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Wednesday, September 22, 2010


Despite Vince Cable's speech to the Liberal Democrat conference today, in which he refers to "murky corporate practices" and notes that "capitalism kills competition"; the capitalist world to which he refers is the world that he, and the rest of us, live in and rely upon for our survival.

To this end, ie the survival of our capitalist economy, the Bank of England are considering a further economic stimulus.

The recent Monetary Policy Committee (MPC) minutes show that there is a gradual movement within the committee towards doing more to support the economy. Given that interest rates are at 0.5%, the main alternative open to the Bank is that of further quantitative easing.

The US Federal Reserve has already signaled that it may restart purchases of government debt, ie quantitative easing. Given that the US and UK central banks are coordinating their monetary policy, it is highly likely the the Bank of England will follow suit.

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