An IOU - quantitative easing explained
Charlie Bean tours the country explaining away IOUs and commentary on the latest financial developments
The Bank of England’s deputy governor, Charlie Bean, has been touring the country to explain its quantitative easing policy. He described the Bank’s purchase of government debt and some corporate assets from the private sector as “IOUs drawn on the Bank of England”.
“The people who sold us the assets will have more money in their bank account when they bank their cheques and we would expect them to do something with that,” he continued. “More money feeds through and that helps to boost spending.”
Is this a self-brainwash? Is it a Marvin Gaye-style romanticism by way of a revamped lyric from ‘Sexual Healing’, namely “hen I get that feelin’/I’ve got quantitative easing”? Sorry, readers – couldn’t resist…
In entertainment (or rather, less entertaining) news, BBC Worldwide’s profits for 08/09 went down to £85.7 million from the year before’s more healthy total of £117.7 million. The global arm relies on programme rights and spin-offs, and seems to have been affected by the demise of retailers such as Woolworths and Zavvi. Profits from the commercial arm are being used to refill the depleted piggy bank of Worldwide, but is that just a short-term solution? Time will tell.
Following the Guardian’s reveal on The News of the World’s phone-tapping, the Serious Fraud Office have been less touchy. Richard Alderman, director of the SFO, told The Times of a new “hardnosed” drive where suspected fraudsters would face covert surveillance in order to catalyse the process and tackle fraud in a more proactive manner. This is legitimated under the Regulation of Investigatory Powers Act 2000.
In the world of paternalism and ridiculousness, French travel agencies have launched a new insurance cover, giving rise to claims by those who feel their holidays have been spoiled by bad weather. Yes, really. Pierre et Vacances and FranceLoc will allow claims if the sun-seekers’ holidays have been interrupted by at least four days of rain in a week. Quick, book with them now! Preferably a holiday to Manchester…
Back to reality, there has been talk of the government introducing a compulsory charge of somewhere in the region of £20,000 payable per person on retirement in order to cover the cost of care in old age. Experts have described the current system as an unsustainable lottery, but this solution would have to reach some sort of compromise in order to avoid the charge of unfairness just due to the year its subscribers were born. There’s a lot of work to be done there.
