I glanced at the BBC news website this morning and it was full of positive stories on the economy; the IPPR report, house prices on the up etc. etc. This afternoon it seems that the green shoots narrative might be flawed as it emerged that The Bank of England's (for which we can read Gordon Brown) have decided to pump another £50bn of new money into the economy in an expansion of their quantitative easing programme. This takes the amount spent on this programme to £175bn, 16.67% over the Chancellor's initial budget of £150bn. The BBC do report that the Bank of England said that the UK recession "appears to have been deeper than previously thought".
Oddly in the whole
BBC article there is not a word about the dangers of hyper-inflation resulting from QE or of the similarities with Zimbabwe or Weimar Germany.
Meanwhile,
Alex Masterley has spotted something else in the figures:
"Before the banking crisis, banks left an average of under £20 billion on deposit with the Bank of England. Now, after £125 bilion of quantitative easing, the figure has jumped to £161 billion. In other words, the banks, not wishing to take a risk on lending the extra cash, are simply leaving it on deposit with the BoE."
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