Thursday, 5 March 2009

£25bn a month for the next three months

The Bank is printing an extra £25bn a month for the next three months. That's £830m a day. There are 45m voters, which means that each one of us is handing over £18.40 a day. Every day for the next three months. Including weekends. To the banks. To help them lend it back to us.

Well excuse me, but wouldn't it be easier to just give us an extra £18.40 a day each, and the banks wouldn't have to lend?

Just asking.


Chris said...

To paraphrase both Morbo Newsmonster and the Mises Institute chaps: "Fiat money does not work that way!!!" It's only there so long as you *don't* ask to see it for yourself. You must trust the men with the good suits and the groverobber's eyes. ;)

Of course, we the little people, get the use of this new money last, only after the inflationary effects have taken effect throughout the market. It's just another pyramid/Ponzi scheme (nothing we don't all know, but always worth reminding oneself).

Can we have that election NOW please?

polaris said...

Of course that is exactly what the Japanese government is doing - giving their population stuffed envelopes. At least they have some say in how it is spent...

Dungeekin said...

'City of London Hit by Massive Power Cut'

The City of London was this morning been hit by a massive power cut, blacking out most of the Square Mile's financial institutions and leaving bankers and traders unable to work.

The power cut is believed to have been caused by every single one of the Bank of England's printing presses going into overdrive simultaneously.

Under the BoE's new Quantitive Easing policy, all the new banknotes created will have an extra zero added - the £5 becoming £50, the £10 becoming £100 and so on. A spokesman for the Monetary Policy Committee said that they were introducing the new policy 'based on the successes of Quantitive Easing in Zimbabwe'.

The power cut in the City has so far caused no major problems, given that the banks and the Stock Exchange are all too screwed and skint actually to do anything. The only personnel affected are those currently counting Sir Fred Goodwin's monthly pension payout.


Blue Eyes said...

It's when you pose questions like that you realise how disastrous this policy is. I said right at the beginning why does the Bank not send a cheque for £10,000 to every voter. But of course that would be a nonsense just like this is.

Inflation here we come.

TheFatBigot said...

The bit I can't get my flabby head round is how they can think consumer spending can be boosted when the last thing on any sensible person's mind is to borrow and spend a penny more than absolutely necessary.

Savonarola said...

FatBoy is spot on.

The leveraged consumer had a savings rate of -0.9% in Sept 2008(Asians typically save 12%). People now realise that saving is the name of the game. When savings rate approaches 6% we may see some return of spending but the days of using credit cards and homes to fund current expenditure are gone for a decade.

Until average earnings rise there will be no real growth. Average earnings have barely risen since 2000. If you take out leveraged consumption our GDP growth rate for last decade is closer to 1% that the 2.75% claimed.

Mervyn is shameless. He knows he is doing wrong. But sadly all take their cue from Brown the Clown who is trying to save his political life by playing the role of Action Man. FFS he is spending his days and nights drafting employment contracts for bankers. Nero. Rome.

Anonymous said...

Why don't they give it to us?

No, no, you don't undestand. It's the people who get the new fiat money FIRST who profit from it. And that has to be the politicians' friends.

So of course it goes to the banks.

And everybody else get screwed.

Buy gold. Actually you should have bought it last year.

Anonymous said...

The Fat One is right. And it's not just consumers who don't want to borrow. Businesses don't want to invest and investors want to see asset prices bottom out before taking the plunge. The only people who rationally want to borrow right now are those who won't be able to pay it back. How on earth is quantitative easing going to increase anything other than prices?