Why is the Bank of England the second worst forecasting body in the world?

The last couple of days has seen me analyse both accountancy chicanery and yet another “surprise” rise in inflation in the UK. It has had the side issue of adding the word “spike” to my financial lexicon. Today we will receive the inflation report from one of  the worst forecasting bodies in the world which is the Bank of England. It is already being treated with far more seriousness than it deserves. For example Stephanie Flanders of the BBC   has pointed out that  the Bank of England could tell us that inflation might go up or down with the clear implication that it matters what they say. But taking these reports seriously like that is to make a mistake yourself. We do get a clue to likely Bank of England policy from these reports however we do not get any sort of guide to how the future will turn out unless you use it as an anti guide!

How bad is the Bank of England’s record?

It is simply shocking and I will illustrate by using the forecasting time period of two years and go back therefore to the Inflation Report of November 2010. Just to be clear the reason for the two-year period is that it is the period over which leads and lags operate before monetary policy changes operate at full power.

We see in the Governor’s introduction two regular themes

Over this period, the (inflation) projection is higher than in August

Yes they had underestimated future inflation yet again but in another regular theme (something Stephanie Flanders shares) we get this.

Further ahead, CPI inflation is projected to fall back

Okay so they may have had and let’s be polite, a little bit of trouble as Frank Spencer used to say, with inflation what about economic growth?

Overall, growth is judged to be a little more likely to be above its historical average rate than below it for much of the forecast period

As you can see the discussion of historical averages gives the implication of say 2.5% economic growth per year over the following two years. Indeed they say over that which gives us 5% plus. Actually UK GDP has risen from 102.4 in the third quarter of 2010 to 103.0 in the third quarter of 2012, so unless we are going to see 5% economic growth in the fourth quarter of 2012 the performance in the economic growth area is even worse than the inflation one!

What did they forecast for now?

Having got the period between then and now completely wrong there is of course the possibility that we might now be growing as they thought. However when I see a “fan chart” showing 3% economic growth at its centre I am unsure whether to laugh or cry. Even worse this was predicated on £200 billion of Quantitative Easing and we now have £375 billion of it which apparently according to ex-MPC member David Blanchflower is the “lifeblood” of our economy. So if they had put that into their equation they would perhaps be forecasting 4% economic growth right now. Ooops!

Rather interestingly if we look back from November 2010 we see that the fan chart tells us that the Bank of England forecasting record up to then was excellent as the actual GDP line is pretty much slap bang in the middle. An outstanding effort! Now if anyone can send me evidence that the Bank of England actually predicted an annual rate of fall of 6% in UK GDP for a while in 2009 I would be grateful. You see if you follow the advice of Kylie Minogue and “Step Back In Time” and look at the Inflation Report two years previous to 2009 aka February 2007 then you see a fan chart centering on 2.5% economic growth. That is +2.5% as opposed to -6% which some might think is quite a divergence.

It is of course possible that someone has placed fake Inflation Reports on the Bank of England’s website to embarrass them but then you hit the issue of why? After all they do a pretty good job of that if left to their own devices.

If we move onto inflation we see that the Bank of England was predicting that it would fall to 2% at the beginning of 2012 and then drift lower to approximately 1.6% now. It is of course 2.7% now. So above rather than below target which is an important nuance as I will discuss below.

Did the Bank of England do any better last year?

Let me keep with the theme of a famous Australian pop poppet and use her songs to demonstrate this. Now Mervyn if you are reading not this one.

I should be so lucky Lucky lucky lucky

You weren’t! No I meant this one.

I’m spinning around Move outta my way

You see Mervyn told us this.

Inflation fell back in October to 5.0%.

This is technically true as it had been 5.2% the month before but perhaps he will explain how it fell back from  a forecast of below 2% to 5%.

But we have not even left the Governor’s opening statement and we have another glaring error.

Real take-home pay should gradually begin to recover after a period in which prices have grown faster than wages.

Yesterday we saw that CPI inflation is at 2.7% and RPI inflation is at 3.2% and today have been told this by the Office for National Statistics.

Total pay for employees in Great Britain rose by 1.8 per cent

Unless there is some alternate universe going on here where mathematical rules are different then we see that real wages continue to fall.

If we move onto the main detail we see yet again that the Bank of England’s forecasting record up to that point was superb! According to itself anyway! However this does not quite seem to tally with telling us that inflation would be about 1% now (more inaccurate than a year earlier) also it told us that we would have had 1% economic growth over the past year rather than none.

But never mind because according to it economic growth in the UK is just about to surge to over 3% by this time next year. It is time for a bit of Earth Wind and Fire I think.

Take a ride in the sky
On our ship fantasise
All your dreams will come true right away

Comment

I have in the course of today’s post said that I would explain why this mistakes matter. The answer is simple which is that UK monetary policy has been set according to these incorrect forecasts and so by definition it has been wrong. A clear example of this is the way that Quantitative Easing has been expanded to £375 billion in an attempt to boost inflation because the forecast has been for the level of inflation to be below the 2% target when in fact it has been above it continuously for nearly three years.

Also if we consider QE we keep being told that it boosts economic growth which might make you think that as we keep getting more of it economic growth would be going well. Instead it has done the reverse.

To my mind the choice that one has is between the Bank of England being actually incompetent – at which they are doing a convincing job- or whether these are deliberate errors as part of some unspecified policy.

Moving onto today’s effort let me give you some initial thoughts. Mervyn seems to have had a complete change of mind here.

output growth is likely to fall back sharply in Q4 as the boost from the Olympics in the summer is reversed – indeed output may shrink a little this quarter.

Although he does have a brief flash of self-analysis and hence insight.

It is difficult to discern the underlying picture.

Also Sir Humphrey Appleby’s critique applies here I think

This does not mean that the MPC is no longer in control of monetary policy.

For those who have not come across this before let me hand over to Sir Humphrey.

Never believe anything until it is officially denied

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34 thoughts on “Why is the Bank of England the second worst forecasting body in the world?

    • Hi Kit

      No although they have tried their best/worst. No it is the troika operating in Greece because as recently as the May 2010 bailout the IMF plans forecast 1.2% growth in Greece in 2012 and so far we have around -7%. In total if we calaculate actual growth versus forecast we are at approx -23% now.

  1. Shaun, I think we all agree that the MPC and Sir Mervyn are paid to say one thing and do another. Nobody could be that incompetent, even by accident!

  2. From the FT today… “The combination of weak growth and higher-than-expected inflation results from a lack of slack in the economy, reducing the scope for a rapid recovery. The MPC now believes it cannot do much to rectify this problem and thinks it will last for a long time.”

    Im going in to work today and Im going to tell my boss that I cant complete my work any longer. I cant do anything about it and it might last for a long time… hmmm?

    This bunch of idiots really do take some believing.

  3. Yes, I think the BOE knew we couldn’t accept the truth so told a pack of lies for a while so that the truth could dawn on the population slowly. Either that or the general population knew the truth and the BOE were the ones “in denial.”

    • Hi Jan

      I quite like the “BOE were the ones “in denial.” myself especially over such issues such as the output gap which they now seem to realise was an error. Hip hip hooray!

      For those who have not followed this blog for as long as Jan has I have been arguing that the output gap theory has not worked in the UK for pretty much my blogging career of not quite 3 years.

  4. Hi Shaun, as you predicted, headline in today’s DT Business section- “Shock leap in inflation”. Whilst the BoE’ incompetence is mind-boggling, the inability of even supposedly well-informed journalists to see beyond the Govspeak is staggering. Your blog is an essential couterbalance to this, thank you.
    Just harking back to your “Dune ” ref., a month or two ago, is the problem that there are too many Harkonnens in business & public life these days, and where is Muad’hib when you need him?

    • Hi PieterC

      Actually as time went by in the sequels the Harkonnen position ebbed and flowed a bit. So who would be the Tleilaxu now?

      As for Muad’hib he was in the wilderness for a while gathering his resources was he not?

  5. It is clear that, as you state above, the key point is whether there has been an unofficial change of policy, or whether the Governor has not exercised accurate judgement either in forecasts or in analysis of the economy.

    The main concern surrounds the level of growth, which would have been experienced, had there been no Quantitative Easing.

    The criticism of the discrepancy with the BoE’s prediction and the 6% contraction that took place at the bottom of the cliff that economy fell off in October 2008 is a little harsh. The failure of many outside experts to predict either the timing or the level of the contraction has been well publicised. That said, the recent BoE forecasting record does certainly bare greater scrutiny and potentially leave the Bank open to greater criticism.

    Another point that is much less transparent and potentially risky both economically and politically is the extent to which the Governor of the Bank of England is still in charge of monetary policy. The timing of the £35bn transfer certainly assists the Chancellor of the Exchequer in preparation for his autumn statement and is hugely advantageous to him before a new Governor is selected. Massive outside pressure from OECD, IMF, European Commission, NIESR etc has been growing with regard to the realism of his deficit reduction targets for 2012-3. It will enable him to announce new “investment” in autumn, without increasing public spending.

    The contradictions in the evidence above, with the accompanying analysis and statements from the Bank of England could be accounted for through adjustments made in response to outside commentary, such as from Her Majesty’s Treasury.

    • Hi econoclast and welcome to my part of the blogosphere

      Are you the same as the person with that name in the FT? If you are I am pleased to see that you are coming into agreement with one of my themes which is that the Bank of England is not independent. In my opinion that ended when they needed the Chancellor’s permission to commence QE. But via the selection process the independence had been weakening anyway.

      • Hi Shaun,

        I am glad to see that you have eventually come around to my observance of this fact that the BoE was and never has been independent, and that this was demonstrated irrefutably by the MPC undertaking QE which they had no authority to do under their remit and thus had clearly been instructed by the Chancellor at that time to execute it outside their remit, with his express guarantee that there would be no sanction against them! I remember that you did not accept this when I first put forward this argument on your blog here some long while ago now, so I am pleased it appears that you have now come to accept that it is the case.

      • Hi Drf

        Thank you I will take a look. Also I had a look for when I first challenged the independence of the Monetary Policy Commitee of the Bank of England on this blog.

        Here are my thoughts from February 16th 2010

        Yes the Monetary Policy Committee is asleep to our inflation dangers and possibly deliberately so. In the way that their role has merged with government policy by using such measures as Quantitative Easing which required approval by the Chancellor of the Exchequer they are no longer the independent body that they were at their inception in 1997.

  6. Hello Shaun,

    In other news – oh dear shcok horror , Greece contraction greater than expected !!

    guess the BoE is not the only ones who can’t forcast their way out of a paper bag!

    Keep up the blog ! I need a touch of reality with all this News Speak from the BBC aka Minitru

    Forbin

  7. It seems clear the projections are massaged to justify whatever policy they have already decided to pursue e.g. inflation is always projected to be lower to justify QE.

    I think the mistake is to buy the propaganda that central bankers are guardians of the economy acting independently to safeguard the interests of the country. They are there to safeguard an economic system that has vastly benefited the wealthy and continues to do so. They are selected for that purpose.

    Perhaps we feel that we don’t do that sort of thing in UK. But whether its BofE, or the Orwellian sounding Office for Budget Responsibility or the BBC (even more cowed than before) – the public is increasingly being fed propaganda and lies.

    Ultimately any money system controlled by humans will be corrupted – its just a matter of time. We can munch our popcorn whilst watching this one implode.

  8. The most disturbing feature to all of this is that some still actually believe that the BoE, senior civil servants and UK government would admit and publish the truth of what they intend, when their intent is evil and malfeasant! Do you really believe that if they had decided that the only way out of the difficulties which they themselves have created after years of idiotic politics was to debase Sterling significantly, and they reasoned that they could only achieve that level of debasement by issuing various fraudulent government statistics, such as manipulated and falsified inflation numbers, manipulated and falsified GDP numbers, falsified money supply numbers etc., they would actually publicly state what they intended!!!! Of course not. If they had have told the truth there would have been panic! So they have done all of this clandestinely, and have published data for some while now deliberately to confuse and deceive. These people are pupils of Lucifer himself, and they follow his ways! The final outcome can be nothing other than great suffering and hardship for ordinary people (who are not part of the elite group organising this heist) struggling to earn a living and bring up their families.

    “To my mind the choice that one has is between the Bank of England being actually incompetent – at which they are doing a convincing job- or whether these are deliberate errors as part of some unspecified policy.” The later is thus the truth; they have acted deliberately as part of this unspecified evil and malfeasant policy, because if they had admitted the truth their gambits would not have worked, since even the reluctant would all have moved into gold and silver etc. before the hyperinflation which will now result in due course. King has the tongue of a serpent, as he demonstrated publicly today, and he can afford to be complacent because he like Faust has been promised that he will have plenty, and will be protected from what is to come..

    • Drf,

      consider – Theophilus of Adana, servant of two masters

      I’d not go as far as some of you comments but that some kind of Faustian Pact may have been entered into here by Mervin and the BoE.

      I certainly agree the “real” intent is not public and the likes of Mini Tru not asking pertinent questions is baffling if you regard them as independent……..

      As for who this country is run for, I certainly have no doubt the People are not considered !

      interesting times !

      Forbin

      PS: once you realize that your position is spectator , all becomes more bearable

      enjoy the show ! want some popcorn ?

      • Hi Forbin: I agree that we ordinary hard-working folk are spectators, but personally I cannot enjoy the show, since it is our country, economy and livelihoods which are being ruined! For those of us who are not very young any more it is much more worrying.

  9. Shaun

    Could we not ask the Aussie government for a swap:

    We gain the services of Kylie as Economic Forecaster to the Treasury.
    They get to keep Nadine Dorries* for… well, for as long as they like, really!

    *Who really is my MP. (No, I didn’t vote for her)

    • Hi Jim

      An excellent idea but I suspect even Richard Branson (the best UK salesperson I can think off) would struggle to find a line that might convince the Aussies!

      I have little faith in my MP either but that is because when I wrote to Jane Ellison about the UK economy she lost the email until I think at about the fourth time of trying a year later.

  10. Hi Shaun,

    An excellent, hard hitting blog and quite rightly so. :-))

    Lord King in one sentence says, there is a surprise rise in inflation, a few sentences later when talking about the longer term he says he would like to see a 25% devaluation of Sterling. Derrrrrrrrrrrrr, now with inflation consistently above 2%, what is a 25% devaluation going to do?

    Lord King and his side kicks consistently try to change history to justify their failures and use the rather limp excuse, that things were different to expected and would have been much worse if we hadn’t had QE etc. The simple answer is that we need the journalists to ask is: prove it. I think we will then see the emperor has no clothes.

    My perception of Lord King has always been the man is a politician and an economic fool.

    The problem with a fool is that the only person, that doesn’t realize they are a fool is the fool themselves, if they did they would do something about it!

    The basic problem we have is that all future predictions are a guess. Now in normal times, by using imperfect computer models, it is an informed guess. Since, 2008 economies have been in uncharted territory, so the computer models don’t work. Now I suspect with BOE, Treasury and Civil Service inertia, the updating of these economic models has not yet happened to try to model reality. This means that they will always been behind the curve and very wrong. Presently, I suspect informed gut-feeling guesses have more chance of success, but I suspect as civil servants, they would rather be consistently wrong, using ‘the system’ than apply some lateral thinking.

    Many years a go when I worked as a government scientist, we used to have a saying: “You can lead an administrative civil servant to knowledge, but you can’t make him (or her) think”!

    A much more honest approach in these turbulent times rather than the BOE trying to predict growth or inflation, relying on yet to happen events, would be to list a range of credible options based on likely events like the US fiscal cliff, the Eurozone crisis etc. But this will never happen as it would be an admission of what we know is that they don’t know, instead of their current absolute gospel which is consistent, consistently wrong!

    Yesterday, there was a doom and gloom report on why we will have below trend growth beyond 2020. Personally, I’m a bit more positive than that for the US due to shale gas and oil, dropping local energy prices will really start to make a big difference by 2017 and the BRICS I think will be more resilient than they have predicted.

    Europe and the UK are in trouble, our welfare models are unaffordable and our taxes are too high, particularly in UK for what is delivered. I read a report by a UK economic think tank about a year a go, which analysed the UK economy and came to the conclusion that with the current private / public sector balance no meaningful growth was possible now or in the foreseeable future without a massive re-balancing of the public / private sectors and tax cuts. Without that then we would be basically locked into a no growth economy.

    This no growth economy with inflation can only lead to one thing at best for the foreseeable future, stagflation. With the current band of inept politicians of all the major parties, the economy won’t be re-balanced, which can only mean one thing terminal decline. We will either eventually get a leader who is prepared to grasp the nettle and make the difficult decisions, which is unlikely or much more likely, events, my dear boy, events, will force changes, probably overseen by the IMF.

    • Hi Rods,
      I can’t really agree on all your points.

      During the Iraq war, part one, I recall prior to the conflict ‘war games’ were held that included ‘if it should rain in the desert’. I’ve not been there but apparently it does occasionally rain. It did. Without this preplanning vehiclles could have become bogged down.

      Since the close of WWII, the army has war gamed Germany [physical??] invasion of England in 1940 and in all four games it was a disaster for Hitler. Retrospectively they agree he made the right decision.

      We have Japan and many academics who have time, and although like the weather, there are many who will have an interest in ‘gaming’ events and outcomes. Even Excell boasts such ‘senario’ features for forecasting.

      Japan is a model where QE has been tried and our economy is mature enough for those who want to ‘game’ the senarios can do so.

      To be incompetent and ‘spin’ the forecast for so many years as the BoE has would surely require more than the capabilities of Capt Manwarring, Frank Spencer or any others.

      Therefore I subscribe to the idea that ‘they know’ whats coming and have therefore made plans for how its going to be handled – this being ‘what they are employed to do’. One of their first moves being of what they did, not what they said, was the changing of how the BoE pensions were index linked. And this set the horizon, never mind what they said their policy is.

      Agreed, the Stagflation will continue, there is no fix to this situation, but the ‘nettle’ to be grasped is not the difficult decisions to be made, since the ‘answers’ are being laid in Syria, Iran, the China Sea as japan and China rub swords. Everyone is in the same boat.

      We have over 25 million under 25 year olds unemployed within the Eu [have I understated this??] on strike and protesting through Italy, Portugal, Spain, Greece, Ireland = under employed = austerity imposed by the banks = collapsing the economy = an organised and cohesive plan to collapse the economy – otherwise they would be doing something else other than describing things as ‘on track’ as they get worse and worse.

      What better way to solve the problems by arming them with rifles and sending them off to war? All problems become soluable then – politically and financially.
      Problems solved for the USA, UK, France, Isreal, Japan, China.
      Employment opportunities for all unemployed.
      Reduction in bad assessts on banks books – dead debtors.
      Enahnced chances of meeting Green House emission objectives.
      Reset the property market. Reset banking by new currency.

      End result, centralise all banking activities, remove sovreign states, and start the whole thing over again as we did at the end of 1945 after blowing everything up, five years of war, and no one worried about the 1930’s depression any more and no one worried about why ‘black thursday’ happend in 1929 as the history books were neatly re-worded [spun??] to hide the real reasons of the depression – credit Crunch?? created by who??

      Its like watching a repeat of Cross Roads from 1970’s….
      I’m in for the Pop Corn. Too old to fight, too young to retire.

      At the risk of invading Shauns blog, this posting I put up on my site illustrates just how far folk lore and culture is used to hide what is ‘hidden in plain view’. Sit back and enjoy Steve Blanks Google presentation on The Secret History of Silicone Valley.

      http://www.concept9.co.uk/2011/09/hidden-in-plain-view/

      Sorry Shaun :)

  11. I am amazed that some of you still listen to the BBC and expect to be informed. I gave up listening Pravda GB a very long time ago, I think it was about the time Michal Fish assured the nation there was definately no storm on the way.
    It is interesting in a day of European wide strikes how many in the informed MSM continue to chant the mantra that the problems afflicting Europe are caused by ‘austerity.” So there you have it, abolish austerity and problem solved.

  12. Hi Shaun, today’s blog could almost be a direct reply to my comment yesterday. A comprehensive analysis and yet I would never have thought I would defend the BOE but, here goes: Yes their forecasting is wrong but notwithstanding the shambles over the previous 2 years, inflation this year has been within 1% of target which is OK to me. What is not OK is the failure of wages to keep pace with inflation.

    I also think, as you do I believe, the BOE has stepped in to try to fill a Policy vacum. This is outwith their remit and they should impress the importance of joined up economic policy on the Treasury pointing that they can only provide support from the sidelines – not take over policy!

    On the subject of inflation forecasting, whilst Mervyn should have spotted that his devaluation of the pound was bound to import inflation into the UK, it’s unreasonable to expect him to have spotted that the Commodity rally was going to continue and continue when most global economic indicators were for a slowing down of global growth. I still don’t understand the oil price given the World economy, can you explain it?

    On growth forecasts I agree, Mervyn should have worked out that with everywhere slowing down and the UK not really exporting vast amounts of GDP anyway, growth was set to take a hammering and he should have said so.

    I think his ambition for a further 25% devaluation in the pound hilarious. Hasn’t he worked out yet that all the other countries are involved in a race to the bottom? I am afraid that even if he goes to negative rates he will find himself the victim of diminishing returns as other countries cut their rates even further, thereby guaranteeing even more imported inflation.

    • oil price is raised by growing demand from BRIC / growing East Asian countries.

      Supply is constrained by diminishing output from old oil fields. Not so long ago oil was $10 a barrel – nobody invested to increase output. Hence supply shrinks with aging oil fields.

      Politically the enbargo on Iran is also restricting oil supply and may also cause a risk premium. Venezuala’s output has also plummeted due to poor management.

      • perhaps Shaun can help in describing what the Chicago school of economics would be like in a resource constrained world….

        my guess is that it would not be pretty

        Oil is a major resource issue , conventional oil has been at a plateau since 2005 , unconventional has proven harder to extract – and demand from the BRICs has not decreased like here in the west.

        The whole subject is quite large and explained elsewhere on the web for those
        who care to look.

        If you really want the pessimistic approach – look up Export Land Model

        Forbin

      • Thanks ExpatinBG but BRIC countries growth have slowed in the last couple years and aren’t the Saudi’s holding back on production? Perhaps a rigged market more than anything. I agree the Iran thing could cause an upward spike.

        Commodities remain elevated imo whilst China has port storage facilities overflowing with coal, iron ore and copper, yet still China buys more although not as much as she used to – why?

    • Hi Noo2

      I see you have plenty of replies so i will just reply on the remit bit.

      They needed to decide what they can and could do and what they could not. In short a difference between their view and mine is simply that I know and believe that a central bank has powers but only over some things. They felt they could extend that with a “this time it is different view…”. By trying to do everything they have done nothing.

  13. I agree with many of the comments made. The Austrian economic school has constantly made the point that all these kinds of central bank forecasts are pointless since such methods can’t predict market outcomes with any sensible chance of success. I’m sure, as others have pointed out, that they are meant to offer some kind of sop to general public opinion – rather like a ship that is going down and the captain keeps making reassuring noises over the tannoy that “all will be well in due course”. To me, the most irritating feature of the current financial crisis is that the mainstream media are so hopeless. Nobody (as far as I can see) makes any attempt to analyse what is going on with any depth. I am so thankful for blogs such as this one, because just imagine if all your information came from places like the BBC or national newspapers. Unfortunately, that’s where most of the population gets its news from, and therefore its views. “Austerity is wrong, let’s have a policy for growth”. No further thought is applied after those two phrases.It’s difficult to have a sense of optimism and I’m afraid I’m not sure the popcorn is going to be enough consolation!

  14. Of course the BOE has another agenda – one that is not politically palatable, so cannot be openly declared. In the period prior to 2008 the UK economy overcooked, leaving wages, growth assumptions, real estate, the City etc etc at artificial levels. The BOE is just doing its job now – in attempting to re-balance, and unfortunately this involves reducing real wages, the value of Sterling, the creation of inflation, all whilst protecting the UK bond market from a potential loss of confidence. The cost to the BOE is that it has to deliver this under the guise of incompetence.

  15. There will be two reports, the real one which is for internal consumption by the Treasury, BoE, etc and the massaged one for public consumption which is trotted out to keep the ‘sheeple’ in blissful ignorance.

    I just wish someone had the gumption to slip the first one onto Mervin’s desk so that it is read out at the press conference. Imagine the consternation as the real picture is read to the world and all hell breaks lose.

  16. The B of E cut interest rates to a 48 year low in 2003 when inflation was over target and annual HPI was 24.9%. Prompting an HSBC economist to say
    ##
    “”This is one of the biggest gambles any central banks has done – cutting rates when house price inflation is close to 30% and inflation is already above target,” said John Butler, UK economist at HSBC.

    “It is true to say [the Bank is] playing with fire.”
    http://news.bbc.co.uk/1/hi/business/2732645.stm
    ##

    So when they sit down now to form policy and forecasts what they must do is say “What do we need to do and say this time to try keep houses prices in a bubble, so we can pretend we didn’t create a bubble and they are just normal.” Low interest rates = tick, ignore inflation = tick, make up a phoney forecast = tick, try encourage reckless lending again = tick

    Living standards, savings, earnings, more hours to work instead of free time, women all at work instead of looking after children etc must all be sacrificed so the B of E don’t have to say they did something wrong.

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