Quack! Quack!

Our sleuths have discovered that the hacking scandal has extended to eavesdropping on private conversations between doctors and patients. We have been passed the transcript of one conversation from a surgery somewhere in the Whitehall area.

Doc: Well, Mr Washborn, what seems to be the trouble? You seem to be in some pain.
I have severe inflation and I’ve got difficulty with my liquidity.
In arrears?
Yes.
Any side affects?
My purchasing power is not what it used to be and my spending limit feels frozen.
Anything else?
My interest rate is almost zero and everything seems out of focus.
Have you been overdoing it in the shops? Or expending too much on your welfare? Wasting money on expensive IT gadgets that don’t work when you get them home? Paying too much interest in interest?
I get terrible fits of recession …
Double dip?
I’m not sure.
OK, the good news is that you are not alone. It’s an infection – a new strain of good old-fashioned Debt Crisis, or Credito scrunchy horribilis as we doctors like to call it. It’s rampant throughout Europe and North America. So you are in good company!
What’s the cure?
What you need is an austerity package. You will have to increase your tax and cut back on both essentials and luxuries. Roll up your sleeve and I’ll take a credit rating. This may hurt your pride.
Well, is it normal?
We don’t set much store by credit ratings these days, but yours is normal. Yes, its junk.
Junk! What are you talking about?
Well, it looks to me as if your Debt Crisis is so severe that it is extremely unlikely you will ever be in credit again. And junk is better than default, after all!
So what am I to do? I can’t go on like this, putting on the weight of taxation and living on borrowed money. The bank is threatening to repossess everything I thought I owned. Oh my mortgage!
I see from your notes that you have suffered from Debt Crisis before. What did I prescribe last time?
Eh, something beginning with the letter Q, if I recall.
Ah, you mean Quantitative Easing! Yes, well it didn’t work last time so all I can suggest is that we try something a little stronger. Its called QE2.
But it didn’t do any good before!
Well, that is one way of looking at it. Let’s give it a try for a couple of months and see how you get on. If you find its not working or you become contagious, I recommend you cross your fingers and hope the infection will go away. Something is bound to turn upside down sooner or later – even if it is the total collapse of the monetary system!
Thank you doctor, you’ve been a great help.