Ruffer pair warn on dangers of 'radical' policy measures

QE was once considered 'reckless'

Managers of the Ruffer Investment Company, Steve Russell and Hamish Baillie, have warned of the dangers of using more "radical" policy measures, such as negative interest rates already employed by several central banks, as they worry the use of such extreme tools to stimulate growth is becoming the norm.

The pair said quantitative easing was once considered a "radical" response to the global financial crisis, but now asset purchasing is regularly used by central banks. "Since 2008m we have seen a continual creep in the radical becoming mainstream. Quantitative easing, once considered reckless, is now a primary policy tool," the pair said. "Zero interest rates were implausible, but now negative rates are becoming widespread. This drift into increasingly radical areas of monetary policy, while necessary as an antidote to the high-debt/low-growth hangover of the financial crisis, comes w...