Printing Money

Now, I don't rate John Redwood in all areas, not least his ability to make us all curl our toes watching him mumbling his way through the Welsh national anthem, but he does seem to know what he's talking about when it comes to economics:

The likely exchange of letetrs [sic] with the MPC requesting permission to switch on the presses and the Chancellor likely to say “Yes” is a silly ritual designed to make you think the MPC is independent. If the MPC were truly independent they would tell the Chancellor a few home truths about the runaway borrowing and wasteful spending.

The MPC minutes mainly talk about activity, not inflation, despite their remit. They do acknowledge that the pound has lost one quarter of its value and this could affect inflation, but much of their discussion sounds like Gordon Brown telling us all it is a global rather than a UK problem. They conclude that the pound has fallen to rebalance the economy, and that it “could have been increased risk premia” - so that’s all right then!

Bang on the money as far as I'm concerned. Let's get one thing straight here - the MPC and the Bank of England are not independent. Members are appointed by Gordon and at the end of the day, answer to him.

Guido spotted the possibility of printing money months ago with the revelation that the BoE are no longer going to publish how much money they're printing. Turns out, of course, that he was right.

So do we move to Zimbabwe now then?