Letters to the Editor – 27/01 – Carney’s low rates, Bonus cap, Best of Twitter
Carney’s low rates
[Re: Mark Carney has been the luckiest of unlucky Bank governors, Friday]
The author puts his finger right on the key point when he highlights the issue of mounting imbalances due to low rates. But by the time the pressures become serious and can no longer be ignored, we will have to endure a rapid rise in rates, which will cause immense stress on those with large debts (mostly mortgages) and in turn on their lenders. It is reckless beyond all imagining to wait for that. We should be raising the base rate now in an orderly fashion while we still can.
Clarke Pitts
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Bonus cap
[Re: Bank salaries jump to cancel out bonus cap, Friday]
An increase in base salaries is a predictable consequence of the move to cap bonuses in the banking sector. It is also a problematic one. By limiting bonuses to no more than a year’s salary (or twice that level with the approval of the bank’s shareholders), institutions will be unable to alter payouts according to the financial health of the firm. Bonuses can be reduced dramatically to help keep a company solvent when it is in financial difficulty, but it is far more difficult to alter base salaries.
Miranda Bell
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BEST OF TWITTER
Over 60 Lib Dem and 140 Labour peers slowly killing the EU Referendum Bill with new amendments.
@dylsharpe
UK households still extremely indebted yet private consumption continues to be the main growth driver.
@minefornothing
Only surprise about the collapse of forward guidance is that anyone’s surprised.
@AndrewLilico
To see Davos’s upbeat mood in reality, need business heads to use their healthy balance sheets and invest.
@DrGerardLyons