Another “hero” speech from Brown
Mr Brown told energy ministers that the high oil prices of recent years had stoked inflation and forced governments to keep interest rates much higher than would have otherwise been the case.
Oh yeah, 5.75% interest rates! That’s so high! What is the point he is trying to make? If interest rates were lower we wouldn’t be in the mess were in today? Wait, let me recap back to the reason were in this mess. Was it because people were very diciplined with regard to taking out credit while interest rates were so low? Oh wait, it was low interest rates and worthless western economies running on consumerism. Can you imagine the mess we’d be in if rates were already lower. BoE certainly wouldn’t have any room to cut, not that cutting the rates is going to make much difference anyway.
What a jobsworth.
Oil was high for a relatively tiny period. It was a bubble that started as an effect of this financial mess, not the cause of it. Roll on deflation, our crappy economy cannot continue as it was. Deflation is bad in the short term, but in the long term it will filter out the crap and make people realise you cannot built an economy on spending alone.
Deflation will favour people who have cash and savings. It will reverse the effect of all these interest rate cuts that are killing savings. On the flipside it will amplify debt. I’m not sure how countries as a whole deal with debt write offs.
Source: http://news.bbc.co.uk/1/hi/uk_politics/7791269.stm
Update: http://news.bbc.co.uk/1/hi/uk_politics/7791985.stm
Nice, someone from OPEC agrees. Yes Mr Brown. Why don’t you cut taxes? Is it because you are a labour jobsworth with an Ideology synonymous to your party’s voters who want to get paid to do nothing?
