@shireblogger @frances_coppola QE has unwanted redistributive effects: financially asset rich doing well, those on wage income badly
— Stephen King (@KingEconomist) May 25, 2013
Frances Coppola, Shire Blogger, WEAYL, Pawel Morski
@kingeconomist @shireblogger Totally agree about QE.
— Frances Coppola (@Frances_Coppola) May 25, 2013
@frances_coppola @shireblogger Trend growth overstated pre-financial crisis - never clear why UK should grow much faster than European peers
— Stephen King (@KingEconomist) May 25, 2013
@frances_coppola @shireblogger This goes beyond hysteresis: with high levels of income inequality, reducing claims also damages trust
— Stephen King (@KingEconomist) May 25, 2013
@kingeconomist @shireblogger Then address income inequality as well as the waste of human capital that is hysteresis.
— Frances Coppola (@Frances_Coppola) May 25, 2013
@frances_coppola @kingeconomist establishment making good effort to regressively protect wealth - accomodative monetary policy an example
— Shire Blogger (@Shireblogger) May 25, 2013
@shireblogger @kingeconomist in a deleveraging economy, wealth protection measures by the rich are bound to increase inequality.
— Frances Coppola (@Frances_Coppola) May 25, 2013
@shireblogger @kingeconomist that sounds like a no-brainer but it's actually quite hard to work out exactly how that happens.
— Frances Coppola (@Frances_Coppola) May 25, 2013
@shireblogger @kingeconomist which is why I am struggling to explain why/how QE is deflationary as the evidence seems to show.
— Frances Coppola (@Frances_Coppola) May 25, 2013
@frances_coppola @shireblogger @kingeconomist QE maintaining high housing costs for example. Sucks money out of economy.
— WEAYL (@WEAYL) May 25, 2013
@weayl @shireblogger @kingeconomist Umm, don't think so. Many homeowners are paying lowest mortgage rates in history.
— Frances Coppola (@Frances_Coppola) May 25, 2013
@frances_coppola @shireblogger @kingeconomist as a % of income?
— WEAYL (@WEAYL) May 25, 2013
@weayl @shireblogger @kingeconomist Even as a % of income. And without low rate policies housing costs would be much higher.
— Frances Coppola (@Frances_Coppola) May 25, 2013
@weayl @shireblogger @kingeconomist think about it - of COURSE low rate policies support homeowners. Houses are wealth.
— Frances Coppola (@Frances_Coppola) May 25, 2013
@frances_coppola @shireblogger @kingeconomist Housing cost overburden rate in UK 3rd highest in EU.
— WEAYL (@WEAYL) May 25, 2013
@frances_coppola @shireblogger @kingeconomistonly Wealth only if someone has money to buy. Low rates supports wealth, but we need prosperity
— WEAYL (@WEAYL) May 25, 2013
@weayl @shireblogger @kingeconomist That's what I'm saying. Supporting wealth benefits ppl who have houses at expense of ppl who haven't!
— Frances Coppola (@Frances_Coppola) May 25, 2013
@frances_coppola @shireblogger @kingeconomist High house prices are tax on young - the people who should be starting businesses + families.
— WEAYL (@WEAYL) May 25, 2013
@weayl @shireblogger @kingeconomist not denying that, but historic problem due to overblown housing market - hasn't been allowed to correct
— Frances Coppola (@Frances_Coppola) May 25, 2013
@frances_coppola @shireblogger @kingeconomist exactly - QE has not allowed to correct.
— WEAYL (@WEAYL) May 25, 2013
@weayl @shireblogger @kingeconomist Realistically it is not QE that is to blame for housing market prop-up, really. Is low interest rates.
— Frances Coppola (@Frances_Coppola) May 25, 2013
@weayl @shireblogger @kingeconomist we shouldn't blame QE for EVERYTHING!!
— Frances Coppola (@Frances_Coppola) May 25, 2013
@frances_coppola So QE has no role in keeping mortgage rates low? or impact bank behaviour re granting loans? @shireblogger @kingeconomist
— WEAYL (@WEAYL) May 25, 2013
@weayl @shireblogger @kingeconomist Think it has very little effect on either. Low base rate MUCH more important in keeping mtge rates down
— Frances Coppola (@Frances_Coppola) May 25, 2013
@frances_coppola QE surely has also accumulated wealth, contributing to London froth. Made buy to rent artificially attractive investment?
— WEAYL (@WEAYL) May 25, 2013
@weayl @kingeconomist @frances_coppola as per @toby_n QE lowers pension discount rates, creates funding gaps, diverts corp money.Toby Nangle's posts on portfolio effects of QE, referred to by Pawel Morski, are here and here.
— Paweł Morski (@Pawelmorski) May 25, 2013
@weayl @shireblogger @kingeconomist and damaged banks don't lend - especially when under regulatory pressure to de-risk their bal sheets
— Frances Coppola (@Frances_Coppola) May 25, 2013
@frances_coppola @shireblogger @kingeconomist but wasn't QE supposed to mitigate that (even if only marginally)?
— WEAYL (@WEAYL) May 25, 2013
@frances_coppola Personally I see no1 goal of QE to prevent a financial market crash. Goal of austerity to offset inflationary risks of QE.
— WEAYL (@WEAYL) May 25, 2013
