To give Halligan his due, both he and the Sunday Telegraph eventually realised that a proper debate was needed. Early last year an article with our different positions took up a full page of the paper. (There was even a video of a discussion between Halligan and myself, which is still available online.) At long last I obtained a proper inflation forecast — sort of. To quote Halligan, “I’ve often stated that, once bank lending recovers, we could easily see 6 per cent to 7 per cent inflation . . . I stick to that prediction.”
It is now 18 months since our video debate and well over six years since the first round of QE. What has happened to inflation? The answer is that the UK, like most advanced countries, is at present experiencing the lowest inflation over a sustained period since the 1930s. In the year to June 2015 the consumer price index was unchanged. All the respected forecasters expect subdued inflation, or even no inflation at all, for about another 18 months.
Perhaps more fundamentally, the average annual increase in the consumer price index since QE (that is, since March 2009) has been 2.6 per cent, a figure which by late 2016 is likely to be about 2.0 per cent, bang in line with the official inflation target. Will Halligan eat humble pie and admit he was wrong? Apparently, the answer is no. His Sunday Telegraph column on August 9 again condemned QE as “a slippery slope, as some of us have been warning for years”. QE had become “a grotesque, self-serving lifestyle choice of our financial and political classes”.
QE has indeed evolved into something of that sort. To be precise, it has become a grotesque, self-serving lifestyle choice for Liam Halligan himself. He makes much of his living by writing rubbish about it. The saga of QE-phobia at the Telegraph Media Group has gone on far too long, and Halligan’s editors should tell him to grow up and shut up. As anyone sensible can see, QE’s allegedly populist and irresponsible “money printing” has not led to a big rise in inflation, and it is not about to do so.
It is now 18 months since our video debate and well over six years since the first round of QE. What has happened to inflation? The answer is that the UK, like most advanced countries, is at present experiencing the lowest inflation over a sustained period since the 1930s. In the year to June 2015 the consumer price index was unchanged. All the respected forecasters expect subdued inflation, or even no inflation at all, for about another 18 months.
Perhaps more fundamentally, the average annual increase in the consumer price index since QE (that is, since March 2009) has been 2.6 per cent, a figure which by late 2016 is likely to be about 2.0 per cent, bang in line with the official inflation target. Will Halligan eat humble pie and admit he was wrong? Apparently, the answer is no. His Sunday Telegraph column on August 9 again condemned QE as “a slippery slope, as some of us have been warning for years”. QE had become “a grotesque, self-serving lifestyle choice of our financial and political classes”.
QE has indeed evolved into something of that sort. To be precise, it has become a grotesque, self-serving lifestyle choice for Liam Halligan himself. He makes much of his living by writing rubbish about it. The saga of QE-phobia at the Telegraph Media Group has gone on far too long, and Halligan’s editors should tell him to grow up and shut up. As anyone sensible can see, QE’s allegedly populist and irresponsible “money printing” has not led to a big rise in inflation, and it is not about to do so.
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