Friday, October 07, 2011

A futile gesture

John Kemp, a Reuters market analyst is distinctly underwhelmed by Mervyn King and his colleagues on the Monetary Policy Committee. They have, writes Kemp, decided it's time for one last glorious but futile gesture to raise the whole tone of the war.

This is the £75bn-worth of quantitative easing (aka printing money) which "reflects the increasing confusion engulfing Britain's economic strategy". It also shows, adds Kemp, "mounting panic that the deal hatched between the Bank and the government last summer (fiscal consolidation in return for low interest rates, or Plan A) has plunged the economy into a prolonged slump".

With Boy Osborne at the helm, this was only to be expected. There surely cannot be anyone still in the grip of sanity who had any belief that Osborne would do the right thing or even begin to understand that was going on – he of "sharing the proceeds of growth" fame, right up to the moment the last financial crisis hit.

And that, with King telling us that the world is facing the worst financial crisis in history, is what is really scary – them up there don't have the faintest idea what they are doing. Now is the time to be very scared indeed.