Murph and Andrew Neil


60 thoughts on “Murph and Andrew Neil”

  1. Somebody please upload a Utube version for us forriners. Too gud to miss!
    Would it be worth overdubbing some soundtrack from Downfall?

  2. SBML

    No, your first “Linky” is better – that’s the full interview, topic starts at 9.30, and RM starts at around 12.15. “Order order” is just selected quotes.

    It’s too good not to hear all of it..!!

  3. Problem is, Ritchie does speak half-truths. CPI is around 0%, the target is 2%, therefore Something Must Be Done. Along comes Ritchie with PQE which is indeed Something, and will most definitely generate inflation.

    The underlying error is the inflation target itself. Smarter economists than Ritchie have proposed a nominal GDP (nGDP) target, targeting inflation + GDP. If it’s 2008 and GDP is falling, even in the face of rising inflation, then printy-printy; if it’s 2015 and GDP is rising briskly even in the face of zero inflation, then it’s safe to raise rates.

    Politicians would like a house price inflation target of around 5% per year; but they can’t explicitly say so. nGDP targeting achieves roughly the same thing.

  4. It is very difficult to make any sense of his proposals as they seem to change from sentence to sentence. Does he want PQE now? I think I heard 3 different statements on that particular subject. He invented yet another number about companies in the UK that don’t pay tax. I thought he came across as a babbling fool, but that might just be confirmation bias. Baroness Prosser didn’t seem very impressed, however.

  5. The terrifying thing about his appearance, and it will be the first of many, is that he is phenomenally convincing – if you don’t have the slightest clue about economics. And bear in mind that hardly any of the electorate have the slightest clue about economics.

    Added to that he has a complete and utter belief in his own genius.

    This is a VERY scary political combination.

    He’s like someone who writes a bestselling diet book that sells millions called: HAVE YOUR CAKE AND EAT IT, that explains how you can lose stones eating cake, chips, chocolate and alcohol. He could stand before a panel of scientists and dieticians who pull apart every single one of his statements, but he’ll still continue blindly on, followed by his advocates.

    Because they WANT to believe it to be true.

    Later, when they all weigh 22 stone and are dying of heart disease it’ll be too late to realise he was wrong.

  6. Diogenes: Baroness Prosser didn’t seem very impressed, however.

    But she had clearly just been dragged through a hedge backwards so was entitled to look confused.

    On balance, this outing was rather a disappointment to his fans on this side of the divide I should have thought.

    Andrew Neil must try harder.

  7. “phenomenally convincing”

    That’s fascinating because that is not how it came across to me, at all. He got refuted so easily by Andrew, so often, coming across as a slightly petty / “squabbly” character?

    But you are quite right, we are not his target audience, so who knows?

    As time goes on, it will be very interesting to see how comfortable Richard is with being continually and repeatedly told that he’s just plain wrong?

  8. Did the LHTD say that the Governor of the Bank of England has a target of 2% inflation as if he has to maintain and deliver an inflation rate of 2%? As far as I understand it, the Governor’s job is to keep inflation below 2%.

  9. Came across to me as pompous and somewhat patronising. Had an answer for everything, but more in the way of a smart arsed teenager. Andrew Neil appeared to be getting annoyed with Murphy’s interruptions – might make him more combative next time he is allowed to interview the great man.

  10. PF.

    I try and see these people through the eyes of ignorance. Most people have no common sense re economics, and they already distrust politicians and bankers.

    Along comes X who tells they they are indeed right. It is all a giant conspiracy. All they need to do is shoot some people and print lots of money, then everyone can have an iPhone and a ferrari.

    When it’s pointed out said X is a lunatic who has to use his toes to count to 10, X can say, “Well, they would say that, wouldn’t they? They are part of the conspiracy.”

    Circular logic fulfilled it is on with the shooting people and money printing.

  11. Thanks diogenes, I hadn’t realised it was Lady Prosser. I thought he’d brought his mum along to give him his cuddly toy and a glass of milk if he got over-heated.


    The inflation target of 2% is expressed in terms of an annual rate of inflation based on the Consumer Prices Index (CPI). The remit is not to achieve the lowest possible inflation rate. Inflation below the target of 2% is judged to be just as bad as inflation above the target. The inflation target is therefore symmetrical.

    If the target is missed by more than 1 percentage point on either side – i.e. if the annual rate of CPI inflation is more than 3% or less than 1% – the Governor of the Bank must write an open letter to the Chancellor explaining the reasons why inflation has increased or fallen to such an extent and what the Bank proposes to do to ensure inflation comes back to the target.

    A target of 2% does not mean that inflation will be held at this rate constantly. That would be neither possible nor desirable. Interest rates would be changing all the time, and by large amounts, causing unnecessary uncertainty and volatility in the economy. Even then it would not be possible to keep inflation at 2% in each and every month. Instead, the MPC’s aim is to set interest rates so that inflation can be brought back to target within a reasonable time period without creating undue instability in the economy.

  13. I watched the interview with my wife, who thinks Murphy in print is deeply unconvincing. She thinks Murphy sounded very plausible and reasonable and that AN was too aggressive. I don’t agree about AN; but, if I put myself in the shoes of the average punter, I’d say Murphy sounded worryingly credible.

  14. ECB target is “below but close to” 2%, which in practice means they slam on the brakes as soon as the German political classes start moaning about prices rising in Hamburg shopping centres. BoE must maintain inflation within 1% either side of 2% or the Chancellor wants to know the reason why.

  15. I’m with Theophratus’s wife. In writing he (Murph, not Theo) is insufferably pompous. He came over much better in the interview, possibly because AN didn’t let him get away with too much. Seemed to me to be rowing back on the magic money part – said loads of people want to buy gilts anyway.

    Bit bollocks on the tax gap, but loads of people believe that stuff, so he doesn’t need to be good.

  16. Have you never considered that the man may well be a genius? Perhaps no-one in the history of mankind has considered his unique solutions?

    Yeah and fucking Rochdale are going win the FA cup this year.

    Definitely gissa job. Tim.

  17. A bit off topic, but Carney said (and I’ve heard it before) that it’s the poor who get hit by inflation.

    If you are poor, you have no money. So you can’t buy stuff now. Inflation? Still can’t buy stuff. No change. If you are poor and have benefits, they (usually) go up with inflation. What am I missing?

  18. Part of the business of evil IS to sound reasonable. However thick the pigshit that fills Murph’s cranium it would be a mistake to think he would be bouncing around like Tom Cruse at a DFS sale. First time out anyway.

    We know he is not a reasonable or friendly fellow so the question is can he take pressure? The first time out Lucifer would be on his best behaviour, Can the porker hold on when the stress mounts and fingers are wagging in his egotistical face?

  19. £120B of uncollected taxes, because of tax avoidance, i.e., following the law. It would seem then that the entire economy of the UK is uncollected taxes.

    All your money are belong to us.

  20. The post-match analysis on the Murphmongster’s blog is entertaining

    aje says:
    September 17 2015 at 5:40 pm
    I treat your questions like Andrew Neil’s on Venezuela

    I am genuinely interested by what appears to be a contradiction in your arguments. But I see that you’re not willing to discuss it properly, so I guess we’ll have to leave it there.

    Richard Murphy says:
    September 17 2015 at 7:54 pm
    Respectfully: I do not believe you

    So I am deleting your mails

    You are contravening the comments policy

  21. Andrew K

    That’s wonderful.

    Because what Ritchie is in effect openly admitting is that he would have deleted Andrew Neil given the chance..:)

  22. I’ve just today instructed the accountant to take advantage of every break in the system, simply to irritate murph.

  23. Luke – the benefits go up once a year based on certain date rate of inflation.
    If your benefit goes up by £2 a week and your weekly shopping bill goes up then by £1.50 and your utilities by £2. Plus rent payable by £1.
    Worse off.

    An employee can ask for pay rise, get a 2nd job etc. Hard on benefits.

  24. @Luke
    Inflation causes rises in asset and land values/houses ie things the poor don’t own. Furthermore inflation of assets (aka house prices) erodes the debt (mortgages) used to buy those houses, so inflation is a boon for the rent-seeking asset owning classes and a bind for the producer/worker classes.

    There is also a lag between increasing the money supply and a rise in prices. The ones that get to spend the newly issued money first get to spend the new money at the old prices. These people are the wealthy and the politically well connected ie shareholders and executives of the companies that are the beneficiaries of the state’s money-printing ie social house-builders/energy/infrastructure companies that are favoured by the “National Investment Bank”. Some of this money eventually trickles down to the working classes in higher wages, but by then inflation has taken off and they are no better off. Carney would perhaps have better expressed it by saying inflation increase inequality.

  25. The poor do of course have income. They tend to have spent all of it on essentials and addictions by the time the next pay or welfare cheque comes through.
    Something which requires the poor person to save for four months ( a new phone or washer ) is more in reach if inflation is nil. The same item might require five months of savings if inflation is 5% a month.
    I think the rich who already have savings are affected less by this effect.

  26. I’d agree with some previous commentors and say scarily convincing when compared to his blog rants (or should that be semi random key strokes) and a lot of politicians if one ignores substance of replies.

  27. To address Luke’s question re the relationship between the poor & inflation, he should try asking te poor. The poor do have money, Luke. Just ot a lot of it. Which tends to exclude them from a lot of tings in the inflation basket, dont tend to inflate. Theyre short on consumer electronics, hairdressing, bling..Long on bus fares electricity bills, boiler repairs, Silk Cut… And hey, wadyaknow! All those things take jumps of 10% whilst foreign holidays go down 10%. Its very expensive being poor

  28. He may have come across as semi-convincing, but only because he employed the simple expedient of lying. Saying “no, I never said that” or “no, that’s not what we meant” works for a very limited time only. I suspect if he gets much more exposure, he’s going to come up against somebody who will have done his research and simply read his own words back to him.

  29. The biggest contradiction here is Corbyn’s “bleed the rich” argument versus printing money, which is an effective tax on everyone, especially the poor.

  30. The biggest contradiction here is Corbyn’s “bleed the rich” argument versus printing money, which is an effective tax on everyone, especially the poor.

    Indeed. And this was the first time AFAIK it was said that Murph’s PQE was only going to be used when the economy is in recession. And Murph seems to think the economy is in recession if there is a budget deficit.

  31. As one of those excluded from Richard Murphy’s blog after challenging him, I watched his appearance with interest, and I have to admit that he is effective, but outrageous. I am in the Green Party, attempting to bring some realism and sustainability to its economic policy against people like Murphy, so the contrast with Natalie Bennett’s mauling by Andrew Neil was interesting to me.

    When Murphy is presented with arguments or facts that challenge his argument, he simply asserts the opposite, making his story up as necessary. When challenged about PQE violating BoE independence, he says that HMT “authorises” QE now, which is true, but “authorise” is not the same as “instructs”; a truly independent BoE could simply decline to use that authorisation. Then, when reminded that he has written that any BoE governor who refuses to do PQE as instructed should be dismissed, Murphy asserts that the BoE Act requires the BoE to support the government’s economic policy, which is not true; what the BoE Act actually says is that the objective of the BoE to support the government’s economic is “subject to” its first objective to “maintain price stability”. In theory, even if the UK economy was in recession, if inflation is above target and shows no sign of falling, the BoE should refuse to do PQE, if not tighten monetary policy. But Murphy argues with such flourish – “let’s be clear about how central bank independence works now”; “that is what the documents say, Andrew….let’s talk about the realities not the fiction” – that a relatively uninformed viewer could believe that he is on solid ground.

    But in my view, the weakest point of PQE, which Andrew Neil missed entirely, is the idea, implied by Murphy, that PQE can be turned on and off according to the state of the economy. In fact, the reserves supplied when PQE is done by the BoE buying National Investment Bank bonds remain outstanding until the NIB bonds are repaid, or the reserves are reabsorbed by the BoE in some other way. Moreover, reserves normally pay interest at Bank rate, meaning that PQE is effectively funded by floating rate borrowing. So PQE amounts to a gigantic bet that floating rate funding turns out to be cheaper than fixed rate debt, which seems a bit unwise when long-term interest rates are at historic lows. Murphy has argued that zero interest could be paid on reserves, but in that case, if the economy recovers and market interest rates rise, the banks could be expected to try to spend the reserves they held, typically on interest-bearing loan assets, probably with inflationary results. Alternatively, the NIB bonds could be sold back into the market to reabsorb the reserves, but that amounts to a bet that borrowing initially at floating rates and then at fixed rates will turn out cheaper. In short, PQE amounts to fiscal stimulus via a debt-funded investment scheme, which in my view is perfectly respectable, so there is no need for the smoke and mirrors of involving the BoE.

    I am afraid that it is going to take a more specialised interviewer than Andrew Neil, and one that is extremely persistent, to expose Murphy as selling snake oil in the form of PQE. The best opportunity might be a panel discussion involving monetary economists.

  32. I’ve just watched it. Yes, if you knew nothing of what he has said and written on BoE independence being a charade, a fiction then he seems very credible when insisting. G that he isn’t seeking to remove the bank’s independence. Of course you would also need to close your ears and ignore him then arguing immediately afterwards that the bank’s independence was a charade, a fiction…
    Just a little bit of knowledge bursts that credibility.

  33. Can we all just note – and then jump all over his blog on this point: he wants “a little bit of inflation, about 2%”.
    This is different to what he has previously said, very different. He is backtracking g on his great idea as fast as he can.

  34. Ritchie is clearly getting a bit worried about something. He’s put up a blog post saying that he doesn’t work for Corbyn etc etc, so someone somewhere must be starting to question his charity funding.

    Thing is, what we are experiencing here might be close to peak Murphy. As powerful and influential as he ever gets. Corbyn won’t win the next election so there is little likelihood that Murphy will form a part of government, and a post Corbyn Labour party will unlikely keep him on as an advisor either as he will be too tainted. Unless Corbyn makes him a Lord, then what we are seeing is pretty much as far as he is likely to get.

  35. “BC

    I have just listened to the cunt for the first time. Never again. I’d rather slit my own throat.”

    It’s why I won’t listen to the interview.

    I just think the stink of the sound of his voice would stay with me like a memory of seeing something awful like seeing a child being hit by a train.

  36. He did well, but his portrayal of PQE as a counter cyclical tool only to be used when all else fails us in complete contradiction to many earlier claims about it. Neil was not good, ignored this and kept blundering on as if Richie had said PQE to used at all times

  37. From the interview, The Murph said :

    PQE is not inflationary
    We need some inflation
    PQE is inflationary

    How can you have an argument with someone who contradicts himself at every turn?

  38. “diogenes

    How can you have an argument with someone who contradicts himself at every turn?”

    Murphy may have contradicted himself but he most definitely did not contradict himself.

    You are clearly wasting PROFESSOR Murphy’s valuable time.

    This is your last post here.

  39. Luis

    For me theost infuriating part of his pathology is this ability to keep a straight face, utterly repudiate what he believed with all his heart yesterday and deny ever having said what he has actually said a hundred times.

    The most infuriating; not the only infuriating.

  40. “Because they WANT to believe it to be true.”

    I think the Murphmonster, Piketty and Krugman have sussed that they can make a bomb flogging drivel to dim lefties as long is it confirms their prejudices.

  41. “Pils
    “Have you never considered that the man may well be a genius?”

    Yes, I have. No, he isn’t.”

    He could be a genius comedian that has us all fooled ; a sort of economics version of Borat ?

  42. Behold, the wisdom of Our Murph:

    “I went in resolved not to deal with any nonsense. For example, when he started making a silly assertions about Venezuela, I simply refused to engage with him – I said: ‘This is just not relevant, I’m not going to play on a silly territory that you define that has nothing to do with the debate that we are doing here,'” he said.

    Gah. He could always have tried explaining why, in his view, Venezuela is irrelevant. (It’s not irrelephant, it’s a hippopotamus!) But instead he throws his toys out of the pram, and then boasts about it afterwards to a journalist less likely to ask difficult questions. Why not try that explanation out on John Humphries next time he’s on Today?

  43. BiS

    “And thats one reason I’d cheerfully kick the shit out of anyone singing the virtues of 2% inflation targets”

    The BoE’s Chief Economist has a slightly different view!

    His remarks came as he made the case for raising the UK’s inflation target to 4pc from the current level of 2pc. Mr Haldane said that a trend towards low interest rates across the globe has made it increasingly difficult to fight off recessions.

    However a hike in the inflation target to 4pc would provide extra “wiggle room”.

  44. And to which an excellent rebuttal from Allister Heath.

    he believes in higher inflation now … he wants to abolish cash, force everybody to hold all their money digitally and give the Bank the tools to impose negative interest rates.

    This, he believes, would be the only practical way for central banks to loosen monetary policy in a world of very low rates and useless QE.

    Imagine that banks imposed -4pc interest rates on savings today: everybody would pull cash out and stuff it under their mattresses. But if all cash were digital, they would be trapped and forced to hand over their money. Why Haldane believes this would be more politically acceptable than extreme QE is a mystery; all spending would become subject to the surveillance state, dramatically eroding individual liberty. Many would start using rival currencies such as the dollar or euro, or resort to barter; sterling’s monopoly over the UK would soon end.

    Money is already too loose – turning on the taps would merely further fuel bubbles at home and abroad. In any case, I don’t buy the idea that QE is now ineffective (though Corbyn-style government spending monetisation would be a disaster). And we haven’t even tried Milton Friedman’s helicopter money idea.

    Haldane downplays the costs of higher inflation, especially for the poor and those on fixed incomes, and forgets that price rises have a nasty habit of becoming self-fulfilling. Calling for higher inflation also implies that the state is not serious about maintaining the integrity of the currency

    his solutions could hardly be any more wrong

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