What effect has quantitative easing had on pension deficits of large UK companies? A recent study has suggested that the final-salary pension shortfall of the top 350 companies in the UK has quadrupled over the past year from £20 billion to £80 billion. The authors of the report suggest that this increase is largely due to falling gilt yields, arising from the fact that the Bank of England has bought a third of the gilt market through quantitative easing. But this report ignores the impact of quantitative easing on equities and other real assets held by pension funds. As highlighted in an earlier post, quantitative easing may have helped sustain returns on real assets.
The Berkeley Earth Project , an independent study of global warming, has found that the earth has become a degree warmer over the past half century. However, the statistical uncertainty surrounding pre-1920 estimates makes it very hard to say much about long-term trends - click here for graph . This is one of my concerns with the global warming debate - we simply don't have trustworthy long-run data which looks at temperature changes over the last millennium (or two). My second concern with the global warming debate is that it is very hard to prove any sort of casual link between global warming and human activity. The scientists may be able to show correlation between global warming and our production of carbon dioxides etc., but correlation is not causation. My third concern with the debate is that those who are sceptical or agnostic are stereotyped as flat-earthers or intellectually-challenged crackpots. This only stifles debate and the progress of science itself.