Unintended consequences:

October 25, 2012

Trans Tasman adds to the criticism of the Green’s money printing policy:

. . . What’s played to the Govt’s advantage has been the Green Party’s advocacy of quantitative easing to solve the problem of the high dollar.

It has shown the electorate how a Labour-led coalition could be held hostage to extremist policies. QE in the NZ environment would lead to the destruction of income from savings, in turn leading to reduced spending, and inevitably to a contracting economy. So the thousands of NZers who rely on their savings income have been driven back into the National camp. The public is sceptical about solutions which sound easy but have unintended consequences.

Lack of savings is one of the contributing factors to our economic woes.

Any policy which would erode the real value of savings is bad policy.

 


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