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Tuesday, 10 July 2012

Quantitative easing explained.

As we all suspected quantitative easing is just money created out of thin air.This person from the BoE confirms this as well as stating that its main function is to reduce the inflation rates to target levels.Surely though increasing the money supply increases inflation due to the increase in general level of prices and a fall in the purchasing power of money.
I must have heard it wrong because the BoE (even though its actually a private venture)would know what its talking about wouldnt it?

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