24 Aug 2012

Quantitative Easing - a fantastic deal for the very wealthy

The Bank of England has published a report in which it admits that the effects of its Quantatative Easing strategy has mainly benefited the top 5% of households, because they hold 40% of financial assets. You can read the full report here, and it was discussed in an article in today's Guardian - "Britain's richest 5% gained most from quantitative easing - Bank of England".

I had a look at the report, and one figure particularly grabbed my eye. It was the distribution of financial assets - the figure where you get to see that 40% of the assets are held by 5% of households.

I can imagine that in the break down was even finer, it would have been even clearer. The assets held by the top 1% of households will certainly be even more skewed, and the relative advantage would be even more eye watering.

Can we seriously be expected to believe that QE is a sensible way to put central bank money into the economy? It clearly  goes to people who are highly likely to move their assets out to tax-havens. The probability of anything even remotely like "trickle-down" is zero.

No comments:

Post a Comment