test will be, when the economy starts to motor and home grown inflation pressures start to mount.

    Banks are contracting still though. Barclays is shrinking it's balance sheet by £85 billion as part of its recapitalisation exercise as an example.
  • CLAPTON
    CLAPTON Posts: 41,865 Forumite
    10,000 Posts Combo Breaker
    lvader wrote: »
    But it hasn't though has it, money supply has declined.



    which measure of money are you considering?
  • Graham_Devon
    Graham_Devon Posts: 58,560 Forumite
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    lvader wrote: »
    But it hasn't though has it, money supply has declined.

    QE has been done on a large scale, with countries acting together.

    It's when we do QE when every else is recovering that will be very problematic.
  • Thrugelmir
    Thrugelmir Posts: 89,546 Forumite
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    CLAPTON wrote: »
    which measure of money are you considering?

    UK Money Supply M4
  • lvader
    lvader Posts: 2,579 Forumite
    Part of the Furniture 1,000 Posts Combo Breaker
    Graham_Devon wrote: »
    QE has been done on a large scale, with countries acting together.

    It's when we do QE when every else is recovering that will be very problematic.

    We seem to be recovering as well as anyone, i find it doubtful we will suddenly become unique in our monetary policy. The US is still increasing QE every month with no sign of that going away any time soon.
  • Thrugelmir
    Thrugelmir Posts: 89,546 Forumite
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    lvader wrote: »
    We seem to be recovering as well as anyone, i find it doubtful we will suddenly become unique in our monetary policy. The US is still increasing QE every month with no sign of that going away any time soon.

    Last figures I saw a while back showed a net reduction of UK banking lending of over 18% since it's peak in 2009. Government stimulus and temporary schemes does appear to be papering over the cracks.
  • lvader
    lvader Posts: 2,579 Forumite
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    Thrugelmir wrote: »
    Last figures I saw a while back showed a net reduction of UK banking lending of over 18% since it's peak in 2009. Government stimulus and temporary schemes does appear to be papering over the cracks.

    Sure it is but the cracks are pretty much all over the world now, even emerging market countries are in deep trouble.
  • sabretoothtigger
    sabretoothtigger Posts: 10,036 Forumite
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    edited 26 August 2013 at 11:45PM
    Sounds like a rabbit in a hat. They most definitely produced more money yet we can argue money supply is less.
    I wonder where it has gone and when it will come back. Could banks contract enough to completely counter QE and if that occurred is it perfectly ok then
    Nationwide is also reducing some lending for basel 3 I think

    The US is still increasing QE every month with no sign of that going away any time soon.

    The thing is if FED was not actively buying more debt for its QE then the USA deficit would be highlighted far more possibly.
    Im not sure if I can find a graph but it appears their spending is out of control still and a problem, despite a very accommodating world market for dollars.
  • chucky
    chucky Posts: 15,170 Forumite
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    Graham_Devon wrote: »
    It's when we do QE when every else is recovering that will be very problematic.
    It seems that your doom and gloom may be misplaced yet again [again].
    The poll by the Confederation of British Industry (CBI), which also found rising optimism in the key sector of the economy, adds to a string of recent signs that recovery is gathering pace.
    http://mobile.reuters.com/article/idUKBRE97P0XU20130827?irpc=932
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