Monthly Archives: July 2013

A sceptic’s view of QE, an initially irrational policy, the controversies over which were whitewashed

I am, and always have been, dubious about the usefulness of QE, and regret the process by which the Bank and the MPC decided to embark on it, and gave overly confident accounts of how it worked and its impact.  … Continue reading

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Matthew Hancock’s ‘duty’

Recently Conservative minister Matthew Hancock declared that UK companies had a ‘duty’ to give preferential treatment to British workers applying for jobs in competition with foreign applicants.  Here are a few reasons why it was an astonishingly ill judged thing … Continue reading

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Economist ‘free exchange’ blog post on forward guidance

Here’s a link;  it goes over ground in a previous post, but more lucidly, after the expert input of The Economist‘s Britain editor Richard Davies.

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The row over bank capital and Nationwide

Recently Nationwide has complained to the Treasury that its ability to lend is being threatened by the Prudential Regulatory Authority’s insistence on it raising more equity capital.  Vince Cable took the unfathomable step of coining the phrase ‘capital Taliban’ to … Continue reading

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Response to Simon Wren Lewis: the output gap and inflation, necessity for a fiscal stimulus, and all that

Simon was very kind to dignify my blog post on why there should be no more fiscal stimulus with a response.   I don’t have much to add:  Simon inhabits (is in fact a far more senior participant in) the same … Continue reading

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Deft footwork by the hawks, and the subtleties of forward guidance when the causes of yield movements are unknown

Following the publication of the minutes of the MPC meeting on 3rd/4th July, I think a tweak is necessary to my reading of the press statement accompanying the decision. The minutes suggest the possibility that the tightening in the short … Continue reading

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Why there should be no more fiscal stimulus

In the last year, the protracted weak activity data in the Eurozone, and in the UK, has emboldened those who thought that ‘austerity’ policies were misguided, and that think that a renewed fiscal expansion will help solve the problem.  I think … Continue reading

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A look back at the March HMT Review of the MPC remit

This post takes a look back at the Treasury’s review of the Monetary Policy Committee’s Remit, published in March.  This might seem like old news.  But it is soon to be highly topical, as one of the outcomes of the … Continue reading

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Forward guidance on forward guidance?

There are two ways to read today’s statement by the Bank of England’s Monetary Policy Committee, accompanying its decision to do no more QE, and leave rates at their agreed floor. One is that it is advance warning (forward guidance) … Continue reading

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Why forward guidance could be a step backward

Mark Carney’s arrival as Governor, and his well publicised support for the policy of ‘forward guidance’, has had markets guessing whether he will be able to sway other Monetary Policy Committee (MPC) members to pursue this in the UK. ‘Forward … Continue reading

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