Things are developing into a good old fashioned fist fight!
But it’s not in Portugal, Ireland, Greece, or Spain! …
No, it’s actually over here!…
Click on this link to go to an article that’s just appeared, today, on Bloomberg – in broad terms it says QE3 is needed to avoid conditions in the economy getting really very bad very quickly indeed. This is on the very same day that the Bank of England have announced its decision to hold interest rates, but added that it won’t be extending its quantitive easing. Click here
To add to the growing feeling that things really aren’t under much control David Blanchflower, a former member of the Bank of England’s MPC – click here for his resume – again today, said in an interview that the Bank of England’s monetary policy simply isn’t working. Click here for that Bloomberg article.
If you recall, back in my newsletter of July last year – click here- I listed what typically happens when businesses get into difficulties, suggesting similar things would be happening later on on a much wider scale when the ecnonomy got worse. One down, several more to go…
But it’s far, far more interesting than that…
Reading through its announcement over interest rates, the Bank of England appear to be fearful over inflation…
Well, Blanchflower, who I’ve met several times and seems to have his head screwed on, was replaced as a member of the MPC in May 2009 after being in office for 3 years, to be replaced by a guy called Adam Posen. Blanchflower was even given a CBE. He’s no mug.
But is it just a question of sour grapes?
I don’t think so – what I find interesting is that Posen is in fact an American citizen. Click here for his resume. So we have an American playing a major part in major decisions affecting our lives.
I wonder why that is?
Should we be worried that someone who’s not from the UK is making such major decisions for us? That we don’t have someone with similar skills amongst the 60 million odd of us?
Well no, because even that’s only half of the story…
Posen, and don’t get me wrong as I’ve listened to him talk too and he does talk sense, happens to be an expert in managing inflation.
He’s even co-authored a book entitled ‘Inflation targetting: lessons from the international experience’ with Ben Bernanke – yes, that Ben Bernanke, the Chairman of the US Federal Reserve.
Now tell me they don’t have in mind inflating our way out of our debt problem!
And if that’s our plan, I wonder what the Americans’ plan is given that their debt dwarfs ours?
Sleep soundly tonight, I’m sure it will all be alright, some day!