What is to stop Gordon Brown printing money?

I'm still getting up to speed on my economics, but the book I'm reading says a way for governments to pay off bonds if for them to print the money. So what is to stop Gordon Brown and new Labour/ new Tories
printing money to pay off the enormous debt?
It may cause inflation, but not if taxes rose, and the labour market was opened to increased immigration, and imports. Also a big inflation would solve the problem of excessive mortgage and personal debt, and increased gilt yields would solve the pensions crisis.
Is this the real reason why the gold price is increasing, because there are plans to print money?
Add pictures here
<% if( /^image/.test(type) ){ %>
<% } %>
<%-name%>
Add image file
Upload
Dave wrote:

If you print more of it, the value drops. Inflation causes massive instability in the public finances, and in peoples personal finances. It makes credit to start up new businesses very expensive, it makes the nation not a good investment destination. It causes massive pay demands from workers to keep up parity.
It is very easy to print money, it is very easy to screw up an economy. A global marketplace can spot a fraud like that, and will punish accordingly.
Gaz
Add pictures here
<% if( /^image/.test(type) ){ %>
<% } %>
<%-name%>
Add image file
Upload

At the expense of business, personal savers, pensions you name it.
Old Labour did this and turned the country into a basket case. We really did nearly go under.
UK Ltd had to be bailed out by the IMF and the terms of the loan quite correctly imposed financial disciplines that many in Old Labour couldn't stomach (as usual the left in denial) hence them pushing the self destruct.
Supposedly, we now have an independent BoE so now longer under Brown's control.
As for inflation solving personal debt - f**k em.
One thing, at the first sign it does happen, draw out all your savings and borrow like there is no tomorrow then buy the best house you can afford. The pain will be all gone inside two years provided you can ensure a few 'meaty' pay rises so get yourself in a good union, nowadays this means public sector, otherwise without pay rises you will be f**ked.
It really could be something for nothing, in the short term, which of course is the problem.
Add pictures here
<% if( /^image/.test(type) ){ %>
<% } %>
<%-name%>
Add image file
Upload
allan tracy wrote:

I saw some pickets outside a government office today, which did make me a bit nostalgic. They had a union banner, and there were more than 6 of them.
Add pictures here
<% if( /^image/.test(type) ){ %>
<% } %>
<%-name%>
Add image file
Upload
Ok, they may not have been on strike. They may have been protesting about the next-to-non-existent enforcement of the working at height regulations by the HSE. (Dozens of builders are killed each year, a lot more than police who get all the publicity.)
Add pictures here
<% if( /^image/.test(type) ){ %>
<% } %>
<%-name%>
Add image file
Upload

Not necessarily true where variable interest rates apply.
Add pictures here
<% if( /^image/.test(type) ){ %>
<% } %>
<%-name%>
Add image file
Upload
On 17 Jan 2006 13:29:07 -0800, "allan tracy"
mysteriously appeared thru the usenet mist to inform us thus...

You shouldn't forget Anthony Barber nicknamed "Barber The Printer".

--
"It [Blair's government] has exploited the mood of insecurity
to push through a law protecting itself from public protest."
  Click to see the full signature.
Add pictures here
<% if( /^image/.test(type) ){ %>
<% } %>
<%-name%>
Add image file
Upload


Indeed, the good old Barber Boom :- http://hicks.nuff.ox.ac.uk/users/cameron/papers/monetary.pdf
The old boy passed away last month.
Add pictures here
<% if( /^image/.test(type) ){ %>
<% } %>
<%-name%>
Add image file
Upload
mysteriously appeared thru the usenet mist to inform us thus...

The inflation of the 70s was partly a consequence of his printing habits, although history has largely allowed him to get way with it.

I must have missed that on the news.
--
"It [Blair's government] has exploited the mood of insecurity
to push through a law protecting itself from public protest."
  Click to see the full signature.
Add pictures here
<% if( /^image/.test(type) ){ %>
<% } %>
<%-name%>
Add image file
Upload
typed:

inflation is tax...

that is precisely how it works...you are catching on

what increased guilt yields....where are you proposing these yields come from?

there are always plans to print money... it is a matter of how much they can get away with this week....
as for gold it is almost certainly just one more bubble
http://www.abelard.org/inflation.htm http://www.abelard.org/value-transfer/egold-info.htm
regards....
--
web site at www.abelard.org - news and comment service, logic,
energy, education, politics, etc 1,544,346 document calls in year past
  Click to see the full signature.
Add pictures here
<% if( /^image/.test(type) ){ %>
<% } %>
<%-name%>
Add image file
Upload


Remember that he is talking about big inflation which may lead to high interest rates but not necessarily economic growth. In this worst case scenario with rampant unemployment caused by economy contraction, excessive morgage and personal debt problems are solved but not in the desired manner.

------

------
Add pictures here
<% if( /^image/.test(type) ){ %>
<% } %>
<%-name%>
Add image file
Upload
On Tue, 17 Jan 2006 23:51:58 GMT, "Acute Angina"
typed:

i'd rather the poster decided what they 'were talking about'
--
web site at www.abelard.org - news and comment service, logic,
energy, education, politics, etc 1,544,346 document calls in year past
  Click to see the full signature.
Add pictures here
<% if( /^image/.test(type) ){ %>
<% } %>
<%-name%>
Add image file
Upload

If current monetary policy is still in place, then the increased interest rate implemented to counter the inflation would result in increased gilt yields wouldnt it?
--
John Boyle

Add pictures here
<% if( /^image/.test(type) ){ %>
<% } %>
<%-name%>
Add image file
Upload
On Wed, 18 Jan 2006 00:14:54 +0000, john boyle
typed:

that sounds plausible...
it is hard to know just what is in your mind.... eg...do you propose that these higher rates of 'interest' are going to also be inflated away?
it is really not sensible to think in terms of 'interest rates'...much better to think in terms of money supply..... that is the way it actually works/is implemented.... eg...contracting the money supply drives up interest rates by normal supply and demand mechanisms....and vice versa....
in this post your q. is strictly about gilts...but i would expect you to want to think that through in terms of other effects... everything interacts...
regards....
--
web site at www.abelard.org - news and comment service, logic,
energy, education, politics, etc 1,544,346 document calls in year past
  Click to see the full signature.
Add pictures here
<% if( /^image/.test(type) ){ %>
<% } %>
<%-name%>
Add image file
Upload

I think it is more than plausible, its a fact. Gilt yields have a direct correlation with BoE interest rates.

--
John Boyle

Add pictures here
<% if( /^image/.test(type) ){ %>
<% } %>
<%-name%>
Add image file
Upload
On Wed, 18 Jan 2006 09:02:09 +0000, john boyle
typed:

true....but then the price of oranges today has a direct correlation with the price of oranges tomorrow...
--
web site at www.abelard.org - news and comment service, logic,
energy, education, politics, etc 1,544,346 document calls in year past
  Click to see the full signature.
Add pictures here
<% if( /^image/.test(type) ){ %>
<% } %>
<%-name%>
Add image file
Upload
mysteriously appeared thru the usenet mist to inform us thus...

Eventually markets usually punish governments who print money. It's always tempting to start the printing machines but never advised.

In the overall scheme of things, it's more likely because Greenspin in the US has been pumping up the US money supply for the last ~15 years causing huge bubbles, first the dot.com bubble then the housing bubble, now it's the gold bubble. He's a bubble blower.
--
"It [Blair's government] has exploited the mood of insecurity
to push through a law protecting itself from public protest."
  Click to see the full signature.
Add pictures here
<% if( /^image/.test(type) ){ %>
<% } %>
<%-name%>
Add image file
Upload
On Tue, 17 Jan 2006 23:21:09 +0000, hummingbird
typed:

the empiric consensus is the ~2.5-3% inflation helps economic adjustment

warning: this is arrant nonsense oft repeated by the likes of buzzy and others who do not understand the american monetary situation and policies
--
web site at www.abelard.org - news and comment service, logic,
energy, education, politics, etc 1,544,346 document calls in year past
  Click to see the full signature.
Add pictures here
<% if( /^image/.test(type) ){ %>
<% } %>
<%-name%>
Add image file
Upload


One problem is the precise degree of control. Adjustments could simply inject instability, or swings, into the economy.
Add pictures here
<% if( /^image/.test(type) ){ %>
<% } %>
<%-name%>
Add image file
Upload
On Tue, 17 Jan 2006 23:51:57 GMT, "Acute Angina"
typed:

certainly...this a *major* problem with printing 'too much' money...
--
web site at www.abelard.org - news and comment service, logic,
energy, education, politics, etc 1,544,346 document calls in year past
  Click to see the full signature.
Add pictures here
<% if( /^image/.test(type) ){ %>
<% } %>
<%-name%>
Add image file
Upload

BeanSmart.com is a site by and for consumers of financial services and advice. We are not affiliated with any of the banks, financial services or software manufacturers discussed here. All logos and trade names are the property of their respective owners.

Tax and financial advice you come across on this site is freely given by your peers and professionals on their own time and out of the kindness of their hearts. We can guarantee neither accuracy of such advice nor its applicability for your situation. Simply put, you are fully responsible for the results of using information from this site in real life situations.