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> On Thu, Mar 5, 2009 at 2:05 PM, EDWARD wrote:
> Though at 0.50% there’s not much more room to fall in any event and he is trying to
> establish support for the new quantitative easing policy announced today.
*KING SAYS WE’VE SEEN SUDDEN, SEVERE DOWNTURN ACROSS THE WORLD
*KING SAYS `WE’RE VERY CLOSE TO ZERO’
*KING SAYS BOE IS INJECTING MONEY DIRECTLY INTO THE ECONOMY
> This perhaps is ‘injecting money’ but only by narrow definitions of ‘money’ that do not
> include the securities purchased by the BOE.
> They are simply buying financial assets, which is the exchange of one financial asset
> (balances at the BOE) for another- securities held by the private sector.
> Net financial assets held by the private sector remain unchanged.
> While these purchases can put downward pressure on interest rates for the asset class and
> maturity purchased, any ‘profits’ the BOE makes from interest earned on the securities it
> buys vs its cost of funding represent interest income removed from the private sector.
> Note his interest in helping ‘savers’ which means higher rates:
*KING SAYS KEY RATE IS AS LOW AS IT’S SENSIBLE TO GO
*KING SAYS HE’S KEEN TO GET BACK TO POSITION TO HELP SAVERS
*KING SAYS VERY UNLIKELY U.K. INTEREST RATES WILL GO ANY LOWER
*KING SAYS VERY UNLIKELY INTEREST RATES WILL GO ANY LOWER
*KING SAYS SAVERS SEEM TO BE SUFFERING THROUGH LOW RATES
*KING SAYS HE HAS ENORMOUS SYMPATHY FOR SAVERS