Higher interest rates. Great idea. Here’s why it won’t happen

The Bank of England, IMF and other policymakers see ongoing low rates as dangerous but can't see how to change things. There is a way, of course "

For some time now savers have campaigned for a return to normal interest rates, by which they mean central bank rates more like 4%-5%. And it's not just about earning more on their savings. This protest against the current 0.25% base rate also has a broader, altruistic bent. At least that is what they honestly believe.

They argue that higher interest rates will restore a lost balance in the economy - taking it back to the way it was before the financial crisis, when things were so much better.

Continue reading...