First, I contributed to quantitave easing on Wikipedia.
Now, Ask the Deputy Governor offers the following 16 questions addressed to the Bank of England with their answers.
Aware of the Bank of England Act 1694, I comment not as an economist, but from the perspective of a mathematician, systems analyst and software diagnostician, formerly at CERN, looking at “money” and its purpose:
- 1. Given inflation has only just fallen below the Government’s 2% target, why is the Bank of England adopting such a large unconventional policy measure?
- The effects of monetary policy on prices and real activity only come through after long and somewhat variable lags.
Comment: 2% inflation of consumer prices is only possible when measuring inflation extremely short-term. The Office of National Statistics keeps writing about annual inflation, while also gathering monthly data.
Inflation as “price inflation” is only one aspect. The real inflation is the supply of money as currency for the nation as a whole, which should be called “monetary inflation”.