Wealth creators

secretsqizz

Not individuals as such, even tho important but sectors that create wealth and GDP for the country.
Where/what is the next 'big thing' for the UK.
Or is it up to TESCO to employ the lot of us?
But where does the money spent in said TESCO come from?

Cressers

The 'Next Big Thing' is surveillance and control technology.

rick_chasey

secretsqizz wrote:

Not individuals as such, even tho important but sectors that create wealth and GDP for the country.
Where/what is the next 'big thing' for the UK.
Or is it up to TESCO to employ the lot of us?
But where does the money spent in said TESCO come from?

Anyone who does anything and gets paid for it is a 'wealth creator'.

Ben6899

What Rick said.

secretsqizz

Even a Greek public sector employee?
We're all safe then.

rick_chasey

secretsqizz wrote:

Even a Greek public sector employee?
We're all safe then.

Should talk to Cressers about that.

He'll calm your nerves.

secretsqizz

It is just that if the Uk had that lottery win of North Sea oil all over again, what would it do with all the loverly revenue?

I agree with the optimism, summat will turn up
won't it

rick_chasey

secretsqizz wrote:

It is just that if the Uk had that lottery win of North Sea oil all over again, what would it do with all the loverly revenue?

I agree with the optimism, summat will turn up
won't it

People doing stuff creates wealth.

Money is just a way of measuring what that effort is worth.

Oil doesn't make money. People drilling, processing, and selling oil makes money.

passout

Tourism - especially inbound Tourism with a weak pound. Fresh money into the economy, infastructure already in place and so on. Already significant (about 4% of GDP for all tourism including domestic) but with more centralized marketing of cultural tourism to other countries it could be much bigger. The biggest potential market for these incoming tourists: Brazil, Mexico, China, India etc. American and European markets are already at stagnation but need to be maintained.

Other areas could include technology at the highest level, linked to research / Universities eg nano-technology.

Pross

I think the UK will continue to do well in the pharmaceutical industry and small scale high-end engineering where it currently excels and is also at the forefront of the computer games industry which is apparently worth more than the music or film industries. We have to be realistic though and the days of large scale heavy industry are over as we just can't compete with the likes of China on cost. If they expand to the point where their own labour costs become high then it will be some other developing country that will take their place.

EKIMIKE

Unfotunately for us, manufacturing industries are the best source of wealth creation. Nothing else comes close in terms of taking a resource and adding value.

Unfortunately this became un-fashionable in the UK and we're suffering as a result. This country really needs to strike gold on something that involves manufacturing goods for the global market. The real acid test is if/when that happens, will they have to common sense to keep the manufacturing processes in the UK. It might be cheap to employ 1000 Asians in the short term but the British economy will suffer in the long term. It's obvious to see that the places we've shifted our industry to are now the major wealth creators in this world.

So if Tourism and selling technological knowledge are our best prospects for wealth creation then the future is dark. They might be glitzy and fashionable but so was investment banking and look where that got us. If on the other hand we begin to turn our technological knowledge into manufacturing then we'll do alright.

The thing that pisses me off is the idiots that ridicule 'Shitty Taiwanese/Chinese Bikes' because when it comes to it, they're the clever ones, they're making the money. The idiots that ridicule the Chinese/Taiwanese are the sort of pricks that sold out this countries industries for Offices and Shops. That's why young people like me can't get a job.

Frank the tank

If/when this country can no longer mine,process,manufacture or farm anything, which at the rate we're going won't be to long, we will be totally fupped.

Harking back to the "implication" of the OP. IHMO service industries don't create wealth as such, you have to create/make something tangible to do that. I.E. you have to add value. I'm affraid we're all at the mercy of the free market at the mo.

EKMIKE, I work for Rolls Royce and they're happy to "off-load" work to any part of the world if a company SAYS it can do it cheaper. Unfortunately for the likes of myself my job will be sold down the river and I know these other companies cannot in some cases actually produce the job at all let alone cheaper. It's absolute folly but hey-ho I and a lot of my colleagues will shortly find ourselves on the shit heap. Then politicians wonder why there are no apprenticeships or quality jobs. My advice to you as a young man is avoid manufacturing engineering like the plague; unless you want to be contantly tooking over your shoulder for where the next threat to your employment is coming from and froever fighting attacks on your T&Cs.

rake

Rick Chasey wrote:

secretsqizz wrote:

Not individuals as such, even tho important but sectors that create wealth and GDP for the country.
Where/what is the next 'big thing' for the UK.
Or is it up to TESCO to employ the lot of us?
But where does the money spent in said TESCO come from?

Anyone who does anything and gets paid for it is a 'wealth creator'.

not true in my opinion there are middle men and processors as well. i think the op is trying to ask what is driving britain and where does the money keep coming from with our service only economy. quantative easing doesnt count. neither does selling off the gold reserves.

rake

EKIMIKE wrote:

Unfotunately for us, manufacturing industries are the best source of wealth creation. Nothing else comes close in terms of taking a resource and adding value.

Unfortunately this became un-fashionable in the UK and we're suffering as a result. This country really needs to strike gold on something that involves manufacturing goods for the global market. The real acid test is if/when that happens, will they have to common sense to keep the manufacturing processes in the UK. It might be cheap to employ 1000 Asians in the short term but the British economy will suffer in the long term. It's obvious to see that the places we've shifted our industry to are now the major wealth creators in this world.

So if Tourism and selling technological knowledge are our best prospects for wealth creation then the future is dark. They might be glitzy and fashionable but so was investment banking and look where that got us. If on the other hand we begin to turn our technological knowledge into manufacturing then we'll do alright.

The thing that pisses me off is the idiots that ridicule 'Shitty Taiwanese/Chinese Bikes' because when it comes to it, they're the clever ones, they're making the money. The idiots that ridicule the Chinese/Taiwanese are the sort of pricks that sold out this countries industries for Offices and Shops. That's why young people like me can't get a job.

+100000000000000. do people not look at history and see what created the developed countries, it wasnt 'IT' or investment banking or telesales. it was hardcore manufacturing and engineering, raw materials. were now fupped in that respect.

rick_chasey

rake wrote:

Rick Chasey wrote:

secretsqizz wrote:

Not individuals as such, even tho important but sectors that create wealth and GDP for the country.
Where/what is the next 'big thing' for the UK.
Or is it up to TESCO to employ the lot of us?
But where does the money spent in said TESCO come from?

Anyone who does anything and gets paid for it is a 'wealth creator'.

not true in my opinion there are middle men and processors as well. i think the op is trying to ask what is driving britain and where does the money keep coming from with our service only economy. quantative easing doesnt count. neither does selling off the gold reserves.

Like I said, labour?

Tertiary sector work generates wealth because they provide services for which people, or companies pay for. Like getting your hair cut. Nothing is 'created' as such, but it's a service which adds value, since society demands hair to be cut by people who are trained to do so.

I've never really understood the obsession with making stuff in house. Sell your services, get paid, and buy stuff. Not all economies globally are tertiary sector based, so what's the problem?

Just because it's intangible doesn't mean it's worth less than something that isn't.

BikingBernie

Whoever generates the wealth (ultimately those who create the products that everyone needs to live, irrespective of where the manufacturing and production is actually done) the thieving bastards in the financial sector will continue to skim off a significant percentage of the 'real' economy at every turn in order to line their own pockets. Just look at what happens every time you convert some currency, let alone the glorified gambling that occurs on the stock, commodity and financial markets.

Of course most everyone was happy with this arrangement when the economies being raped were 'foreign', the financiers were British and therefore it looked as though the set up benefited Britain's economy...

rake

Rick Chasey wrote:

rake wrote:

Rick Chasey wrote:

secretsqizz wrote:

Not individuals as such, even tho important but sectors that create wealth and GDP for the country.
Where/what is the next 'big thing' for the UK.
Or is it up to TESCO to employ the lot of us?
But where does the money spent in said TESCO come from?

Anyone who does anything and gets paid for it is a 'wealth creator'.

not true in my opinion there are middle men and processors as well. i think the op is trying to ask what is driving britain and where does the money keep coming from with our service only economy. quantative easing doesnt count. neither does selling off the gold reserves.

Like I said, labour?

Tertiary sector work generates wealth because they provide services for which people, or companies pay for. Like getting your hair cut. Nothing is 'created' as such, but it's a service which adds value, since society demands hair to be cut by people who are trained to do so.

I've never really understood the obsession with making stuff in house. Sell your services, get paid, and buy stuff. Not all economies globally are tertiary sector based, so what's the problem?

Just because it's intangible doesn't mean it's worth less than something that isn't.

im not saying intangilbe things are worth less. you say sell your stuff get paid and BUY stuff. when you buy the stuff your pay is going out of our economy so isnt being paid to someone else here who in return cant buy any stuff, so the cycle is broken. i presume you have a car for example that isnt british. its not an absolute argument (or obsession), we need all kinds of activity, but its a numbers thing to keep most of us employed, its as rediculous to say we dont need this particular area at all. were playing with only two darts.

craker

I think it was JM Keynes who advocated employing people to dig holes and employing more people to fill the holes in. That was during the depression, and the point was to get more money circulating the economy.

I can't see that being a long term strategy though. Anyone who suggests that the economy will run and run on the basis of unproductive economic activity is going to end up in a Britain with lots of holes being dug then filled in.

Service industries do help with wealth creation - I couldn't do my IT job in an unclean environment with no health service and no education etc etc (or if I could I would be less productive).

BikingBernie

rake wrote:

im not saying intangilbe things are worth less. you say sell your stuff get paid and BUY stuff. when you buy the stuff your pay is going out of our economy so isnt being paid to someone else here who in return cant buy any stuff, so the cycle is broken.

But as long as that process allows those who own and 'financially service' industry to make more profits for themselves, all is well and good. If mass unemployment and the creation of an 'underclass' is a side effect, again all to the good as this keeps down wages, makes employees more concerned about keeping their jobs than fighting for better conditions and so on. Ensure that the cost of keeping the unemployed underclass alive and in control is kept to a minimum ( aided by a few 'dole scrounger' stories in The Daily Mail every other week) and the way is clear for the elite to continue to rake it in which, after all, is the whole purpose of the current economic system.

rick_chasey

rake wrote:

Rick Chasey wrote:

rake wrote:

Rick Chasey wrote:

secretsqizz wrote:

Not individuals as such, even tho important but sectors that create wealth and GDP for the country.
Where/what is the next 'big thing' for the UK.
Or is it up to TESCO to employ the lot of us?
But where does the money spent in said TESCO come from?

Anyone who does anything and gets paid for it is a 'wealth creator'.

not true in my opinion there are middle men and processors as well. i think the op is trying to ask what is driving britain and where does the money keep coming from with our service only economy. quantative easing doesnt count. neither does selling off the gold reserves.

Like I said, labour?

Tertiary sector work generates wealth because they provide services for which people, or companies pay for. Like getting your hair cut. Nothing is 'created' as such, but it's a service which adds value, since society demands hair to be cut by people who are trained to do so.

I've never really understood the obsession with making stuff in house. Sell your services, get paid, and buy stuff. Not all economies globally are tertiary sector based, so what's the problem?

Just because it's intangible doesn't mean it's worth less than something that isn't.

im not saying intangilbe things are worth less. you say sell your stuff get paid and BUY stuff. when you buy the stuff your pay is going out of our economy so isnt being paid to someone else here who in return cant buy any stuff, so the cycle is broken. i presume you have a car for example that isnt british. its not an absolute argument (or obsession), we need all kinds of activity, but its a numbers thing to keep most of us employed, its as rediculous to say we dont need this particular area at all. :arrow:

There isn't a fixed amount of wealth in the world, that gets shuffled around from country to country. As the title suggests, wealth is 'created'. As long as you keep on creating wealth, it's all good.

Anyway, services, especially high added value services, are very easy to export, and are are often exported, so that argument doesn't fly either.

I'm not saying manufacturing isn't needed in the UK, but I am saying that people get unecessarily hung up on manufacturing because its produce is tangible, and thus easier to visualise, and that high value services are rarely used by individuals, so are 'hidden' from the public view.

How much value is a company adding when they improve another company's efficiency by 2%? That knowledge transfer is certainly worth something, and it thus adds value.

rake

BikingBernie wrote:

rake wrote:

im not saying intangilbe things are worth less. you say sell your stuff get paid and BUY stuff. when you buy the stuff your pay is going out of our economy so isnt being paid to someone else here who in return cant buy any stuff, so the cycle is broken.

But as long as that process allows those who own and 'financially service' industry to make more profits for themselves, all is well and good. If mass unemployment and the creation of an 'underclass' is a side effect, again all to the good as this keeps down wages, makes employees more concerned about keeping their jobs than fighting for better conditions and so on. Ensure that the cost of keeping the unemployed underclass alive and in control is kept to a minimum ( aided by a few 'dole scrounger' stories in The Daily Mail every other week) and the way is clear for the elite to continue to rake it in which, after all, is the whole purpose of the current economic system.

creating the myth of a skills shortage and not investing anything in training also helps keep people in their place and transferes the blame of a failed system that cant employ enough people onto the scroungers shoulders.

BikingBernie

It could also be argued that much of the 'wealth' creation' problem is actually one of 'wealth distribution', stemming from the fact that Britian is in many respects still a feudal system. For example, 70% of all the land in Britain is owned by just 0.6% of the population. As Lennon sang:

Keep you doped with religion and sex and TV,
And you think you're so clever and classless and free,
But you're still fucking peasants as far as I can see,

guinea

Two quick points.

1. The UK is the 6th biggest manufacturer in the world. To say we don't make anything is lies. Stop it.

2. Wealth is only created through more debt. When you make something more money is not just magiced into existance. When you borrow money, it is.

rake

Rick Chasey wrote:

rake wrote:

Rick Chasey wrote:

rake wrote:

Rick Chasey wrote:

secretsqizz wrote:

Not individuals as such, even tho important but sectors that create wealth and GDP for the country.
Where/what is the next 'big thing' for the UK.
Or is it up to TESCO to employ the lot of us?
But where does the money spent in said TESCO come from?

Anyone who does anything and gets paid for it is a 'wealth creator'.

not true in my opinion there are middle men and processors as well. i think the op is trying to ask what is driving britain and where does the money keep coming from with our service only economy. quantative easing doesnt count. neither does selling off the gold reserves.

Like I said, labour?

Tertiary sector work generates wealth because they provide services for which people, or companies pay for. Like getting your hair cut. Nothing is 'created' as such, but it's a service which adds value, since society demands hair to be cut by people who are trained to do so.

I've never really understood the obsession with making stuff in house. Sell your services, get paid, and buy stuff. Not all economies globally are tertiary sector based, so what's the problem?

Just because it's intangible doesn't mean it's worth less than something that isn't.

im not saying intangilbe things are worth less. you say sell your stuff get paid and BUY stuff. when you buy the stuff your pay is going out of our economy so isnt being paid to someone else here who in return cant buy any stuff, so the cycle is broken. i presume you have a car for example that isnt british. its not an absolute argument (or obsession), we need all kinds of activity, but its a numbers thing to keep most of us employed, its as rediculous to say we dont need this particular area at all. :arrow:

There isn't a fixed amount of wealth in the world, that gets shuffled around from country to country. As the title suggests, wealth is 'created'. As long as you keep on creating wealth, it's all good.

Anyway, services, especially high added value services, are very easy to export, and are are often exported, so that argument doesn't fly either.

I'm not saying manufacturing isn't needed in the UK, but I am saying that people get unecessarily hung up on manufacturing because its produce is tangible, and thus easier to visualise, and that high value services are rarely used by individuals, so are 'hidden' from the public view.

How much value is a company adding when they improve another company's efficiency by 2%? That knowledge transfer is certainly worth something, and it thus adds value.

im not disputing that there are other ways to pass money around in a puposefull way. im not 'hung up' simply because its easier to visualise and its the only thing i can grasp, the reason such as I focus on this sector is because its the only one under such sustained attack to eliminate it. you cant play darts with only two darts and achieve a respectable score. each dart is as important as the next.

TheYorkshireMan

BikingBernie wrote:

It could also be argued that much of the 'wealth' creation' problem is actually one of 'wealth distribution', stemming from the fact that Britian is in many respects still a fuedal system. For example, 70% of all the land in Britain is owned by just 0.6% of the population. As Lennon sang:

Keep you doped with religion and sex and TV,
And you think you're so clever and classless and free,
But you're still fucking peasants as far as I can see,

Or as Dick Gaughan sang.

Come all of you workers who toil night and day
By hand and by brain to earn your pay
Who for centuries long past for no more than your bread
Have bled for your countries and counted your dead

In the factories and mills, in the shipyards and mines
We've often been told to keep up with the times
For our skills are not needed, they've streamlined the job
And with sliderule and stopwatch our pride they have robbed

Chorus.
We're the first ones to starve, we're the first ones to die
The first ones in line for that pie-in-the-sky
And we're always the last when the cream is shared out
For the worker is working when the fat cat's about

And when the sky darkens and the prospect is war
Who's given a gun and then pushed to the fore
And expected to die for the land of our birth
Though we've never owned one handful of earth?

All of these things the worker has done
From tilling the fields to carrying the gun
We've been yoked to the plough since time first began
And always expected to carry the can


http://www.youtube.com/watch?v=nrdl4ijru8o

Another version -

http://www.youtube.com/watch?v=aTafZRecy2k

secretsqizz

We have lost out in making stuff to the Far East and Germany who are still hanging in there?
So, a services economy is the way forward for the UK?

It is and will be more and more a mass employer and exporter to suck in money from overseas to maintain our 'still' mainly comfortable way of life?

Just trying to make sense of it all.
Someone said it was a fairly important day.....

rake

TheYorkshireMan wrote:

BikingBernie wrote:

It could also be argued that much of the 'wealth' creation' problem is actually one of 'wealth distribution', stemming from the fact that Britian is in many respects still a fuedal system. For example, 70% of all the land in Britain is owned by just 0.6% of the population. As Lennon sang:

Keep you doped with religion and sex and TV,
And you think you're so clever and classless and free,
But you're still fucking peasants as far as I can see,

Or as Dick Gaughan sang.

Come all of you workers who toil night and day
By hand and by brain to earn your pay
Who for centuries long past for no more than your bread
Have bled for your countries and counted your dead

In the factories and mills, in the shipyards and mines
We've often been told to keep up with the times
For our skills are not needed, they've streamlined the job
And with sliderule and stopwatch our pride they have robbed

Chorus.
We're the first ones to starve, we're the first ones to die
The first ones in line for that pie-in-the-sky
And we're always the last when the cream is shared out
For the worker is working when the fat cat's about

And when the sky darkens and the prospect is war
Who's given a gun and then pushed to the fore
And expected to die for the land of our birth
Though we've never owned one handful of earth?

All of these things the worker has done
From tilling the fields to carrying the gun
We've been yoked to the plough since time first began
And always expected to carry the can


http://www.youtube.com/watch?v=nrdl4ijru8o

Another version -

http://www.youtube.com/watch?v=aTafZRecy2k

thanks for that link. it did my heart good.

EKIMIKE

guinea wrote:

Two quick points.

1. The UK is the 6th biggest manufacturer in the world. To say we don't make anything is lies. Stop it.

Statistically, yes. Look closer and you see that much of our manufacturing industry is a leak on our economy. A great example is the Car manufacturing industry in this country. Toyota, Honda, Nissan, Land Rover, Jaguar, Aston Martin - all foreign owned companies/brands. They might employ some British workers but the vast majority of the profits go elsehwere. It's also worth noting that the Japanese manufacturers were lured here by favourable financial terms. Grants, cheap land e.t.c.

This is a big issue. We saw it in the recession that when times are hard, the Japanese shut down the factories in the UK not Japan. We suffered big time for it. But you can't blame them can you. They're not gonna spit in their own soup are they.

Also our manufacturing work force has a heavy foreign contingent. I live in Wiltshire where many Eastern European (particularly Polish) people have settled. They make up the majority of the workforce in local factories. (just to make it clear i have no issue with them coming here and them as people 'cos it's the governments job to control immigration/jobs not them and they're EU citizens). This is also a leak in the economy as they often send money back or leave after a period of time to return to their home country.

guinea wrote:

2. Wealth is only created through more debt. When you make something more money is not just magiced into existance. When you borrow money, it is.

Just because the UK did that in the last 15 years doesn't mean that's how everyone does it . The best and most efficient form of wealth creation is manufacturing. This is proven. Take a look at the steel industry and Lakshmi Mittal in particular. Steel became un-fashionable - a dirty un-glamorous industry. Yet he bought up all the unwanted assets and now reigns as one of the worlds richest men.

nolf

The whole line of questioning is socialist.

It presupposes that "Someone" controls whats made in the economy, and that "Someone" should choose something else to do.

Thats rubbish. We have a free, individualistic, capitalist, market economy, with individual economic agents who allocate resources wherever they want (I shop in Tescos because I choose to...).

When you do a business start up you don't ask, "what does 'someone/the economy' wantme to do?", but "What will make me money?".
It's the ultimate pragmatism, and not driven by theory, but what is an efficient and productive allocation of resources. So whether its industry or hair cuts, who cares? They both create wealth.

In a free market wealth and resources get allocated to those who use them efficiently. If you can come up with something that people will buy, you get paid for it. Statistics that illustrate the majority of GDP is rooted in Services (approx. 75% GDP), are merely an illustration that we seem to be good at that.

The problem with any debate discussing the future of the economy, and trying to decide that future, is an arrogant assumption that the state has the right to dictate the decisions of economic agents (everyone from ordinary shoppers, to those on the doll, to investment bankers). To take away that inherent and important freedom to choose what we do with our wealth, or what our companies make/sell, destroys the basis of our modern liberal democracy.
I think it is both morally (and clearly economically) wrong to prevent individuals acting in the way that they feel is right.

When you have free economic agents, they determine what gets made/created, by choosing with their wallets. In a way the free market is the ultimate democracy in action, in that which industries/sectors of the economy will prosper is determined by YOU, whenever you buy anything.

Economics is merely an attempt to determine/estimate the way in which the majority of these free economic agents will act, and its effect on the economic structure as a whole. The future of the economy is determined by economic agents (consumers/businesses) not economists or government departments.

So to answer the original question, what do I think will be the principal wealth creators?
I would guess we will move even more towards a knowlege economy, using this as the basis for the services we provide. But if that turns out to be innefficient, free economic agents will move the capital and resources to where it turns out to be most profitable.

nolf

Also don't confuse money with wealth. They're not interchangeable terms!

nolf

rake wrote:

Rick Chasey wrote:

rake wrote:

Rick Chasey wrote:

secretsqizz wrote:

Not individuals as such, even tho important but sectors that create wealth and GDP for the country.
Where/what is the next 'big thing' for the UK.
Or is it up to TESCO to employ the lot of us?
But where does the money spent in said TESCO come from?

Anyone who does anything and gets paid for it is a 'wealth creator'.

not true in my opinion there are middle men and processors as well. i think the op is trying to ask what is driving britain and where does the money keep coming from with our service only economy. quantative easing doesnt count. neither does selling off the gold reserves.

Like I said, labour?

Tertiary sector work generates wealth because they provide services for which people, or companies pay for. Like getting your hair cut. Nothing is 'created' as such, but it's a service which adds value, since society demands hair to be cut by people who are trained to do so.

I've never really understood the obsession with making stuff in house. Sell your services, get paid, and buy stuff. Not all economies globally are tertiary sector based, so what's the problem?

Just because it's intangible doesn't mean it's worth less than something that isn't.

im not saying intangilbe things are worth less. you say sell your stuff get paid and BUY stuff. when you buy the stuff your pay is going out of our economy so isnt being paid to someone else here who in return cant buy any stuff, so the cycle is broken. i presume you have a car for example that isnt british. its not an absolute argument (or obsession), we need all kinds of activity, but its a numbers thing to keep most of us employed, its as rediculous to say we dont need this particular area at all. were playing with only two darts.

Buying stuff is putting money back into the economy. Savings aretechnically a withdrawal from the economy.

Imports are a withdrawal of cash from the economy.
However we still have inflation. This indicates that we are still creating a lot of new wealth. indeed it has been noted for many years that inflation is a useful way of exporting inflation to other countries, so we don't get it here.