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Monday, July 01, 2013

Farewell Mervyn King - Total Failure


The British honours system doesn’t always get it right.  Fred Goodwin and Jimmy Saville were two that I re-salutated from Sir to Scumbag long before their titles were removed.

Mervyn King is another one who needs to be dethroned.

There are many who seem to in praise of Mr King, mostly due to his record on taming inflation.  Inflation was indeed a major economic problem for the UK for several decades, however for the first two thirds of Mr King’s reign, it was targeted at 2% and mostly achieved.  Inflation it seemed, had been tamed.

But why was this?  Was it the setting of interest rates newly under the command of the Governor of the Bank of England, and his monetary policy committee?  Or was it Thatcher’s defeat of the unions?  Or was it the influx of cheap goods from China?  Arguably it was a combination of all three factors, plus a variety of other lesser factors.  Certainly not just Gordon's stooge.

However the targeted rate of inflation was not the rate that included house prices.

The house price boom, encouraged by the Bank of England and the Labour government, made possible by extremely clever bankers and allowed by wholly inept regulators was under Mervyn King’s watch.  This boom was totally unsustainable and should have been stopped long before the crash.

Further to this, Mervyn King also presided over the worst crash and economic downturn in living memory.

This is a total failure and I wholeheartedly wish to say Fuck Off Mervyn King.  Stooge of the socialist gold-seller.

I offer a cautiously optimistic welcome to his replacement, all the way from sensible Canada – Mark Carney.

Whilst I believe that revolution is the ultimate goal for The Bank of England, evolution must be the order of the day given the sensitivity of the economy.

For me, the sooner that interest rates rise and stop rewarding the reckless borrowers, and punishing the sensible savers, the better.  Sadly, given the precarious nature of the recovery, now is probably not the moment.