BOE Quantative Easing Propaganda

ei.sdraob

I taught members of this forum might find this interesting

its being sent to all UK businesses

http://www.bankofengland.co.uk/monetarypolicy/pdf/qe-pamphlet.pdf

Time Magazine

ei.sdraob wrote: »

I taught members of this forum might find this interesting

its being sent to all UK businesses

http://www.bankofengland.co.uk/monetarypolicy/pdf/qe-pamphlet.pdf

Why use the word propaganda, OP?

Flamed Diving

Coz the lizards iz out ta get us.

ei.sdraob

The Economist wrote: »

Why use the word propaganda, OP?

Propaganda is communication aimed at influencing the attitude of a community toward some cause

the leaflet is there to make businesses and people believe that QE is a "good thing" when its anything but, that fits with above definition

I completely disagree with QE as printing money is printing money and never ends well, no need for euphemisms


CE explains it better than I can
http://cynicuseconomicus.blogspot.com/2009/07/more-on-printing-money-in-uk.html
http://cynicuseconomicus.blogspot.com/2009/07/questions-for-deputy-governor-of-boe.html

Flamed Diving wrote: »

Coz the lizards iz out ta get us.

erm ok I never taught I would be branded a tinfoil wearing Zeitgeist watching nutcase, today is a first :rolleyes:

if it makes you feel better I don't believe in conspiracies, the governments and central banks are imho too incompetent as recently demonstrated to conspire

anyways i see you got a red flag so im gonna stop, conspiracies have nothing to do with QE

.

Flamed Diving

Errah, I was havin' a larf. We get a lot of conspiracy types through here. One must always be vigilant.

Time Magazine

ei.sdraob wrote: »

Propaganda is communication aimed at influencing the attitude of a community toward some cause

I'm aware of the definition, I asked to get a discussion going

the leaflet is there to make businesses and people believe that QE is a "good thing" when its anything but, that fits with above definition

I completely disagree with QE as printing money is printing money and never ends well, no need for euphemisms

Would you rather an inflation rate of 5% or 2%? Similarly, would you rather an inflation rate of -5% or 2%?

Central banks change interest rates to "unnaturally" affect the inflation rate all the time. Why do you have an objection to a control burst in the money supply to do the same thing?

You say "printing money is printing money", and that's true, but you need to include some sense of perspective here. The BoE don't operate from Zimbabwe; they're printing money to bring the inflation rate to 2%. To the best of my knowledge, printing money to move inflation to such a specific (and reasonable) target has never happened before. So can you explain why you're so sure it's not going to "end well"?

Flamed Diving wrote: »

Errah, I was havin' a larf. We get a lot of conspiracy types through here. One must always be vigilant.

But not presumptuous, thus the infraction. So let's keep it friendly and move on.

ei.sdraob

Actually I have objections with any manipulation of the economy, thats what pretty much got us here,

neither do I see anything wrong with deflation, what goes up cant keep going up right? Shouldn't inflation be caused by more economic activity not printing money?

150 billion pounds spend and they are still experiencing deflation with the rest of the world, when will they stop?

main concern should be export numbers, thats what creates real wealth, tho the pound devaluing did help them

i dunno i am torn on the whole inflation/deflation subject, but QE just smells wrong

Tricity Bendix

Shouldn't inflation be caused by more economic activity not printing money?

I'm sure it should, but the BoE can't alter the level of economic activity over night. They don't exactly have a lot of tools at the moment to keep inflation in and around 2%, so they're trying something out.

Actually I have objections with any manipulation of the economy

I think having a 2% inflation target is quite a reasonable intervention for a Central Bank to make, given the economic and social ills that occur due to delation and rapid inflation.

Having said that, I'll read your links and see if they can't change my mind.

eamonnm79

When the BOE was buying Assets from Private institutions what kind of things did they buy?
How much did they pay for them?
Did they pay the current market prices or did they pay over that value as Nama intends to do?
When they are selling them back as they intend to, have they made sure (contractually) that they will get at least what they paid?
Unless there are some pages in the document outlining the economic and social dangers of quantitive easing I think it is fair enough to call it propaganda.

ei.sdraob

eamonnm79 wrote: »

When the BOE was buying Assets from Private institutions what kind of things did they buy?
How much did they pay for them?
Did they pay the current market prices or did they pay over that value as Nama intends to do?
When they are selling them back as they intend to, have they made sure (contractually) that they will get at least what they paid?
Unless there are some pages in the document outlining the economic and social dangers of quantitive easing I think it is fair enough to call it propaganda.

from what I gather they are buying UK government debt mostly? ie printing money for welfare and public sectors

more on that here

http://cynicuseconomicus.blogspot.com/2009/06/quantitative-easing-monetizing-uk.html

eamonnm79

ei.sdraob wrote: »

from what I gather they are buying UK government debt mostly? ie printing money for welfare and public sectors

more on that here

http://cynicuseconomicus.blogspot.com/2009/06/quantitative-easing-monetizing-uk.html

Thats not what it says on the propaganda document (see page 7 in the purple writing)

ei.sdraob

eamonnm79 wrote: »

Thats not what it says on the propaganda document (see page 7 in the purple writing)

a clear lie

BOE are buying UK government bonds (ie printing money for the UK government)

see

http://www.telegraph.co.uk/finance/financetopics/recession/4642369/Weak-sterling-will-help-economy.html

Charlie Bean put his weight behind the pound's 25pc fall over the past year in an unusual comment on the pound. Mr Bean also confirmed that the Bank is poised to start buying government bonds in a drastic attempt to resuscitate the stricken economy.

http://www.bbc.co.uk/blogs/thereporters/robertpeston/

In April, May and June, Stheeman and his team flogged £57.9bn of gilts, while Mervyn King's traders waded into the market to buy £77.7bn of UK government debt.
The Bank of England is buying as part of its so-called Quantitative Easing programme to increase the stock of money in the economy and cut the cost of credit.

http://www.moneyweek.com/investments/government-bonds-bank-of-england-stops-printing-money-but-gilts-are-still-a-sell-14949.aspx

QE involves buying mainly UK government bonds (gilts) from investors. The idea is that the latter end up with more cash in hand. The Bank hopes this will encourage them to invest in riskier assets, helping to lower borrowing costs throughout the economy, and eventually ending up in the pockets of shoppers and home loan borrowers via more bank lending. It's basically what desperate central bankers do to make money even cheaper when interest rates have fallen as far as they can go.

eamonnm79

ei.sdraob wrote: »

a clear lie

BOE are buying UK government bonds (ie printing money for the UK government)

see

http://www.telegraph.co.uk/finance/financetopics/recession/4642369/Weak-sterling-will-help-economy.html



http://www.bbc.co.uk/blogs/thereporters/robertpeston/





http://www.moneyweek.com/investments/government-bonds-bank-of-england-stops-printing-money-but-gilts-are-still-a-sell-14949.aspx

It raises the question as to how much of the increase in the Ftse 100 and the Dow for that matter are directly attributable to this?

This is why you have Roubini and others talking about a double dip when the effects of quantitive easing/stimulous packages end.
Its also why obama is saying he may need a second stimulous (ie more printing money)

ei.sdraob

not only the stockmarkets

the GDP figures also get affected as GDP measures activity

and printing money is an activity and causes alot of extra activity in the economy

strip away quantitative easing and stimulus's and things might not look pretty


so you have Gordon Brown claiming that UK GDP is not falling as bad as the rest, but thats just a smokescreen

GDP rises after natural disasters as theres rebuilding activity, does that mean we should go out and destroy everything?

GDP, unemployment and inflation measures have been fiddled with so much one has to take them with a grain of salt

like FF here Labour in UK dont want to admit to screwing up badly and will use all sorts of statistics and figures to make themselves look good and try to stay in power

economy be damned

Time Magazine

ei.sdraob wrote: »

like FF here Labour in UK dont want to admit to screwing up badly and will use all sorts of statistics and figures to make themselves look good and try to stay in power

Economics forum. Let's try and keep it that way and not get muddled in those political debates.

ei.sdraob

The Economist wrote: »

Economics forum. Let's try and keep it that way and not get muddled in those political debates.

you are right

to often nowadays both fields get involved