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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: bond_bubble who wrote (51490)	1/26/2006 6:50:04 AM
From: shades	Respond to of 110194

Did you say PRICK? DJ BOE's Gieve: Intends To Serve Full Term On MPC -5- . Gieve was asked about Chancellor of the Exchequer Gordon Brown's fiscal policy. Gieve said if fiscal policy changed to "become more permissive," it could have an impact on monetary policy. But he said the MPC would have to consider the size of the fiscal policy adjustment before judging its precise impact. Referring to Brown's golden rule, that current government spending should be in balance with current revenue over the economic cycle, Gieve said the key point for the MPC is "what is going to happen from now on," rather than a focus on past performance. On the subject of asset prices, Gieve expressed caution about the idea that monetary policy could impact on bubbles. "I am pretty cautious about the idea that interest rates can prick asset bubbles," Gieve said. "There is a great risk of getting it wrong." BOE policymakers have consistently said they don't target asset prices with monetary policy, but instead focus on the government-mandated 2.0% target for inflation. Talking about his role as deputy governor in maintaining financial stability, Gieve said it was important that the BOE didn't become "detached" from developments in financial markets. He admitted, however, that he had less experience in the City of London than his predecessor Andrew Large. Gieve said he was "less worried now than 18 months ago" about the potential for a crash in U.K. house prices. After several years of strong rises in house prices in the U.K., they moderated last year, though as yet there has been no severe crash in the market.