Taxes and Interest rates Watch

R1C3W1N3
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When more money is spent than the volume of output produced we get inflation...

Govt rolls out quantitative easing -> people have more disposable income -> they buy more products -> unexpected sales lead to shortages in stock -> high/higher sales figures lead to increased prices for profit?

Is this what's happening, In a very basic explanation?

Also, what are the percentages for tax and the rate for interest?
I have read 0.5pc on some sites but duno where to start on reading and revising this...

High taxation during economic growth is a bad thing and could lead to a double dip recession, but what is a high figure?

Interest rates are set to stimulate the economy but also to prevent inflation... low? rates will mean people can borrow with low interest payments? Which could lead to more DI?
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balotelli12
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No it isn't!
Q.E. Doesn't get to the consumer. Virtually no one has had a pay rise in at least 2 years.
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meenu89
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(Original post by R1C3W1N3)

Also, what are the percentages for tax and the rate for interest?
I have read 0.5pc on some sites but duno where to start on reading and revising this...
http://www.hmrc.gov.uk/rates/it.htm for tax (scroll down a bit).

Bank of England interest rates are 0.5%
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R1C3W1N3
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(Original post by balotelli12)
No it isn't!
Q.E. Doesn't get to the consumer. Virtually no one has had a pay rise in at least 2 years.
No to which part, not all of it?
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Pipsico
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(Original post by balotelli12)
No it isn't!
Q.E. Doesn't get to the consumer. Virtually no one has had a pay rise in at least 2 years.
It wouldn't primarily be in the form of a pay rise.

QE is mainly to benefit the banks, the idea is that they recur their rates and increase lending to consumer. Of course, high capital rationing leaves banks nervous to lend so I would imagine very little reaches the consumer.

QE is nice in theory, bad in practice at the moment.


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Pipsico
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Recur = reduce


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Quady
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(Original post by balotelli12)
No it isn't!
Q.E. Doesn't get to the consumer. Virtually no one has had a pay rise in at least 2 years.
QE has made it easier to borrow, which has been passed on to the consumer. Also lower mortgage rates have lead to higher disposible income.
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balotelli12
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Oh Yeah it is so easy to get a mortgage is it?
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Quady
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(Original post by balotelli12)
Oh Yeah it is so easy to get a mortgage is it?
Easier than it was, particularly for the 15 million+ current mortgage holders to remortgage at the end of their deal - or moved the SVR down considerably.
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Rubenslash
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When more money is spent than the volume of output produced we get inflation...
Not sure what you mean with this sentence. If the UK spends more money than the output they produce, they are effectively importing more goods/services than they are exporting, leading to a negative current account on the balance of payment.
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