BofE's Quantitative Easing
Discussion
Did a search, and strangely couldn't find anything on today's announcement....
I'm struggling to understand the belief that by printing money, and putting it into the banking system, that suddenly the economy will recover.
Surely, if there was enough money in the system last year, there is still enough money in the system, even though it may be being withheld for whatever reason. Providing more money (which incidentally would surely be less valuable per unit), would merely mean that those stockpiling cash will have more units to stockpile, with the net effect of feck all?
Mervyn King's statement along the lines of 'I don't know how long it will take to take effect, or how much will be required to have an effect, but this method WILL work' on C4 news tonight shows that there seems to be little behind the measures other than blind faith?
Please educate me in the implications and mechanisms O Great PH Massive!
EDIT Ignore me, two threads have appeared!!
I'm struggling to understand the belief that by printing money, and putting it into the banking system, that suddenly the economy will recover.
Surely, if there was enough money in the system last year, there is still enough money in the system, even though it may be being withheld for whatever reason. Providing more money (which incidentally would surely be less valuable per unit), would merely mean that those stockpiling cash will have more units to stockpile, with the net effect of feck all?
Mervyn King's statement along the lines of 'I don't know how long it will take to take effect, or how much will be required to have an effect, but this method WILL work' on C4 news tonight shows that there seems to be little behind the measures other than blind faith?
Please educate me in the implications and mechanisms O Great PH Massive!
EDIT Ignore me, two threads have appeared!!
Edited by Sway on Thursday 5th March 22:16
Well it clearly can't work as it's being done under a Labour govt. Course, if it had been a tory measure it would be the pooch's pouch.
I'm no economist so I'm clueless on the theoretical rights/wrongs of the concept but glad someone's doing something more than just cutting base rates which is plainly not achieving much.
I'm no economist so I'm clueless on the theoretical rights/wrongs of the concept but glad someone's doing something more than just cutting base rates which is plainly not achieving much.
bitwrx said:
Fair do's, missed it. Please amalagamateGassing Station | The Pie & Piston Archive | Top of Page | What's New | My Stuff