March 21, 2007
FLASH: UK central banker comes clean: Admits causing housing bubble for short-term gain, leaves financial catastrophe for others to deal with
That's not the case folks. The US and UK central banks are evidently made up of incompetent, clueless, morally-questionable boobs, driven by short-term business profits and serving their political masters, who could care less about the societal and personal destruction caused by their misguided, short-sighted, greed-inspired ways.
Here's a startling and bizarre admission from UK bank governor Lord Eddie George, where he admits he and his crew inflated the biggest bubble the world has ever seen simply because they thought they had no other short-term option to deal with the 2001 slowdown.
Here's one they should have considered in 2001 - go into recession. Taking that medicine then would have prevented the bubble, and prevented the biggest asset crash in recorded human history now underway.
You should all be outraged, sickened... and not surprised.
The Bank of England deliberately stoked the consumer boom that has led to record house prices and personal debt in order to avert a recession, the former Bank Governor Eddie George admitted yesterday.
Lord George said he and his colleagues on the Monetary Policy Committee " did not have much of a choice" as they battled to prevent the UK being dragged into a worldwide economic slump by slashing interest rates. And he said his legacy to the current MPC was to "sort out" the problems he had caused.
"We only had two alternative ways of sustaining demand and keeping the economy moving forward - one was public spending and the other was consumption.
"We knew that we were having to stimulate consumer spending. We knew we had pushed it up to levels which couldn't possibly be sustained into the medium and long term. But for the time being, if we had not done that, the UK economy would have gone into recession just as the United States did."
He said he was "very conscious" that stimulating consumer demand could give rise to problems in the future. "My legacy to the MPC, if you like, has been 'sort that out'," he said.