tag:blogger.com,1999:blog-2948538160252327076.post8801526657579299284..comments2023-11-02T15:48:50.381+00:00Comments on UK Bubble UK Economy: Interest rates going up?Alice Cookhttp://www.blogger.com/profile/05753570123987780947noreply@blogger.comBlogger5125tag:blogger.com,1999:blog-2948538160252327076.post-45377846743071183542008-06-10T16:14:00.000+01:002008-06-10T16:14:00.000+01:00Raising interest rates tends to increase the value...Raising interest rates tends to increase the value of the currency in question, so it therefore takes less pounds to buy a given amount of oil or wheat, all other things being equal.<BR/><BR/>Of course, monetary considerations are only part of the picture, along with demand/supply fundamentals like population growth and oil production, and speculative activity by people fleeing the equity markets.powermanhttps://www.blogger.com/profile/13670631915567128744noreply@blogger.comtag:blogger.com,1999:blog-2948538160252327076.post-53511393647771910012008-06-09T10:09:00.000+01:002008-06-09T10:09:00.000+01:00How does the BOE raising interest rates help reduc...How does the BOE raising interest rates help reduce the price of oil or wheat?<BR/><BR/>Inflation is a following measure, not a leading one. When the economy crashes high interest rates will kill us. Inflation will collapse anyway as people have no money to buy anything.<BR/><BR/>The real measure of inflation is RPIX and that is steady and about to fall.CityUnslickerhttps://www.blogger.com/profile/15929544047783163175noreply@blogger.comtag:blogger.com,1999:blog-2948538160252327076.post-51349429770454606152008-06-06T22:38:00.000+01:002008-06-06T22:38:00.000+01:00oil up to $139, definitely time for a global inter...oil up to $139, definitely time for a global interest rate hike.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-2948538160252327076.post-62276304568484113282008-06-06T10:12:00.000+01:002008-06-06T10:12:00.000+01:00As I understand (reading between the lines) King's...As I understand (reading between the lines) King's strategy, it is to accept that we will have inflation running high - averaging maybe 3%+ for a year... but not worry about that. The view, I think, is that a major recession is inevitable and that alone will dampen inflation. I'm certainly seeing anecdotal signs that the economy is slowing rapidly and that unemployment will rise.<BR/><BR/>I can certainly see the logic in this... and consider it far preferable to the US approach. Conversely, I can't help wonder if it is going to be a combination of commodity prices and taxation that cause the recession this time around... coupled, of course, with the abrupt curtailing of both portfolio and direct investment which are essential to fund new projects.<BR/><BR/>If anything is going to force central banks' hands it will be the price of oil. Suddenly, 118p/l for unleaded doesn't seem such a high price to pay.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-2948538160252327076.post-55332185228682381802008-06-06T10:11:00.000+01:002008-06-06T10:11:00.000+01:00Hopefully the BoE learned from the Fed: You can lo...Hopefully the BoE learned from the Fed: You can lower interest rates as much as you like but that big slosh of new liquidity won't be going into housing<BR/><BR/>NickAnonymousnoreply@blogger.com