The bloody fools are at it again!...

Cressers

More Magic Taxpayers' Money from the amazing rubber cheque book...

http://news.bbc.co.uk/1/hi/uk_politics/7853149.stm

Gavin Gilbert

So your preferred alternative is mass unemployment, personal bankrupcy, repossession and homelessness for the workers?

heftyrider

but what about the thousands of workers that are losing jobs but don;t work for a huge company?

The problem I have with this is that the goverment are throwing money into an industry that is not efficently managed and as such wastes huge amounts of money. These "loans" seem to be without any conditions to improve work/management practices etc.

By bailing the large companies out I know it is sending a message to try and keep confidence in the economy, but surely it's just leaving us all with a big problem for the future whilst only helping out a small number of people in the short term.

As someone who's losing their job but isn't part of a big visible covered by the media company why do my taxes go to help others out when I'm getting no support?

It's a massive economic problem and things need to be done, but subsidising big business who will never repay seems like a crazy solution, it won't make a blind bit of difference to the big picture, just saves some bad PR for the goverment in the media.

Slow Downcp

The problem when it is such a large company/industry is that it does not just affect the workers of that company but also it's supply chain. So by bailing out the large motor manufacturer, they also help keep the small toolmakers, parts suppliers etc going.

I don't necessarily agree with it though

OffTheBackAdam

More gerrymandering.
Jaguar's in a Labour constituency, bet the other ones their bunging money into are too.
They've spent years denouncing car buyers, sticking extra taxes on and are now realising the results.

beverick

:Lets face it all that will happen is that the £2.3bn wil be taken by the foreign multinationals who operate what is laughingly called the UK car industry (which is basically a few guys in half a dozen locations opening bozes of parts shipped in from elsewhere and clipping them together) and the workforce will still be cut.

Bob

Dog Breath

One thing I don't understand; these bank debts didn't just happen in the last 6 months. So, when the banks were previously declaring massive profits, were they in fact falsifying accounts and committing fraud on a grand scale ?

DB

sicrow

Dog Breath wrote:

One thing I don't understand; these bank debts didn't just happen in the last 6 months. So, when the banks were previously declaring massive profits, were they in fact falsifying accounts and committing fraud on a grand scale ?

DB

Briefly DB the loans are/were secured against assets of a market value (i.e your house valued at 250k loaned at 100% which is now worth 200k) which are/were secured assets, now they have looked at these loans which in the media are classed as "toxic" and either written down the security of the assets secured (which will affect the balance sheet and then the P&L account) or have written the loss off totally (i.e not being repaid ever - same secnario)

broadly this is the reason although in reality quite in depth - now we have the government borrowing to get us out of the mess we are in, hence causing the weakening of sterling in general - typical of Labour all through history they have overspent, put nothing away for a "rainy day" and created our history of boom and bust.

Some may disagree but although it's a global crisis we are in a more difficult situation than many because we have nothing to fall back on

For Gavin Gilbert he'll no doubt agree 10 years of total goverment mismanagement and we'll all now suffer for the next 10 at least - maybe more if we keep borrowing and use the IMF later in the year

Now shall I start on the cabinet notes re Iraq

Gavin Gilbert

The current government played the model very well, the problem lays in a latent defect with the model. Everyone knew a recession was coming - I sold my Consultancy 2 years ago and went back to being an employee of A Bigger Fish because it was obvious there was going to be a sharp correction.

What nobody outside banking understood was exactly how screwed up the banks behaviour was. Remember a few years back when we used to get spammed with a hundred emails from US Mortgage Brokers promising approval regardless of circumstances? I used to think it was guff...

The problem comes is that if you run the economic cycle through any of the generally accepted software models the predicted US collapse is nowhere near as drastic as that in real life. But then what the models failed to factor in was the huge increase in energy and commodities prices. Despite the world and his wife knowing that the Chinese economy was overheating and taking the rest of us with it, nobody thought to factor this in. Incredible really.

To blame the recession on Labour is really just a pile of fatuous tosh. Every government in the west has been caught with it's pants down on this one. Some, like Iceland, with their pants down and holding a chicken. There are actually very few nations globally that are better placed than us; the Nordics and Germany. Most of southern Europe is hurting badly as the Euro is overpriced.

And the future? Assuming there are no further shocks to the system, I think another 12 months of real and increasing pain followed by a long haul out of the misery. There will be no return to the consumer credit boom for a generation. But I agree with sicrow - around 2015 we will be in double digit inflation with double digit interest rates. Just like life under John Major

top_bhoy

Gavin Gilbert wrote:

The current government played the model very well, the problem lays in a latent defect with the model. Everyone knew a recession was coming - I sold my Consultancy 2 years ago and went back to being an employee of A Bigger Fish because it was obvious there was going to be a sharp correction.

What nobody outside banking understood was exactly how screwed up the banks behaviour was. Remember a few years back when we used to get spammed with a hundred emails from US Mortgage Brokers promising approval regardless of circumstances? I used to think it was guff...

The problem comes is that if you run the economic cycle through any of the generally accepted software models the predicted US collapse is nowhere near as drastic as that in real life. But then what the models failed to factor in was the huge increase in energy and commodities prices. Despite the world and his wife knowing that the Chinese economy was overheating and taking the rest of us with it, nobody thought to factor this in. Incredible really.

To blame the recession on Labour is really just a pile of fatuous tosh. Every government in the west has been caught with it's pants down on this one. Some, like Iceland, with their pants down and holding a chicken. There are actually very few nations globally that are better placed than us; the Nordics and Germany. Most of southern Europe is hurting badly as the Euro is overpriced.

And the future? Assuming there are no further shocks to the system, I think another 12 months of real and increasing pain followed by a long haul out of the misery. There will be no return to the consumer credit boom for a generation. But I agree with sicrow - around 2015 we will be in double digit inflation with double digit interest rates. Just like life under John Major

What a load of tosh....most sensible people realised there were bigger problems ahead, perhaps they just didn't know when it would explode. You can't have huge house price inflation based on ever increasing Govt/consumer debt levels and outstripping wage inflation without there being a price to be paid. Every developed Western country participated so now they will all pay the price. The Govts could have put the brakes on the debt and leveraging levels of financials but choose to ignore. It was all smoking mirrors to impress the sheepies. The vast majority of Pensions have been royally screwed at the Govts assistance of pension companies skimming of huge profit margins.

Vote in Blair once, fair enough, vote in Blair a second time, understandable, vote in Blair a third time - you deserve all the crap you receive.

Gavin Gilbert

As I said - everyone was expecting a sharp correction. And the problem is global - which you called tosh and then confirmed in your own comments. Don't you bother reading posts before replying?

As for voting for Blair. I did with a sense of joy to get rid of Major, and again to stop Duncan-Smith getting the keys to Number 10, and then with a peg on my nose as the alternative - God Save Us - was Howard.

And given the calibre of the current Tory A Team, my vote will go Labour again.

OffTheBackAdam

I think, no, I know that says more about the spineless bunch of Tony-a-likes than the wonders of Brown's Boys.
The whole lot are useless, can we clone Mrs T? Get ourselves a politician with Cajones?
A Global problem indeed, but enhanced by Brown's policies, his spend & tax, raids on pension funds and stuffing the levels of Goverment full of non-productives on ridiculous salaries & pension schemes.
Luckily we aren't saddled with the Euro too.
The issue of computer models is very interesting, again proving the adage GIGO!

top_bhoy

Gavin Gilbert wrote:

What nobody outside banking understood was exactly how screwed up the banks behaviour was. Remember a few years back when we used to get spammed with a hundred emails from US Mortgage Brokers promising approval regardless of circumstances? I used to think it was guff...

To blame the recession on Labour is really just a pile of fatuous tosh. Every government in the west has been caught with it's pants down on this one. Some, like Iceland, with their pants down and holding a chicken. There are actually very few nations globally that are better placed than us; the Nordics and Germany. Most of southern Europe is hurting badly as the Euro is overpriced.

You send out mixed signals. The downturn was either expected or Govts were 'caught with their pants down', which is it?

You may have thought it was guff but when people up and down the country in dead end jobs were running about in expensive cars and house prices reaching the levels they did along with record high personal debt levels, - it wasn't hard for the sensible people to realise the credit supply was screwed. You obviously never stopped to think this through a few years ago, believing Browns 'No more boom and Bust' mantra and/or led a 'fairly sheltered life/uninterested' not to know what was occurring in the UK over the last 10 years.

With the unemployed getting Lo-doc mortgages without even basic financial checks, it could only ever end in tears. The whole approval system is corrupt and little wonder the financials collapsed and house price inflation grossly outstripped wage inflation - it was made easy to make illegal income declarations if you had the balls to do it.

1footedninja

http://video.google.com/videoplay?docid ... 7695921912

Offers an alternative world shared view to everything that is going on around you on 'our' planet right now, the beginning of the movie for about the first 1/4 offers an insight into the monetary system as viewed from the American dollar.

Gavin Gilbert

OffTheBackAdam wrote:

can we clone Mrs T?

I was under the impression his name was Tony Blair

OffTheBackAdam wrote:

Get ourselves a politician with Cajones?

Wot, like this?



I understand he was very popular with the disgruntled Telegraph and Mail types the last time we were in this much trouble...

Gavin Gilbert

Top_Bhoy wrote:

You send out mixed signals. The downturn was either expected or Govts were 'caught with their pants down', which is it?

Read it - carefully - again and explain where the contradiction is. The downturn was predicted. The chaos in the banking sector wasn't. Not until late last year when it was too late.

It was pretty bloody evident in the UK at least that the stupid rises in house prices was going to end in tears. We'd seen it before in very recent memory and only the most optimistic fool thought otherwise ('lo I personally know plenty of optimistic fools). Same as for those saddling themselves with thousands in credit card debts.

A wake up call was due. It's here, so live with it.

To be frank I don't understand your position. Do you really expect people to vote for a government that promises gruel and long hours, however good for them it may be, or for a government that trys to improve peoples lives?

Do you see the UK as a leading player, or a trading nation located off the east coast of the USA that's managed to cling onto G8 status by acting as an off-shore annex of Wall Street. Do you think it totally unreasonable for the UK not to carry on business-as-normal when our major trading partner goes tits up?

Do you not understand that the entire world economic system is based on surfing a wave created by the US, and laterly - China?

top_bhoy

Gavin Gilbert wrote:

Top_Bhoy wrote:

You send out mixed signals. The downturn was either expected or Govts were 'caught with their pants down', which is it?

Read it - carefully - again and explain where the contradiction is. The downturn was predicted. The chaos in the banking sector wasn't. Not until late last year when it was too late.

Downturn was predicted?? Your beloved Brown said "No more boom and bust" and was in charge for over a decade so he obviously didn't expect a downturn - until it was too late. Like King Canute who tried to hold back the tide and then found he couldn't.

From Browns 2007 budget speech - hardly sounds like a man expecting a downturn!! In 2008, it was already happening.

I can report the British economy is today growing faster than all the other G7 economies - growth stronger this year than the euro area, stronger than Japan and stronger even than America.

And that after 10 years of sustained growth, Britain's growth will continue into its 59th quarter - the forecast end of the cycle - and then into its 60th and 61st quarter and beyond.

Mr Deputy Speaker, before 1997 we were bottom in the G7 for national income per head - seventh out of seven, behind Germany, Italy, France, Canada and Japan. Now we are second only to America and ahead of all these countries.

Every country has faced a trebling of oil and commodity prices. But while inflation peaked at 4.7 per cent in America and went as high as 3.3 per cent in the G7, here in Britain, inflation has never gone beyond 3 per cent, has fallen from 3 per cent to 2.8 per cent, and will fall further this year to 2 per cent.

Our forecast and the consensus of independent forecasts agree that looking ahead to 2008 and 2009 inflation will also be on target.

I've already suggested that people who were never ever in a position to get a mortgage or credit previously suddenly found that they could...people could overnight get mortgages, easy credit card debt, car finance, etc...Add in the toxic instruments, which were all known about, of 'CDSs and RMBS', financial chaos and painful days were just around the corner - Brown was the financial guru who oversaw all of this.

Would the Tories have done better (I doubt if they could have done much worse) - given their history with de-regulation that is unlikely but that doesn't mean that Brown and Blairs lies and financial incompetence should have gone on being rewarded - hence, those who voted at the last election for the duo have to take the medicine which they asked for. Too late to complain.

I can't see why you feel the need to defend Browns incompetence and that of a crooked Labour party, with their snouts in the trough as much as any previous Tory party ever was.

nwallace

Top_Bhoy wrote:

Downturn was predicted?? Your beloved Brown said "No more boom and bust" and was in charge for over a decade so he obviously didn't expect a downturn - until it was too late. Like King Canute who tried to hold back the tide and then found he couldn't.

Brown may not have, or denied it, but many others were predicting it.

http://www.epolitix.com/interviews/inte ... okesman-1/

Gavin Gilbert

FFS! Is there some problem with the 'strine education system where you aren't taught to think your point through? Try again!!!

And no politican is going to talk the economy down, unless his name is George 'Rabbit in the Headlights' Osbourn

top_bhoy

I have thought the problem through many years ago but the problem is that there are people around who simply aren't capable of separating the labour spin and what actually had and is happening. The crisis just didn't happen overnight - Labour simply ignored good financial regulation to sustain the unsustainable, 'smoke and mirrors' economy. Like it or not - that is what happened.

That the US screwed up is no excuse, the UK didn't have to follow and only has itself to blame.

Justpush

Some people think that that global capitalism l is built upon the premise that infinite economic expansion is possible in a world of limited resources and everything will be alright.
Guess what is going to happen.

How many people act like a herd instinct?
FFS wake up.

OffTheBackAdam

The Germans have got a much better idea. They're offering people money (2,000 Euros) if they part exchange a car over 9 years old for a new one.
Gives the car makers & vendors revenue, stimulates the economy & removes less-fuel efficient vehicles from the road.

Gavin Gilbert

OffTheBackAdam wrote:

The Germans have got a much better idea. They're offering people money (2,000 Euros) if they part exchange a car over 9 years old for a new one.
Gives the car makers & vendors revenue, stimulates the economy & removes less-fuel efficient vehicles from the road.

Aye. and making Corporatist no-redundancy deals with the Companines and Unions. How utterly unlike 1932 the world is becoming :?

teagar

Dog Breath wrote:

One thing I don't understand; these bank debts didn't just happen in the last 6 months. So, when the banks were previously declaring massive profits, were they in fact falsifying accounts and committing fraud on a grand scale ?

DB

That's not how it works I'm afraid.

The root I think lies in the notion of securities.

In short, banks, of all types (investment or high street), can buy mortages off other banks. They pay the money upfront to the bank who gave out the loan, on the basis that they get the longer term repayment money from that loan.

So effectively a bank can lend out to virtually anyone and then sell it on.

This was considered as a situation that reduced risk. Unfortunately, it didn't really work, since banks would hand out loans to people they wouldn’t have previously (i.e. sub-prime) on the grounds that they can make the instant profit by selling it on to someone else.

The big investment banks (particularly Lehman's), took these securities and did some crazy maths with them, which they thought reduced the risk further, but merely hid it.

Naturally with cheap loans comes a housing bubble, since those who couldn't afford houses (sub-prime people) can now buy houses, so demand shoots up.

Eventually when enough people begin to default on their loans, those who own the securities suddenly realise they've spent all this money and won't get any back. They then recall all their loans and a chain reaction occurs.

This was often made worse since many firms leveraged themselves to buy even more securities (basically borrowing money to buy securities). That basically means the gains you get are really amplified, but so are the losses you incur if they don't work out.

That's how they posted record gains and then lost it all.

The profits they've made were artificially boosted by a general lack of understanding of the market by all those involved.


OffTheBackAdam - Clearly you have something against labour, but I don't really understand how Brown is in anyway responsible for this?

The global financial market is totally rooted in the US, which is why the US housing collapse hurt everyone.

Britain is loosing out rather more than others simply because of the nature of its economy - primarily service based - particularly financial. Clearly finance is toxic so everyone wants to leave that well alone. Furthermore, the highly skilled services provided are often the first to go during recessions - it is the nature of services. Not much Brown can do about that.

Mickey Mouse complaints about specific tax policies here and there make no difference in the long run.

(I haven’t read all the posts...), If you are a supporter of Cameron or the Tories in general, could you please explain the frankly logic defying proposal to "save" our way out of recession? That's what a recession is! People saving instead of buying!