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The plan is to restore real interest rates to a level of about 2 per cent.

So he does know what a real interest rate is then.

To continue to justify this policy of high interest rates

2% is not a high real interest rate.

11 thoughts on “Aha!”

  1. The plan is to restore real interest rates to a level of about 2 per cent.
    The plan is more economic disaster, then. Nice to know Labour hasn’t changed.

  2. But don’t worry:

    UK faces shortage of skilled workers for in-demand roles, report suggests

    The analysis found that the UK has a ‘pressing need’ to address its skills shortages or it risks falling behind international peers.

    Over a million immigrants every single year – the largest human migration to these islands in thousands of years of recorded history – and we have “skills shortages”.

    Honk honk! 😀

  3. and we have “skills shortages”

    It’s just that the new population is differently skilled, more into knife-work and rapine.

  4. Sorry! I read the heading as “Anal”, and thought it was another article about Murphy. I suppose being right, one out of two times, is OK now and then?

  5. I’m confused, I’m sure JP Murphy did a video where he said that the real interest rate is the rate people get paid by their banks, and that the standard economics definition was wrong.

    Anyone would think he makes it up as he goes along

  6. I can remember real interest rates of -10%; to Murphy a rate of +2% is “high” – it works against his aim of impoverishing those less spendthrift than he and confiscating (“taxing”) everyone else’s savings to splurge on his pet projects.

  7. Exactly John. Anything below Time Preference+Risk+Inflation is a direct transfer from savers to borrowers. Our money goes to keeping debtors afloat.

  8. Looking at the Bank of England site, real rates are ~3% now, depending on how much you trust the inflation figure, I suppose. 2% real isn’t much of a change.

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