A stealth raid by the Bank of England has stripped savers of more than £170billion, a Money Mail investigation can reveal.
By slashing the base rate to a record low of 0.5?per cent and allowing the cost of living to soar for more than four years, the Bank has whittled away the value of cash sitting in High Street accounts through a ‘secret tax’.
And it is not just savers who have effectively had their money pinched. Anyone who has a fixed monthly income, such as pensioners, or has had a tiny pay rise, has also lost out.
I campaign constantly against the injustice which is being manufactured by our centrally-planned system of money and bank credit so I am glad that the arguments are going mainstream.
We are in the midst of a great battle between debtors and creditors. Deeply indebted governments are on the side of those in debt. Too many claims on real goods have been created by bank lending so now the central banks are destroying those claims by stealth.
The implications for our society will be profound. I cannot help thinking that the whole enterprise would have already come crashing down if the public could see the tens and hundreds of billions of Pounds – and Dollars and Yen… – as paper in wheelbarrows going to governments’ favoured friends.
Given that the alternative is higher interest rates, sound money and a painful correction, governments and central banks think they are taking the easy way out. We’ll see.
- Coggan, Paper Promises: Money, Debt and the New World Order (A surprisingly bold title for The Economist’s Buttonwood columnist and capital markets editor)
- Schlichter, Paper Money Collapse: The Folly of Elastic Money and the Coming Monetary Breakdown
- Dowd and Hutchinson, The Alchemists of Loss: How Modern Finance and Government Intervention Crashed the Financial System
This article was previously published at SteveBaker.info.