I guess a lot of us have read Merv the financial pervs statement from this evening GMT. I did, took a coffee, and then proceeded to do what I am apt to do when irked, and awake and at uncivilised hour. Yep, I went and looked at the European Central Bank website.
What, you dear reader do not… oh, shame on you, as it can be very informative; although in this instance I was hoping it would put me to sleep as, you see, I am suffering from a mixture of euphoria at almost having finished my work here in Hangzhou, and so able to return home to France (I am British for those that do not know, am paid in Sterling, but of course have to watch what occurs with the Euro), and insomnia after drinking snake blood with my Chinese hosts in order to recognize the near completion of this contract, and entering of the dragon for the Chinese New Year.
I’m not sure if I should go and hang my head over the toilet bowl and get rid of the stuff – especially as they mixed it with whisky… to help digest it, they told me.
Anyway, inflation and pushing money out of the central bank via the back door.
The graph below is from the ECB website: http://www.ecb.int/mopo/html/index.en.html
One can see that inflation was nicely falling prior to the introduction of the Euro – some massaging of figures I guess prior to the event, and to help the public believe that a single currency would lead to a level, and cheap trading/living zone. Pah! What a load of crap… the PIIGS' retailers just moved the decimel point in the original currency price and thus killed cheap holidays and food.
Anyway, the Euro comes, a jump in inflation occurs – possibly teething problems, and then settles at the 2% mark that the ECB wanted. Of course, the bourses and banks got out of control, and so we had the crash of 2008, followed quite expectedly by a jolt down, and then an immediate surge north. Of course, those bastards in Brussels have been fiddling the books ever since, and so the current inflation rate reported, if true, at the very least shows that printing is running full pelt as most Europeans, and I include the UK here after reading Merv’s comments, have seen no wage/disposable wage increase for many a year.
I’d put inflation quite a lot higher, but the measures by which inflation are ‘officially’ recognized change almost quarterly. Add to this the fact that in moving to CPI figures for the UK and Europe, this captures about only 50% of true inflationary rates - rather deliberately, I would purport - it would be wise to take a closer look at the percentage hidden in the marvel of M3 money supply.
Couple these thoughts with the very sly EU circulation of large denomination notes, and not small five and ten Euro notes (http://www.ecb.int/stats/euro/circul.../index.en.html)
…and it is quite clear that QE probably never stopped.
What, you dear reader do not… oh, shame on you, as it can be very informative; although in this instance I was hoping it would put me to sleep as, you see, I am suffering from a mixture of euphoria at almost having finished my work here in Hangzhou, and so able to return home to France (I am British for those that do not know, am paid in Sterling, but of course have to watch what occurs with the Euro), and insomnia after drinking snake blood with my Chinese hosts in order to recognize the near completion of this contract, and entering of the dragon for the Chinese New Year.
I’m not sure if I should go and hang my head over the toilet bowl and get rid of the stuff – especially as they mixed it with whisky… to help digest it, they told me.
Anyway, inflation and pushing money out of the central bank via the back door.
The graph below is from the ECB website: http://www.ecb.int/mopo/html/index.en.html
One can see that inflation was nicely falling prior to the introduction of the Euro – some massaging of figures I guess prior to the event, and to help the public believe that a single currency would lead to a level, and cheap trading/living zone. Pah! What a load of crap… the PIIGS' retailers just moved the decimel point in the original currency price and thus killed cheap holidays and food.
Anyway, the Euro comes, a jump in inflation occurs – possibly teething problems, and then settles at the 2% mark that the ECB wanted. Of course, the bourses and banks got out of control, and so we had the crash of 2008, followed quite expectedly by a jolt down, and then an immediate surge north. Of course, those bastards in Brussels have been fiddling the books ever since, and so the current inflation rate reported, if true, at the very least shows that printing is running full pelt as most Europeans, and I include the UK here after reading Merv’s comments, have seen no wage/disposable wage increase for many a year.
I’d put inflation quite a lot higher, but the measures by which inflation are ‘officially’ recognized change almost quarterly. Add to this the fact that in moving to CPI figures for the UK and Europe, this captures about only 50% of true inflationary rates - rather deliberately, I would purport - it would be wise to take a closer look at the percentage hidden in the marvel of M3 money supply.
Couple these thoughts with the very sly EU circulation of large denomination notes, and not small five and ten Euro notes (http://www.ecb.int/stats/euro/circul.../index.en.html)
…and it is quite clear that QE probably never stopped.
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Author of: For Pip's Sake! (Available at Amazon... :-) )
I subscribe to Money and Markets and Uncommon Wisdom (Larry Eddlestone). He seems to have a firm grip on the REAL situation. Yes, I don't loo forward to the US printing aftermath.
