Friday, 30 March 2012

Liam Halligan on the Dangers of Quantitative Easing ("QE")

Since its implementation by the BOE at the height of the financial crisis, QE has been a controversial policy to say the least. We at GreenWorld have always felt that QE has the potential to cause inflation - if not now, then down the road.  For those who share the same worry, there was a fantastic column by the Telegraph's Liam Halligan on the dangers of QE.  Mr. Halligan writes:
"Future inflation, not disinflation, is the problem the UK faces. For now, most of the QE “proceeds” are sitting on the balance sheets of banks pretending to be solvent...What happens to inflation when that massive increase in base money is leant out? What happens when the mask slips and the markets focus on “currency debasement”, which then pushes up imports prices as sterling falls?" 
Mr. Halligan is spot-on, the danger is indeed real.  If you are at all interested in this subject, do read the entire article here.  Once you read it, ask yourself, what type of investments would you want to protect against any inflation created by QE, whether in the UK or elsewhere?  As we noted in our previous post, the best kind of inflation hedge investments, are so-called "hard assets" that will rise in value along with inflation.  If you are interested in a hard asset that pays good current income, hedges against inflation and also has tremendous value, consider farmland investments.  We recently wrote an article on Technorati on how farmland investing is now increasingly accessible for individual retail investors. We would welcome the opportunity to discuss the following farmland investment options with you further - feel free to contact us at

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