Just watched Sir Nicholas Macpherson, permanant secretary at the Treasury, at a select committee.
His most interesting points were:
a] Quantative easing is a “journey into the unknown”. You can gauge its impact by yield movements in bond markets, said the mandarin. So far it seems to have been broadly positive, but it’s hard to say with much certainty. “We don’t understand every aspect of it and I’m sure it will keep academics busy for many years to come,” he said.
b] Macpherson admits that the tax system was unduly dependent on boom sectors. “With hindsight, some taxes were more geared towards the financial services sector and to housing, and revenues have fallen by more than GDP. That’s going to provide lessons for the future,” he said.
Jim Pickard
Kiran Stacey
