QE IS IT WORTH IT
Please
find below a link to a recent Financial TV interview between myself and
Monica Gibson of Dukascopy TV, discussing the likelihood of QE in the coming
weeks.
We
examine the probable timing and scale of QE, the impact it is likely to have on
the markets, the slow disintegration of the integrity of the bond markets, the
effect on pension plans and savers, of long term low or negative interest
rates, the fiscal cliff and the plan by Romney to halt QE and fire Bernanke.
To
listen to the broadcast please click on the link:
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I am
very pleased that thanks to Dukascopy TV, my message is reaching an ever wider
audience.
A fine interview, indeed. Yet will not continued QE invariably lead bond holders of those sovereigns at the core of the trans-Atlantic banking system (i.e. Germany, the U.K. and the U.S.) to see things much the same way as already has been displayed throughout the euro-zone periphery, whereby there will be growing awareness that today's claims will not possibly maintain their purchasing power and therefore are better sold, thereby leading to rising rates in core trans-Atlantic economies and creation of a massive negative feedback loop ushering in conditions to rival 1923 Wiemar Germany?
ReplyDeleteI agree with your comments. QE will solve nothing and already extensive bond buying is done by central banks in the absence of genuine buyers. It is clear that the debts cannot be extinguished in todays money so the only solution is to inflate away the debt, which is ongoing. Anyone buying bonds is guaranteed to lose at the end. If interest rates rise which already would have happened but for perpetual manipulation via operation twist etc the economy will collapse. In the US an interest rate of say 5% would take almost 25% of the federal budget and push the colossal deficit way higher.
ReplyDeleteEither way the system is doomed to collapse.
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