Friday, April 10, 2009

Bank of England speeds up quantitative easing

Jesus H. Christ.

It's obviously been working so well that they've decided to have even more of it.

You will of course witness 'good news' stories like this one, which are being fed by all of this extra counterfeit cash. No doubt Gordon will be on the blower every day, hungry for such 'good news', and will be urging his sinecured hamsters at the Bank of England to keep spinning those treadmill wheels to pump out even more of this paper confetti rubbish to steal even more wealth from the British people, in order to win the next election.

You never know. It may even work.

Expect inflationary Armageddon when the hangover from this money drug finally does hit.

Get out of Pound Sterling denominated assets now, while you can. Hard assets with intrinsic value in and of themselves are the only place to be. Gold, gold mining stocks, Chinese stocks in good Chinese companies which service the Chinese economy, and stocks in good commodity companies in commodity-rich countries such as Australia and Canada. Plus, anything else you or Peter Schiff can think of.

But do, for the love of God, get all of your spare wealth out of the Pound Sterling, shortly to be renamed 'The Zimbabwe'. If you don't, Gordon Brown will have no mercy in taking this wealth from you, via his inflation machine, and destroying it, in order to win the next election.

Or do you think he's supposed to serve you, rather than himself and his chums in the client state?


Anonymous said...

I read a piece by the chief economist at the Bank of England the other day (looks like he is fresh out of uni)and he said we were in safe hands because as soon as there were signs of inflation they would put interest rates up and sell the corporate and government bonds they had purchased under the QE regime.

It really beggars belief, doesn't it?

So all the companies saved and all the homeowners saved by QE promptly go bust because of higher interest rates.

Or is this how it's meant to work?

Jack Maturin said...

They'll never be able to raise interest rates to 10%-15% or even 20%, as they'll need to do if they're to get this one back inthe bag.

They're "'Aving a Laugh" if they think they can.

The political will, simply does not exist outside of 'Daniel Hannan Towers'.

Plus, is the British government really going to pay 15% interest on its bonds? Pull the other one. The tax alone required to pay off the interest on government debt will cripple the country, never mind paying off private debt interest.

The entire country, including the government, will be bankrupt in about one month flat. Make it one week.

Now the genie is out of the bottle, there is only one way out of this for the government. It's called a printing press.

Anonymous said...

They will not have an option however, what do you think the market value of a 40 year gilt issued now with a yield of say 3.5 percent fixed will be when interest rates are 15 percent. Not very much I would imagine.

And who are the holders of all these gilts? Our pension funds.

But I guess its all for the greater good.... or something

not an economist said...

Whatever the BoE rep says they will be slow to put up interest rates.

As the economy starts to pick up under all of this inflationary pressure, calls for raising inteerst rates will be resisted on the grounds that the initiall stages of any economic recovery are always fragile: to raise rates too early would risk another downturn.

When the exact, best movement to take counter cyclical action comes is not a science. It will all be judgement. And the correct moment will be missed and the infation holcaust will start.