No need to panic after all.

[rootsnall]

Not necessarily true - the theory is that deflation would have been far worse had they not applied QE. Most people agree, but it is like most of these things, only a theory.

It may have delayed deflation by delaying getting all the tulip out of the system. They are still plagued by it now and I still think they have hidden bad debts all over the place. I'm sure they ( and us now ) would have been better off long term getting things over with as quickly ( and painfully ) as possible. However in our case that would mean Gordon and the current bunch who created this mess taking the blame for it.

[PM-Junkie]

It may have delayed deflation by delaying getting all the tulip out of the system. They are still plagued by it now and I still think they have hidden bad debts all over the place. I'm sure they ( and us now ) would have been better off long term getting things over with as quickly ( and painfully ) as possible. However in our case that would mean Gordon and the current bunch who created this mess taking the blame for it.

I agree. I did say in my answer to DP that I didn't think QE is a good idea. I could put it stronger than that, but there may be ladies listening

[Solidec]

It truly is dangerous:

- Low interest rates
- Moderately high inflation (real inflation not what Merve the Swerve peddles in his MPC reports)
- Quantitative Easing
- MASSIVE public and private debt levels


>> Only one real outcome, hyperinflation, huge currency devaluation.

Really not sure how anyone can see it any other way.

[Gonzo]

It truly is dangerous:

- Low interest rates
- Moderately high inflation (real inflation not what Merve the Swerve peddles in his MPC reports)
- Quantitative Easing
- MASSIVE public and private debt levels


>> Only one real outcome, hyperinflation, huge currency devaluation.

Really not sure how anyone can see it any other way.

I can't. I really can't see any other outcome.

[ace00]

>> Only one real outcome, hyperinflation, huge currency devaluation.

Really not sure how anyone can see it any other way.

Well 2 things:
1. Currency already devalued (25% against the Euro - that's more than "Black Wednesday").
2. If everyone's printing money and global demand destruction is rampant, what do prices inflate against?

[BlasterBates]

...well the US and UK are closer to quantative easing, but the $ is a reserve currency so the US is more likely to get away with it for a while. In the beginning the £ would deprieciate against most other currencies until other central banks follow suit, if they were to do this. If everyone does it then commodities will rocket.

[Solidec]

Well 2 things:
1. Currency already devalued (25% against the Euro - that's more than "Black Wednesday").
2. If everyone's printing money and global demand destruction is rampant, what do prices inflate against?

Who do you mean by everyone? As far as I see it, only people likely to print shedloads of cash are the US (reserve currency status, commodities like oil priced in $) and the UK.

If common consensus is true and the US are already printing money (they already have legislation that allows them to withold the fact that they are) then their currency has NOT taken a beating like sterling.

The EU wont do it, as too many countries in surplus or well within normal operating status would be negatively impacted, Japan and China both devalue their currency to keep their exports flowing. Iceland is too small to matter, and we all know about Zimbabwe.

I am positive Britain will be in isolation with regards to huge currency devaluation if they kick the printing presses into overdrive, no other country that counts in the global economy has so many negative indicators as us.

[d000hg]

I can't. I really can't see any other outcome.

I guess the people running the massive simulations on super-computers are being told otherwise... of course the worrying thing is people on these boards might have been involved writing the simulation software....

[Gonzo]

2. If everyone's printing money and global demand destruction is rampant, what do prices inflate against?

Not every country has had quite the same appetite for debt over the past five years that the UK has.

[BlasterBates]

Quantative easing will inevitably lead to a devaluation. Think of it as the UK Government taking money out of peoples accounts and spending it for them. If QE is done in a limited fashion it will lead to a devaluation step, so causing inflation at some point in the future, but not out of control.