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