UK Economic Policy
We are familiar with the normal Bank of England policy of changing interest rates, which deals with the price of money. When the price of money falls there is typically an increase in demand for it, and thus an increase in the volume of money in the economy. Unfortunately, in the current state of nervousness about financial conditions, the volume of money in the economy has been contracting, despite falling interest rates. It is hoped that "quantitative easing" might resolve this.
March 5th, 2009
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