Wednesday, July 21, 2010

U.K. seems to be moving to monetize its debt

What makes you think the Fed (here in the USA) is not doing the same thing? Watch what is done, not what is said.

The British government denied that it plans to inflate away debt, but its actions suggest that is exactly what it intends to do, according to The Economist. A program
by the government's National Savings and Investments that paid the rate of inflation plus 1% was closed because of its runaway popularity. Meanwhile, the Bank of England recently bought more than enough debt to fund the deficit for a year, a classic debt-monetization technique that dates back to Germany's Weimar republic, The Economist notes.

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