You are viewing b_chu

Ben Chu

Ben Chu has been a leader writer at The Independent since 2004. Before that he worked at the paper on the comment desk, letters department and the personal finance pages. He studied history at Jesus College, Oxford between 1997 and 2000.

Previous Entry | Next Entry


The Tories get it right on quantitative easing

Posted by Ben Chu
  • Friday, 6 March 2009 at 01:59 pm

I've been unimpressed with much Conservative policy during the economic crisis (see here and here), but I think their decision to give (grudging) backing to the Bank of England's decision to commence quantitative easing merits respect.
            Politically, it would be very easy for the shadow chancellor George Osborne to adopt the line that Iain Martin of The Telegraph urges on them here. Opposing QE would resonate with a public conditioned by decades of economic history to regard inflation as a far bigger threat than deflation. And, as Martin, points out, if the monetary easing does work, the electorate would be unlikely to punish the Tories at the polls for having got it wrong.
        
But such a stance would also fly in the face of a solid consensus of professional - and independent - economists that such extraordinary action is necessary to curb a very real threat of destructive deflation. The Tories have put the national good above short-term political advantage. Good for them.
 

Comments

The Tories get it right on quantitative easing
oldrightie wrote:
Friday, 6 March 2009 at 02:38 pm (UTC)
The Tories have put the national good above short-term political advantage.

----------------------------
They usually do, possibly why they lost power.
It won't work
zansal wrote:
Friday, 6 March 2009 at 04:00 pm (UTC)
simply because no-one understands it. Nothing the BoE has done in the last 6 months has had any positive effect on the economy, no "green-shoots" nothing.

QE will be the same. It's just another technique to help the banks improve their balance sheets.

It does nothing to create consumer or investor confidence.
Advertisement

Syndicate

RSS Atom

Report Comment

To report an offensive comment for review, please send a Personal Message and provide a link to the comment. The moderators will review it and take action if necessary.
Powered by LiveJournal.com
Designed by chasethestars