“Central banks have tough time finding the exit…” Headline on Bloomberg. I am sorry but the central banks would have a ‘tough time’ finding their own backside even if you drew them a map and left a trail of breadcrumbs.
This is a great article. A veritable festival of the stating the blindingly obvious. “The recovery… is proving weaker than projected.” Said the OECD. Bet you hadn’t realized that. Thank god we have economic experts to help us.
In fairness the article does contain a quote by Stuart Thomson of Ignis Asset Management in Glasgow who at least was honest that,
“It’s a done deal that more quantitative easing is coming and then the only question now is when we get it.”
And don’t be fooled in to thinking that because it will be printed and not borrowed that this is a) OK and b) not going to cost you. Because it is not OK and will cost you. It will be seen as material to the over all debt burden of GB and will be used to talk of how out of control our debts are and how much more austerity we must have.
Remember, on every one of those ten pound notes it says, “I promise to pay the bearer…” That’s YOU promising.
The article makes clear what I argued in one of the very first posts on this blog back on the 31st of January in Stimulus Withdrawal. That there isn’t going to be any exit from the stimulus measures. Not back then, not now, not for a long while or until they wreck entire nations. If I knew, so did they.
The most important line in the Bloomberg article is this,
Top Bank of Japan officials today flagged rising risks to the nation’s growth as the yen climbed in the aftermath of the Fed’s statement.
The Fed statement they are referring to is yesterdays when the Fed said it stood ready to take whatever steps were necessary. Including more asset and bond buying and QE.
Japan sells billion upon billion of yen in a desperate attempt to weaken their currency. Just a few days later the Fed hints it might print dollars which would weaken the dollar and the iron balance swings back up lifting the Yen back to where the Japanese were so desperate to move it from.
Hi Golem, they were saying similar things on CNBC last night. We would should be grateful for all this central bank intervention, the wisdom of politicians in providing the TARP. The conspicuous hale and hearty nature of the big banks today shows that the cynics were wrong and people without PhDs in economics should not talk the market down.
Cue Eddie Murphy – "Get the fuck out o' here!"
I see stirrings of a charm offensive by the banks everywhere I look; even on some of the Guardian blogs, where there is an increasing number of City defenders.
We're in the phoney war right now. Let's see how 'charm' goes down once the cuts start to hurt people. The, I suspect, charm will make way for scape goating and hate campaigns against the weak.