The injustice of easy money is going mainstream

How keeping rates at a record low is a deliberate government ploy to pay off its debts

The Daily Mail reports Interest rates: How keeping them at a record low is a deliberate government ploy to pay off its debts:

A stealth raid by the Bank of England has stripped savers of more than £170billion, a Money Mail investigation can reveal.

By slashing the base rate to a record low of 0.5?per cent and allowing the cost of living to soar for more than four years, the Bank has whittled away the value of cash sitting in High Street accounts through a ‘secret tax’.

And it is not just savers who have effectively had their money pinched. Anyone who has a fixed monthly income, such as pensioners, or has had a tiny pay rise, has also lost out.

I campaign constantly against the injustice which is being manufactured by our centrally-planned system of money and bank credit so I am glad that the arguments are going mainstream.

We are in the midst of a great battle between debtors and creditors. Deeply indebted governments are on the side of those in debt. Too many claims on real goods have been created by bank lending so now the central banks are destroying those claims by stealth.

The implications for our society will be profound. I cannot help thinking that the whole enterprise would have already come crashing down if the public could see the tens and hundreds of billions of Pounds – and Dollars and Yen… – as paper in wheelbarrows going to governments’ favoured friends.

Given that the alternative is higher interest rates, sound money and a painful correction, governments and central banks think they are taking the easy way out. We’ll see.

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Comments & Responses

3 Responses so far.

  1. waramess says:

    It is unbelievably great that this insipid stealth tax is now getting a public airing but, will it do any good?

    So long as our “small government” right wingers continue to support this “big government” of (apparent) left wingers I suspect the concern will go away as fast as yesterdays Mail.

    There is no real and sustained opposition to the policy of low interest rates and I daresay that most MP’s don’t really understand what it is all about anyway.

  2. AV says:

    Your a Conservative Steve you should have a word with DC. You always choose your words carefully because you know the BofE is just monetizing the government debt, because a weak PM has delayed difficult choices. Blame Carney all you want, all he will do is make vague reasons for continuing QE. Targeting employment, and even if employment miraculously falls below that target, he will the find another reason to print more, oh the guild yields have.. or inflation levels… he cannot stop, until the difficult choices are made, and interest rates will be kept low until the debt becomes manageable, the rest is just central bank newspeak.

    • Steve Baker says:

      Of course I choose my words carefully but the relevant people at the top of Government are well aware of my views, which have been stated plainly enough in public and private. Apart from all the speeches in Parliament and blog posts here, look on the back of Schlichter’s Paper Money Collapse and you’ll find my endorsement.

      Either the political leaders of the world are trapped within the errors of mainstream economists or they are right and money creation will solve the problems it created. We will surely find out.