Will helicopter money save us from the coronavirus crisis?

This is Money Podcast

This is Money

Business News, Business, Investing, News

4.1 • 650 Ratings

🗓️ 20 March 2020

⏱️ 60 minutes

🔗️ Recording | iTunes | RSS

🧾️ Download transcript

Summary

Britain has been told to stay at home, pubs have been ordered to shut and you’re not even allowed to go to the gym instead.

The coronavirus crisis has turned the consumer economy upside down. Businesses and workers risk going bust on an almost unprecedented level, unless a rescue plan that works can be cooked up.

Cutting interest rates and quantitative easing was the medicine in the financial crisis, but that’s not working this time round, so is it time to start up the helicopter and drop some money.

Helicopter money, people’s QE and a universal basic income are three of the highly unusual measures suggested, as we go through the back of the financial looking glass.

All involve handing out money directly to people and businesses to combat a global economic crisis triggered by pressing the pause button, but is that wise?

On this week’s podcast, we discuss why rescue attempts so far have failed to stop share prices falling, how Chancellor Rishi Sunak stepped things up with a £350billion bailout plan, and what might happen next, with ideas such as helicopter money, people’s QE and universal basic income.

We also discuss how the interest rate cut to a historic low of 0.1 per cent will affect borrowers and savers, how brave investors can buy in if they are willing to risk some money on a future bounce back, and why supermarkets are unable to keep up with panic buying.

And finally, if the podcast audio isn’t up to the usual standards, please accept our apologies, we are working hard to make sure we can keep recording without access to a studio.

Transcript

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0:00.0	This Is Money's podcast is brought to you in partnership with the financial services compensation
0:03.9	scheme. Check your financial products at FSCP protected at fscs.org.org.com. Welcome to This Is Money. I'm
0:12.5	Georgie Frost and alongside me today is editor Simon Lambert. Well, not technically alongside me
0:19.8	as we enter this brave new world of podcasting in our PJs.
0:24.6	And it's not just Simon and I who've had to leave the office, millions of Brits are now working from home as the government continues to deal with what Boris Johnson has called the worst public health crisis for a generation.
0:36.0	Now, the Chancellor has promised billions to support
0:38.8	the economy from the coronavirus as small businesses are forced to close their doors. The stock
0:44.3	market is still reeling, flights still grounded, supermarkets being raided, schools are out.
0:48.9	So the Bank of England is also, again, taken a side to the base rate of interest, but will it work?
0:54.9	Simon and I dissect another week that was and explain what it means for you and your money.
1:00.7	Don't forget, you set up to date with all the latest breaking money news, just go to this ismoney.com.com.
1:05.6	UK or download the app.
1:08.2	But first, we had the corona budget last week, a 30 billion package to help protect the
1:14.6	economy from the effects of coronavirus.
1:17.7	Even with a base rate cut, it soon became clear, though, that this wouldn't be enough.
1:22.1	Fast forward to now, and the Chancellor has effectively written a blank check.
1:26.3	15% of GDP, or or 350 billion has been promised,
1:30.5	including 330 billion in loans, 20 billion in other aid,
1:34.5	a business rates holiday and grant for retailers and pubs.
1:38.8	Help for airlines also being considered as well as further protection for employees and wages.
1:44.0	So what's in this
1:45.7	350 billion package? Get to some of the finer details. Simon, we will go there first and then
	...

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