The good news is that the Bank of England, under new governor Mark Carney, has demonstrated it cares about unemployment. Its ‘forward guidance’, published yesterday, means monetary policy, which is being used as an economic stimulus, will stay as it is until unemployment starts to come down.
The bad news, however, is that we are no closer to a coherent policy for kick-starting economic growth. The Bank is crossing its fingers in the hope that its current approach will start to bear fruit, in terms of employment, over several years.
Tolkein fans might have spotted that this article’s title is lifted from The Hobbit:
“Go back?” he thought. “No good at all! Go sideways? Impossible! Go forward? Only thing to do! On we go!” So up he got, and trotted along with his little sword held in front of him and one hand feeling the wall, and his heart all of a patter and a pitter.
As a step forward, the Bank’s plan isn’t very sure of foot.
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