Willy Huttonbollocks

The last time the British government could sell government bonds at interest rates as low as today\’s was in the early 1700s.

Gargling fucking nonsense.

The leading economic commentator on one of the leading national newspapers is ignorant of the difference between nominal (ie, unimportant) and real (important) interest rates?

Current real interest rates on gilts are negative: as they have been many a time before.

This is also quite excellent:

Overstretched banks have become more cautious about lending new cash; and even strong banks are caught up in the backwash because if they step into the breach they could fall into a vortex of falling property prices and declining economic activity, becoming weak in turn. So as banks stand aside from their crucial function of generating credit, governments and central banks must step in to generate the demand that has now disappeared.

OK, let\’s increase credit creation by the banks somehow.

There is also a case for a financial transactions tax – both to raise crucial revenue and to cap the growth and frenetic speed of financial transactions.

We\’ll do that by taxing transactions and thus reducing the creation of credit.


1 thought on “Willy Huttonbollocks”

  1. Will Hutton was working as an equity salesman for one of the leading gilt-edge brokers when we had the largest negative interest rates on gilts. No he is not ignorant, he is being deliberately misleading. Nor is he ignorant about the ability of banks to fail in free markets – but in free markets the failure of a single bank did not lead to a collapse. Scores of banks have failed in the USA during the last hundred years.
    Keynes prescribed a budget surplus during the upswing of the economic cycle and a moderate budget deficit during the trough. New Labour ran a structural deficit during the upswing and created a bubble instead of a boom; Osborne is running a bigger budget deficit than Keynes would have tolerated. Austerity? What austerity?

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