The government doesn't buy bonds, they sell them, then pay a guaranteed revenue to who ever buys them for the duration of the bond.
Occupy London! Here we go again!
- Thread starter LateX'Dog
- Start date
The government doesn't buy bonds, they sell them, then pay a guaranteed revenue to who ever buys them for the duration of the bond.
So the city is ultimately more important than industry was?
We should have bailed out the banks, but to continue with the 'City is Best' moto is going to scupper this country badly in the long run.
We have created a new quasi political industry which is now accepted as being the norm, except this industry is inherrently risky and dangerous with little safeguard which can always resort to bullying the taxpayer into distorting the market on its behalf and ensuring their survival when it is not natural for it to happen.
The problem being is unfortunately it is in our immediate interests because of the distorted reliance on financial industry, but it doesn't make it anymore morally correct because of it.
The government doesn't buy bonds, they sell them, then pay a guaranteed revenue to who ever buys them for the duration of the bond.
In QE they buy them back, it's called open market operations. That how they place new capital in the system.
What you just said, is the goverment is buying bonds back usally at a higher price.
The funds are then using that money to buy them back at a lower price then what the goverment bought them.
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Council house? There hasn't been a new one in years in my area AFAIK... Housing Association house... There are loads in the development just over the street, in fact a certain amount have to be built in most developments. A lot of councils have moved their council house stock over to the Housing Associations too as IIRC they are the privatised version of council housing...
EDIT: http://en.wikipedia.org/wiki/Housing_association
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The government is buying bonds
The government is buying bonds
Yes, that what they do in QE. They create money, then they have to place that money in the system.
How do they do this? They buy goverment bonds, and the money placed in the hands of the ex-bond holders, that used to hold the bond.
Not hard to understand.
It seems it is in your case. The government is not buying bonds.
Goverment is paying money, to receive their own bonds from people that
used to own them. How this not buying bonds?
If funds are buying more bonds, we are completely screwed.
The government is not doing this. If they were buying bonds, then yes they would be buying bonds, but they are not.
How are they doing QE then. Traditionally that's how they do it. It's called open market operations, usally how the central bank implements monetry policy.
![[TW]Fox](/data/man-of-honor/2009.png){kind=avatar}
See what I mean? There is much confusion amongst most people about what is actually going on. How can people protest against something few of them understand? It makes no sense. Most of them are there because somebody on Facebook told them go to and they thought it would be cool - 20somethings have railed against the establishment for decades...
[TW]Fox;20318455 said:
There few academic books on how central banks implement montery policy. This where my knowledge comes from, academic books.
In these books QE happens in the following way:
Central bank creates a liabillity on their balance sheet for the newly created money
They place the money into economy by buying goverment bonds.
People who had goverment bonds, and sold them now have that money
They place that money in a bank, thus increasing bank capital.
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And you think thats true of everyone standing around with placards whinging?
The government isnt buying anything - the central bank is. The BOE is an independant public organisation, it does not take orders from the government.
The BoE are creating money to buy bonds from pension funds and private assets and so on. These organisations then spend the money, in the case of pension funds, quite likely spending it on more governement bonds as part of the investment portfolios as it provides a guaranteed income for the future.
The government continues to sell bonds to pension funds, the international markets and anyone else with a few quid to spend so that the public debt continues to increase and so on.
The BoE sits on the bonds and at some point in the future (maybe) they will sell the bonds back to the market to remove the money that was created initially as part of QE. They plan to do this at some point when normal levels of money supply return so that the money they take out doesn't have a noticeable impact.
Sorry Biohazard, you wasted your typeface as I was playing devil's advocate. I pretty much agree with you old bean.
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Read up on the UN Agenda for the 21st century (Agenda 21), it's pretty much what the supposed leaders of these 'occupy' movements are calling for.
Sure a lot of the protesters have good intentions in mind, but if the movement has been hijacked then we're all ~censored~ as more and more people join the protests the nearer to economic collapse we get.
Here's also an interesting bit of info, the following url is linked to the UN plaza
Paulina Arcos ( the wife of a leftist Ecuadorian Foreign Minister )
866 United Nations Plaza
Suite 516
New York, New York 10017
United States
http://15october.net/
The footer: People of the world, rise up on October 15th!
Registrant of;
http://nycga.cc/
is a correlation trader for HSBC
This whole movement stinks. You've got all the socialists supporting it, Al worldgovernment Gore is supporting it. Most of the protesters have no idea what they're doing except trying to be political in their youth. They're being misguided. If they think things are bad now, they're going to regret giving away their individual rights to the United Nations which is run by the same banking families and Monarchies who these protesters are apparently protesting.
In effect, the 1% who run the world have managed to convince the masses that the Agenda 21 socialist style of government is the best way forward. No private property, no rights, government poking its head into every little bit of your life, assigned jobs given to you by the state. State education.
The protesters should be outside Buckingham Palace, the Bank of England or any of the Rothschild palaces.. but they're not...they're doing the same damn thing that is happening in New York and protesting ' wall street ', what does that even mean? Wall Street is made up of people like you and me who want to make money. You can't generalize like that.
Technically yes it is state owned, but it is used by the banking elite. Think of it like a middle man between government and commercial banks. There's a lot of secrecy surrounding the BoE as well, which is never a good thing.
Sure a lot of the protesters have good intentions in mind, but if the movement has been hijacked then we're all ~censored~ as more and more people join the protests the nearer to economic collapse we get.
Here's also an interesting bit of info, the following url is linked to the UN plaza
Paulina Arcos ( the wife of a leftist Ecuadorian Foreign Minister )
866 United Nations Plaza
Suite 516
New York, New York 10017
United States
http://15october.net/
The footer: People of the world, rise up on October 15th!
Registrant of;
http://nycga.cc/
is a correlation trader for HSBC
This whole movement stinks. You've got all the socialists supporting it, Al worldgovernment Gore is supporting it. Most of the protesters have no idea what they're doing except trying to be political in their youth. They're being misguided. If they think things are bad now, they're going to regret giving away their individual rights to the United Nations which is run by the same banking families and Monarchies who these protesters are apparently protesting.
In effect, the 1% who run the world have managed to convince the masses that the Agenda 21 socialist style of government is the best way forward. No private property, no rights, government poking its head into every little bit of your life, assigned jobs given to you by the state. State education.
The protesters should be outside Buckingham Palace, the Bank of England or any of the Rothschild palaces.. but they're not...they're doing the same damn thing that is happening in New York and protesting ' wall street ', what does that even mean? Wall Street is made up of people like you and me who want to make money. You can't generalize like that.
Technically yes it is state owned, but it is used by the banking elite. Think of it like a middle man between government and commercial banks. There's a lot of secrecy surrounding the BoE as well, which is never a good thing.
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some of these socialists/anarchists (etc) are hilarious.
So they are buying bonds then(BOE is owned by goverment). It still involves
pension funds selling bonds for more than their price, then buying back at normal prices. Thus having
a net gain for free.
It's owned by the government (well technically the Treasury Solicitor), but it is not the governement. It's wholly independent.
They're not, they're paying market value for them.