Tuesday, June 26, 2007

Bumpy road ahead

Interest rate are on the rise everywhere. Was the years of non-inflationnist growth just an illusion ?. If so the BoE might try to reach the handbrake. It might be quite tough in the next years...

"If you run a very expansionary monetary policy and the historical conjuncture happens to be such that you get no inflation, what do you get? The answer, of course, is asset price inflation and deterioration of credit. This is the troubling legacy of policy that we are now left with."

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