Aha, a proper forecast!

But the really interesting figure is on unwinding quantitative easing. Apparently, the economy is going to grow so much that it will be able to absorb more than £200 billion of quantitative easing reversal, which we know will take money out of the economy, reduce share prices, reduce confidence, force up interest rates and reduce real demand in the economy. none of which is reflected anywhere else in the forecasts made.

If you can believe that you will believe anything. I do not. This is yet more magical thinking.

So gentlemen, set your calendars. Will there be £200 billion of QE reversal by 2027 or not?

8 thoughts on “Aha, a proper forecast!”

  1. Isn’t his point:

    “the economy…will be able to absorb more than £200 billion of quantitative easing reversal … none of [the effects of] which [are] reflected anywhere else in the forecasts made”

    rather than a prediction – nor even necessarily a rejection of the OBR’s prediction – about whether £200bn will be reversed?

  2. I note he is very concerned that reversing QE would “take money out of the economy, reduce share prices” . Is this the same Richard Murphy who has spent more than a decade decrying the way QE was done, saying all it did was inflate asset prices, making the rich richer? The same Richard Murphy who was adamant that it had therefore been a failure?

  3. Henry

    Actually you’re very wrong my friend. Today he wrote a post approvingly citing g the OBR as expert evidence for the disastrous effects of Brexit. And today he wrote two other posts explaining what a bell-end everyone at the OBR is.

    Today is Thursday for all three posts.

  4. Butt… If you even attempt to quote El Spuddatoriat on his own words, you get blocked…
    And he is not important enough to actually be quoted in anything really relevant/prestigious, so any reminder will have “no significance”….

    Honestly.. The guy is only useful as a lythmus test: Does it align with the Notoions of the Elyan Sage?
    If yes… Bollocks to that..

  5. Depends on the meaning of reversing QE:
    If you don’t roll the bonds over when they mature, that’s not really a reversal (i.e. selling them back).
    And if you do roll the maturing bonds over, you are just inflating them away as the price level rises. £875bn say of rollover will represent a lower chunk of real money between 2023-2038 than it was between 2008-2023.

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