The lackwits and illiterates are now in full cry. If only we were to cut interest rates, then we could begin to ameliorate the downturn and prevent a savage recession. After all, place banks in that position and then we could see that they are just acting in a conspiracy. So says John Wright, national chairman of the Federation of Small Businesses:
"We are asking for the MPC not to dilly-dally until Thursday but to take the initiative early on Wednesday so that it sends the right message," he said. "A lot of our members are being asked to pay more for their overdraft and more for their loans, and a cut in interest rates would put the bank managers under immense pressure to explain why on earth they are increasing overdraft rates and loan rates at a time when the Bank of England is reducing them."
"A full 1pc cut would make it glaring that banks were up to their old tricks if they did not pass it on."
After all, money that is not paid back to the banks can be used to increase consumer spending. Same old economy, same old drive. The problem is that the model is bust. Money is more expensive and too many people have spent their or my hard earned cash now and lived on the never-never. Reduced consumption is here to stay until such times as the deleveraging of the economy is complete.
Since everybody requires more capital, it seems perverse to reduce the price of money and, in turn, destroy incentives to save. Of course, there should be some suitable deals as the government bail-out is limited.
The final apotheosis of Brown's Britain is Micawberesque misery, as all that debt returns to roost, and a savings culture is laid to rest, ready to rise again if the state no longer sucks up resources for the sole purpose of re-electing New Labour..