Post by Joe
On Tue, 8 Aug 2017 15:12:41 +0100
Post by James Harris
A few things are worth picking out of this story in the Guardian,
e.g. UK total assets, the UK market's attractiveness to other
countries, and whom QE has helped the most.
A booming City and rising house prices provided a double boost to
Britons holding assets in 2016 as they pushed the nation’s wealth
through the £10tn mark, according to a new survey.
Is adding up all the house prices a valid concept?
IMO the total is meaningless. It's the direction of change which is
Post by Joe Post by James Harris
The Bank of England has acknowledged that the richest 10% of Britons
gained most from the money creation programme known as quantitative
easing, since the increase in the supply of credit boosted demand for
financial assets. Since the better off held a greater proportion of
these assets, 40% of the gains of rising share and bond prices went
to the richest 5% of households.
Or basically what I said a week or two ago, QE was helicopter money,
but designed only to land on carefully-chosen beneficiaries, thereby
avoiding inflation of general prices.
QE is certainly not spread evenly.
Post by Joe
The same has happened with all the big central banks, the Fed, the
ECB, BOJ etc. I'm surprised that the Guardian is willing to
acknowledge this, possibly the greatest theft in history.
One of the interesting things about the story was that the Guardian
published it. A similar surprise is to see the following positive
comments in the FT:
Signs are growing that the weaker pound is boosting demand for UK
manufactured goods, helping to reduce the country’s reliance on consumer
spending to drive economic growth.
Interviews conducted with at least 700 UK businesses during June and the
first half of July by agents of the Bank of England suggest activity has
picked up in export supply chains and that _UK manufacturers are
increasingly producing goods that were previously imported_.
This pick-up in demand, supported by the depreciation of sterling since
the Brexit vote and an acceleration of growth elsewhere in the global
economy, has encouraged some manufacturers to invest more both to
improve efficiency and expand capacity. Sterling has depreciated by 14
per cent on a trade-weighted basis since the Brexit referendum.
The BoE report, released on Wednesday, suggests manufacturers’ plans for
investment during the next 12 months remain stronger than they have been
at any time since spring 2015. Investment intentions among services
companies have also recovered during the past year, following a sharp
fall immediately after last summer’s vote to leave the EU.
Both stories are very different from the usual negative output of both