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Linda Young – AHN News Writer

London, United Kingdom (AHN) – The central bank left the key interest rate unchanged at 0.5 percent.

Bank of England’s Monetary Policy Committee (MPC) made the announcement on Thursday.

At the same time, the MPC resisted pressure to stimulate the economy further and said it would not extend its $321.38 billion quantitative easing program.

There are mounting fears that the UK is headed into a double-dip recession, which led to unsuccessful pressure on policy makers to further stimulate the economy.

Various economists have warned that they think eroding business and consumer confidence, a weakness of the money supply and the ongoing economic crisis in the eurozone are pushing the UK toward another recession.

Government data revealed that the UK economy only grew by 0.2 percent from April to June, which was down by 0.5 percent from the same period a year earlier.

Furthermore, economic conditions are not likely to improve.

The OECD expects the UK economy to grow by only by a weak 0.3 percent during the second half of the year.

Italy seems to have gone too far. Its 10-year bonds yields are back over 7%. It is “the beginning of the end” say analysts.

But the end of what?

When the going is good people have little patience for questions. They are too busy, earning and spending, buying and selling, and getting where they are going. But then comes a major turnaround, all of a sudden, and they develop the deep torments of a retarded poet in an unhappy marriage.

‘What really matters?’ they ask themselves. ‘And what the hell am I doing here?’

In the US, the “War Between the States” settled the matter. “We will agree to have a single, centralized state,” said Abraham Lincoln, or words to that effect, “or we will kill you.” Later, the federal income tax, the direct election of senators (which ended individual states’ participation in the federal government), interminable meddling, and numerous Supreme Court decisions further enlarged the power of the central government at the expense of “states’ rights.”

In Europe, several times, centralization was attempted. In his article in The Finan

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The Federal Open Market Committee is still pledging to keep interest rates at exceptionally low levels for an extended period, but focusing in the meantime on removing excess liquidity. Unwinding liquidity programs put into place during the worst of the credit crunch will be a prelude to an eventual interest rate hike — which still appears many months away.

And when rates do rise, it appears we’ll be watching and referring to a different rate. Instead of the federal funds rate — the target rate for what banks pay to borrow from each other overnight — the Fed now has the ability to pay interest on the reserves banks hold at the Fed. This appears to be the new metric the Fed will use to raise interest rates.

Why the switch? A couple of points jump out.

The interest rate paid on Federal Reserve balances is one that will be under the direct control of the FOMC, rather than just setting a target as is the case with the federal funds rate.

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Would you believe that 95% of individual health insurance companies deny people for health insurance based on their gender? This affects women most of all because they are denied coverage at an alarming rate. According to CBS News story “37 states allow health coverage gender bias,” there are only 13 states where it is illegal to practice this ‘gender rating’.
Gender rating is simple, men pay less for health insurance coverage than women do. One of the biggest problems with this, other than the fact that it is unfair, is that women are denied because they go to the doctor more. Interviews with many experts point out though that this actually lowers the overall burden of health care costs nationally. By going to see doctors more regularly, women are treated earlier for diseases and avoid some problems altogether.
Health insurance companies don’t seem to appreciate this though. Read more…

The Supervisor of Banks at the Bank of Israel and the supervisory authorities in the US–signed a Statement of Cooperation. The Statement of Cooperation establishes a mechanism for the transfer of information between the authorities in the context of the authorization process of establishing cross-border banking activity in the U.S. or Israel, and in the context of their ongoing function as regulators of banking activity.

The announcement didn’t specifically mention FBARs, or foreign bank accounts, however, it appears that this will be just one more avenue for the Internal Revenue Service to pursue in locating U.S. citizens who have unreported bank accounts in Israel. According to the press release the Statement of Cooperation establishes a mechanism for the transfer of information between the authorities in the context of the authorization process of establishing cross-border banking activity in the US or Israel, and in the context of their ongoing function as regulators of banking activity.

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The Bank of England’s deliberations during the financial crisis should remain secret, its most senior independent director has insisted, prompting a sharp rebuke from MPs seeking to hold the Bank to account for its actions. Mr Tyrie said he was “disappointed” by the Bank’s position and urged it to rethink the decision. 

Andrew Tyrie, chairman of the Treasury Select Committee, said the “unsatisfactory” decision was hindering Parliamentary scrutiny of the Bank, which is becoming more powerful under planned reforms to the way the City is regulated.

In response, he has published letters from Sir David Lees, chairman of the Bank’s management board, known as the Court,
detailing the Bank’s reasons for withholding the minutes of its meetings.

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