Can growth really have stopped affecting inflation?

Posted By Andrew Sissons

14 November 2012

Mervyn King said this morning that he does not expect GDP growth to have much effect on inflation for the foreseeable future. That may sound mundane, but the ramifications are immense, for several reasons. For a start, as Chris Giles was quick to point out, it suggests that the Bank is unlikely to do any more QE. Taking it a step further, Duncan Weldon suggests that King has “thrown in the towel” on supporting the economy. If King is right, the government’s “monetary radicalism” approach is shot, and the fate of the UK economy now largely depends on the volatile tides of the global economy.

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Perverse incentives in the banking and finance sector

Posted By Stephen Bevan

29 June 2012

I guess that few people will be all that surprised by the latest tales of ‘dodgy’ practices in the banking and finance sector. The coverage of this scandal is re-visiting an assortment of related recent stories ranging from the adequacy of self-regulation, to banking and citizenship, to the moral equivalence between alleged fraud in the City and being jailed for stealing a bottle of water in the 2011 riots.

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Will the National Loan Guarantee Scheme provide a stimulus for the economy to grow?

Posted By Hiba Sameen

20 March 2012

In the run-up to the Budget, the Chancellor has announced the launch of the National Loan Guarantee Scheme as part of his credit easing plans to help the economy grow. The scheme guarantees, in the first instance, £5bn of funds (which is to increase to up to £20bn depending on the success of the scheme) for companies with a turnover of up to £50m at interest rates discounted by 100 basis points. The Federation of Small Businesses has recently reported that 60% of small businesses felt that credit was unaffordable – thus, this scheme should go some way to help reduce that burden.

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