Thought Id start this one going because its rather dead on this board at the moment and I suppose all my usual muckers are either at the Stella tennis event watching Dim Tim (lose again) or at Henly Regatta eating cucumber sandwiches (they wish,...NOT).

Anyway please feel free to just talk to yourself blast away and let it go on any company or subject you wish. Just wish Id thought of this one before.

cheers GF.

Theres the full report Haystack.


Rates must rise even if recovery falters, says Bank of England policymaker Martin


Weale

tweet0Print..Companies:MPCTopics:InternationalBoard & Management Changes.Related Quotes
Symbol Price Change
050540.KQ 2,250.00 -150.00


{"s" : "050540.KQ","k" : "a00,a50,b00,b60,c10,g00,h00,l10,p20,t10,v00","o" : "","j" : ""} Philip Aldrick, 20:25, Monday 13 June 2011

Interest rates should rise now to address soaring inflation even though doing so would hurt the already weak recovery, Bank of England policymaker Martin Weale has urged.

Mr Weale, a member of the rate-setting Monetary Policy Committee (MPC (KOSDAQ: 050540.KQ - news) ), told the Finance Directors' Strategy Meeting in London that an early move on rates is needed to preserve the Bank's inflation-fighting credibility and to give it more flexibility in the months ahead.

He also argued that taking some of the pain now might mean rates do not need to rise as fast as otherwise projected, providing an effective economic stimulus in the future.

The speech will position Mr Weale as the most hawkish member of the MPC since Andrew Sentance's term expired last month. He has voted for a quarter point rise to 0.75pc since January and has been joined by Spencer Dale, the Bank's chief economist. Mr Sentance wanted rates to rise to 1pc.

Mr Weale's comments come as the Office for National Statistics publishes inflation data for May on Tuesday. The key consumer prices index is expected to have been unchanged on April at 4.5pc, more than double the Bank's official 2pc target.

Mr Weale said he is concerned that "we have exceeded the inflation target in 34 out of the last 40 months".

"After such a record, the risks that expectations of above-target inflation will become entrenched must be greater than if our recent record were better," he added. "There is a strong case to pre-empt this risk rather than wait for it to materialise."

He acknowledged that "in the short term the performance of the economy will be weakened slightly" by raising rates despite warning that recent data already suggested "short term economic growth may be slightly weaker than we had hoped".

"But, if the underlying inflationary pressures are correctly judged, interest rates further in the future will be lower than is shown by the market profile and some stimulus to output is then likely," he added.

"An early increase makes it more likely that the inflation target can be met in two to three years time because it allows for greater subsequent flexibility... If the economy is extremely weak, interest rates can be reduced again."

His argument coincided with a bullish speech from Jean-Claude Trichet, president of the European Central Bank (ECB), who stressed: "We have seen in recent months upside risks to the outlook for price stability. The sharp increase in oil and other commodities has had a major impact on overall inflation.

"In these circumstances, the central bank must prevent increases in the prices of raw materials from being incorporated into the long-term inflation expectations, which could trigger second-round effects on wages and prices."

The ECB is expected to raise rates for the second time this year in July. In contrast to the Bank's record, Mr Trichet said the ECB had managed "a precision landing" against its 2pc target over the past 12 years

It is unlikely that interest rates will rise as the causes of the inflation are external factors such as rising commodity prices. Interest rate rises only combat inflation when it is caused by the economy overheating. Higher interest rates will just add costs to the economy and cause further inflation. In economic speak, commodities are price inelastic. That is to say that even when they go up people still have to buy them, such as food and fuel.

Has Fred done a runner?

If interest rates go up, who knows where we are going . When half the country are having problems paying the morgage now.

Hays,

Many would consider my qualifications better than Cameron's.

I would think that in that Cameron relied on a Crammer to get to Oxford he would utilise the same pathway for his degree.

He thought he was applying for Cambridge.

But, if you consider that many considered that he to partook of a few "noxious" compounds during his period there, his present patterns of thinking can be more easily understood.

I think you may find that you need more than a crammer to get a first at Oxford.

Hays,

You don't mean he paid for it?

Or was that he "old days".

===================
Actually, have a few friends who got 1st and Ph.Ds at Oxford. (They did get them on merit)

===================

NHS seems safer to-night.

Thanks to Prime Minister Clegg and the Liberals.


University education fee reversal next.

Great to see they can throw so much cash away by cutting back on overseas' students.

" Actually, have a few friends "

Your joking , your not including those nice men in white coats who give you your medication are you ?

Fred: Can I borrow 10p to ring a friend?
Reply: Here is 20p ring them all!

Why is Green Grass in the 1st spreads ad in the BB header?

Hays,

At the least I knew my parents.

ROFL - I see Fred has not totally lost it thinking Cameron relied on a crammer or bribery to get his PPE first. Trust me - it's not that easy.

I asked last night who does Fred resemble ?

Is everyone lost for words.LOL

Not visit the FRED thread for a few days till just now. Wish I had not have bothered.
Posters 'still' reply to his incessant rantings. Not worth a read.

Yes dc.

That sounds bad SC.

Hello , Fred Scuttle speaking is that Labour HQ ? right then , I demand that Gordon Brown be bought back to sort out this mess that the Tory Eton educated toff's have got us into , WHY you ask ? because he was only Chancellor for 13 year's you never gave the man a chance. CLICK [ sound of laughter as the phone is slammed down ]

Are you sure Fred is not Gordon Brown or even Tony Blair .

If it was either my money would be on him being Gordon.