They have already cut rates to close to zero and playing with bank reserve ratios will make bugger all difference (do you even know what a reserve ratio is??). Even jobs in the middle east (that bastion of aviation) are starting to dry up.
Banks are not passing base rate cuts on because no banks prices mortgage loans off base rate... they use the SWAP curve which reflects their cost of funding the loans. if the SWAP curve doesn't shift 3-4 years out which is the average duration of a UK mortgage product (before refinancing) then they do not change rates... simple as that. Base rate is irrelevent for pricing new mortgages... unfortunately our retarded government and press have not worked this simple fact out despite having over 12 months to work it out.
We have a government that is desparately trying to generate inflation to inflate its way out of this debt mountain but with asset prices falling eveywhere it cannot even do that (well not for at least another 12 months). First glimmers of recovery are 2010 at the earliest. Plan for recruitment to returns 2012 earliest.
2009 is going to be a bloodbath. We are probably 75% of the way through the financial crisis but on 25% max of the way through the economic recession. Your talk about "artificial tinkering" is off the mark... the bank of england and government have not "tinkered"... they have thrown absolutely everything they have at this and frankly are now just resorting to printing money hence the collapse in sterling and the German Finance minister calling Gordon Brown an idiot (which is something I think most people would agree with).
Last edited by getoffmycloud; 22nd Dec 2008 at 16:14.