Today’s latest move from the Bank of England is straight from the Dale Winton school of economics: the team (ie, the Monetary Policy Committee) has been given £75 billion to spend in just three months. How will they manage? Time starts… now!
Although plenty predicted today’s announcement that Quantitative Easing will now be started few predicted the scale – £150 billion “maximum”. The MPC’s decision to spend half of it in 90 days makes the whole exercise into some kind of fiscal Supermarket Sweep.
“It is likely that the majority of the overall purchases by value over the next three months will be of gilts” says the Bank of England – handy, that, seeing as Brown has so much debt to issue. They are now out of ammo on the monetary side, having halved base rates to 0.5% where they are likely to stay until at least 2011.
So will this persuade the banks to start lending? Of course not – we seem caught in this Groundhog Day of multi billion pound spending programmes bailing out this, guarantee that.
Britain’s best politics newsletters
You get two free articles each week when you sign up to The Spectator’s emails.
Already a subscriber? Log in
Comments
Join the debate for just $5 for 3 months
Be part of the conversation with other Spectator readers by getting your first three months for $5.
UNLOCK ACCESS Just $5 for 3 monthsAlready a subscriber? Log in