Greg, now can we get rid of Osborne please?

Paul E

Could always blame the previous Gov for overspending and borrwing way too much to make themselves look like they were doing the country some good when in fact they dug us into a huge hole and they knew it too by leaving notes saying no money left

rick_chasey

Stag on wrote:

This may be of interest

http://www.telegraph.co.uk/finance/comm ... nding.html

As "Thestone" correctly notes, public spending has barely been cut. I personally find this absolutely staggering.

I am not one to wear a tin foil hat, but I can see big problems ahead. The US financial tin can has been kicked further down the road and with the eurozone in the eye of the storm, the laser beam may soon be turned on Sterling.

Public spending grows when economies shrink.

You can do a lot of public spending cuts and end up spending more.

90s Japan is the nearest example I can find to what is happening now in the Eurozone. A decade and a half of stagnation sfter a crash.

Kieran_Burns

I think people should spend some time reading this:

http://www.moneyweek.com/endofbritain

Don't blame me for how you feel afterwards.

This is a taster:

coopster_the_1st

Sewinman wrote:

Coopster the 1st wrote:

Let's put this simplified scenario to you taking your personal finances:

- In the year 2000 you are earning £25k a year
- You predict you will be earning £40k in 2005
- Because you will earn £40k in 2005, you spend £40k this year and every year upto 2005 knowing that in 2005 you will be earning enough to cover what you are spending. You are borrowing to cover your spending
- Year earn £40k in 2005
- You predict you will earn £60k in 2010
- You spend £60k in 2005 and every following year with the knowledge your 2010 earnings will cover this. Again you are borrowing to cover your spending
- In 2007 you are earning £50k and on your way to a £60k salary in 2010
- In 2008 you get a paycut to £45k and stay at that salary for the next 3 years but you still spend £60k a year

It comes to 2010 and your bank says that are your salary is no longer rising and you have so much debt that you are now no longer allowed to borrow to cover your spending. How much pain and how long do you think it will take for you to get to a point where you would be comfortable again?

The above on a much larger scale is what we are now having to deal with. I don't think it matters who is in charge of the plan, until we are at a resolution, it is going to be painful!

The trouble with simplified scenarios using personal finance to analyse government spending is that they have absolutely sod all to do with government spending.

Completely disagree!!!

Income, spending and debt are exactly the same whether it is personal finance, a company or a government. It is just the size and who you transact with that is different

rick_chasey

Coopster the 1st wrote:

Sewinman wrote:

Coopster the 1st wrote:

Let's put this simplified scenario to you taking your personal finances:

- In the year 2000 you are earning £25k a year
- You predict you will be earning £40k in 2005
- Because you will earn £40k in 2005, you spend £40k this year and every year upto 2005 knowing that in 2005 you will be earning enough to cover what you are spending. You are borrowing to cover your spending
- Year earn £40k in 2005
- You predict you will earn £60k in 2010
- You spend £60k in 2005 and every following year with the knowledge your 2010 earnings will cover this. Again you are borrowing to cover your spending
- In 2007 you are earning £50k and on your way to a £60k salary in 2010
- In 2008 you get a paycut to £45k and stay at that salary for the next 3 years but you still spend £60k a year

It comes to 2010 and your bank says that are your salary is no longer rising and you have so much debt that you are now no longer allowed to borrow to cover your spending. How much pain and how long do you think it will take for you to get to a point where you would be comfortable again?

The above on a much larger scale is what we are now having to deal with. I don't think it matters who is in charge of the plan, until we are at a resolution, it is going to be painful!

The trouble with simplified scenarios using personal finance to analyse government spending is that they have absolutely sod all to do with government spending.

Completely disagree!!!

Income, spending and debt are exactly the same whether it is personal finance, a company or a government. It is just the size and who you transact with that is different

err. No.

There's a reason economics is split very broadly between macro and micro.

rick_chasey

Kieran_Burns wrote:

I think people should spend some time reading this:

http://www.moneyweek.com/endofbritain

Don't blame me for how you feel afterwards.

This is a taster:

Is that graph normalised for "real" debt? Doesn't look like it is.

greg66_tri_v2.0

Rick Chasey wrote:

90s Japan is the nearest example I can find to what is happening now in the Eurozone. A decade and a half of stagnation sfter a crash.

Gadzooks!

I do believe that we agree on something!

EKE_38BPM

TheStone wrote:

EKE_38BPM wrote:

If what each shop was re-regulated so that you couldn't stray too far from your core business e.g.pharmacists could only sell drugs and healthcare related products, electrical/electronics shops could only sell electrical/electronics and their related products, petrol stations sell fuel, oil and snacks, then smaller shops would claw back custom from supermarkets. This would put money in the pockets of the small business owner and would be spread around the community rather than going into the coffers of the supermarkets AND we would get more diverse High streets.

Make the supermarkets get back to their core business of groceries, not cameras, TV, pharmaceuticals, petrol et al

That sounds like France. :shock:

Head towards a more French way of shopping and their High streets or a more American way of shopping.
France

America

Sewinman

Kieran_Burns wrote:

I think people should spend some time reading this:

http://www.moneyweek.com/endofbritain

Don't blame me for how you feel afterwards.

This is a taster:

I feel like I have read some barely disguised political propaganda. Thanks.

davmaggs

DonDaddyD wrote:

Osborne cut too quickly too harshly. He should have taken a slowly more managable deficit reduction approach so that the economy could compensate with it.

Its been done to death in the politics pages;

The cuts are virtually a myth and you are just parroting the Ed Balls soundbite. There is of course some very obvious and public downsizing in selected areas, but spending has barely moved (even accounting for benefits). The cuts were announcements (which both parties were virtually identical on) more than reality.

There's a conspiracy in politics about the cuts. HMG wants to sound tough so they keep saying that they'll be happening, and Ed Balls et al want to oppose HMG so they pretend to agree that there are massive cuts taking place.

greg66_tri_v2.0

Sewinman wrote:

Kieran_Burns wrote:

I think people should spend some time reading this:

http://www.moneyweek.com/endofbritain

Don't blame me for how you feel afterwards.

<snip>

I feel like I have read some barely disguised political propaganda. Thanks.

Not so much political propaganda as sales pitch wrapped in hysteria.

Lots of different fonts, lots of different colours, lots of arrows overlaid onto graphs. The basic message is "The end of western civilisation is upon us, but YOU can SAVE YOURSELF simply by subscribing to our magazine".

Uh-huh.

DonDaddyD

davmaggs wrote:

DonDaddyD wrote:

Osborne cut too quickly too harshly. He should have taken a slowly more managable deficit reduction approach so that the economy could compensate with it.

Its been done to death in the politics pages;

The cuts are virtually a myth and you are just parroting the Ed Balls soundbite. There is of course some very obvious and public downsizing in selected areas, but spending has barely moved (even accounting for benefits). The cuts were announcements (which both parties were virtually identical on) more than reality.

There's a conspiracy in politics about the cuts. HMG wants to sound tough so they keep saying that they'll be happening, and Ed Balls et al want to oppose HMG so they pretend to agree that there are massive cuts taking place.

So what are they spending this continued borrowed money on?

The NHS is beginning to cost less and will continue to cost less as they move to GP commissioning and a pseudo open market - Virgin (yes Richard Branson's Virgin) has now started providing NHS healthcare. Also add the fact that they've devolved NHS funding to Councils masks the fact that there is a reduction in funding to the NHS along with the fact that mosts Trusts have to make a year on year 3% - 5% saving anyway. (This is annoying because the Government has made it look as though NHS funding is ring fenced in reality it really isn't).

Then there is a reduction in police funding, fire services and in general local Councils are spending less, forced to spend less and make year on year savings on their already reduced budget.

The real question is what is the Government spending this money on?

DonDaddyD

Greg66 Tri v2.0 wrote:

Sewinman wrote:

Kieran_Burns wrote:

I think people should spend some time reading this:

http://www.moneyweek.com/endofbritain

Don't blame me for how you feel afterwards.

<snip>

I feel like I have read some barely disguised political propaganda. Thanks.

Not so much political propaganda as sales pitch wrapped in hysteria.

Lots of different fonts, lots of different colours, lots of arrows overlaid onto graphs. The basic message is "The end of western civilisation is upon us, but YOU can SAVE YOURSELF simply by subscribing to our magazine".

Uh-huh.

One has to ask, how's business, Greg?

Koncordski

EKE_38BPM wrote:

notsoblue wrote:

DonDaddyD wrote:

Veronese68 wrote:

DonDaddyD wrote:

Seriously though, everyone is broke, everything is expensive, no one is making anything and I thought the highstreet in Wimbledon looked barren until I went to Croydon - jeez.

Go to Raynes Park. Not far and supposedly it has the most occupied high street in the country or something. That'll cheer you up.

I went to Raynes Park, I looked for Woolworths, HMV, Game, Comet, Blockbuster, Jessops, JJB, Clinton Cards, Peacocks, Blacks, Barrets and La Senza. Couldn't find any of them.

Actually, I wonder if these shops will be missed? After all, the reason they're going under is that there just isn't a consumer base for that kind of stuff in that kind of shop any more. ...

Yes there is, its just that they (we) just get lots of that stuff from the massive supermarkets.
Why go to HMV when you can buy CDs and DVDs in Sainsburys.
Why go to Game when you can buy the latest games in Tesco.
Why go to Comet when you can buy kettles, toasters, fridges and TVs in ASDA.
Why go to Jessops when your phone has a a point and shoot camera built in but if you want something a little better all of the supermarkets will oblige.
All supermarkets sell cards
All supermarkets sell clothing and underdungers.

The internet is responsible for undercutting lots of High Street retailers and they were victims of people going into the shops, trying various products and then after spending shop staff time and effort trying to make a sale, eventually losing the sale to the internet. Bye bye Jessops, but Blockbusters will lose out to online film delivery and losing custom to supermarkets.

If what each shop was re-regulated so that you couldn't stray too far from your core business e.g.pharmacists could only sell drugs and healthcare related products, electrical/electronics shops could only sell electrical/electronics and their related products, petrol stations sell fuel, oil and snacks, then smaller shops would claw back custom from supermarkets. This would put money in the pockets of the small business owner and would be spread around the community rather than going into the coffers of the supermarkets AND we would get more diverse High streets.

Make the supermarkets get back to their core business of groceries, not cameras, TV, pharmaceuticals, petrol et al

I'm not against supermarkets per se, they were allowed to expand into different areas and, like any good business, they exploited the new situation and have profitted, but the government needs to legislate to re-regulate to rejuvenate the High street as this would stimulate small business and money moving around locally, which would aid growth.

You genuinely see the answer to this as bigger government and more regulation?

Seriously?

EKE_38BPM

Koncordski wrote:

EKE_38BPM wrote:

notsoblue wrote:

DonDaddyD wrote:

Veronese68 wrote:

DonDaddyD wrote:

Seriously though, everyone is broke, everything is expensive, no one is making anything and I thought the highstreet in Wimbledon looked barren until I went to Croydon - jeez.

Go to Raynes Park. Not far and supposedly it has the most occupied high street in the country or something. That'll cheer you up.

I went to Raynes Park, I looked for Woolworths, HMV, Game, Comet, Blockbuster, Jessops, JJB, Clinton Cards, Peacocks, Blacks, Barrets and La Senza. Couldn't find any of them.

Actually, I wonder if these shops will be missed? After all, the reason they're going under is that there just isn't a consumer base for that kind of stuff in that kind of shop any more. ...

Yes there is, its just that they (we) just get lots of that stuff from the massive supermarkets.
Why go to HMV when you can buy CDs and DVDs in Sainsburys.
Why go to Game when you can buy the latest games in Tesco.
Why go to Comet when you can buy kettles, toasters, fridges and TVs in ASDA.
Why go to Jessops when your phone has a a point and shoot camera built in but if you want something a little better all of the supermarkets will oblige.
All supermarkets sell cards
All supermarkets sell clothing and underdungers.

The internet is responsible for undercutting lots of High Street retailers and they were victims of people going into the shops, trying various products and then after spending shop staff time and effort trying to make a sale, eventually losing the sale to the internet. Bye bye Jessops, but Blockbusters will lose out to online film delivery and losing custom to supermarkets.

If what each shop was re-regulated so that you couldn't stray too far from your core business e.g.pharmacists could only sell drugs and healthcare related products, electrical/electronics shops could only sell electrical/electronics and their related products, petrol stations sell fuel, oil and snacks, then smaller shops would claw back custom from supermarkets. This would put money in the pockets of the small business owner and would be spread around the community rather than going into the coffers of the supermarkets AND we would get more diverse High streets.

Make the supermarkets get back to their core business of groceries, not cameras, TV, pharmaceuticals, petrol et al

I'm not against supermarkets per se, they were allowed to expand into different areas and, like any good business, they exploited the new situation and have profitted, but the government needs to legislate to re-regulate to rejuvenate the High street as this would stimulate small business and money moving around locally, which would aid growth.

You genuinely see the answer to this as bigger government and more regulation?

Seriously?

Not bigger government and only returning regulations to what they were. This won't miraculously make UK Plc profitable again, but could go a long way to rejuvenating the High street by helping small business.
Not all deregulation is a good thing and something should be done to change our High streets.

leeefm

DonDaddyD wrote:

So what are they spending this continued borrowed money on?

Well, with unemployment increasing (but allegedly recently falling?), additional unemployment benefit will be one. That combined with the reduction in tax receipts that these people would have paid if employed makes it a double whammy. It won't account for everything, but it is a factor...

daddy0

DonDaddyD wrote:

...until I went to Croydon

:shock:

rick_chasey

Koncordski wrote:

EKE_38BPM wrote:

notsoblue wrote:

DonDaddyD wrote:

Veronese68 wrote:

DonDaddyD wrote:

Seriously though, everyone is broke, everything is expensive, no one is making anything and I thought the highstreet in Wimbledon looked barren until I went to Croydon - jeez.

Go to Raynes Park. Not far and supposedly it has the most occupied high street in the country or something. That'll cheer you up.

I went to Raynes Park, I looked for Woolworths, HMV, Game, Comet, Blockbuster, Jessops, JJB, Clinton Cards, Peacocks, Blacks, Barrets and La Senza. Couldn't find any of them.

Actually, I wonder if these shops will be missed? After all, the reason they're going under is that there just isn't a consumer base for that kind of stuff in that kind of shop any more. ...

Yes there is, its just that they (we) just get lots of that stuff from the massive supermarkets.
Why go to HMV when you can buy CDs and DVDs in Sainsburys.
Why go to Game when you can buy the latest games in Tesco.
Why go to Comet when you can buy kettles, toasters, fridges and TVs in ASDA.
Why go to Jessops when your phone has a a point and shoot camera built in but if you want something a little better all of the supermarkets will oblige.
All supermarkets sell cards
All supermarkets sell clothing and underdungers.

The internet is responsible for undercutting lots of High Street retailers and they were victims of people going into the shops, trying various products and then after spending shop staff time and effort trying to make a sale, eventually losing the sale to the internet. Bye bye Jessops, but Blockbusters will lose out to online film delivery and losing custom to supermarkets.

If what each shop was re-regulated so that you couldn't stray too far from your core business e.g.pharmacists could only sell drugs and healthcare related products, electrical/electronics shops could only sell electrical/electronics and their related products, petrol stations sell fuel, oil and snacks, then smaller shops would claw back custom from supermarkets. This would put money in the pockets of the small business owner and would be spread around the community rather than going into the coffers of the supermarkets AND we would get more diverse High streets.

Make the supermarkets get back to their core business of groceries, not cameras, TV, pharmaceuticals, petrol et al

I'm not against supermarkets per se, they were allowed to expand into different areas and, like any good business, they exploited the new situation and have profitted, but the government needs to legislate to re-regulate to rejuvenate the High street as this would stimulate small business and money moving around locally, which would aid growth.

You genuinely see the answer to this as bigger government and more regulation?

Seriously?

Nothing wrong with a bit of well placed regulation.

People are just about wising up to it.

Correct the market failures, but still have a market to correct.

leeefm

There is a theory that regulation should completely be removed. Then when things fail, they fail small... It then becomes a game of life, survival of the fittest... Not necessarily correct, but an interesting thought, nonetheless.

notsoblue

leeefm wrote:

There is a theory that regulation should completely be removed. Then when things fail, they fail small... It then becomes a game of life, survival of the fittest... Not necessarily correct, but an interesting thought, nonetheless.

The principle of regulation isn't the problem, its the practice of it. Completely removing regulation would be anarchy.

walkingbootweather

notsoblue wrote:

Completely removing regulation would be anarchy.

Perhaps we should have a referendum to determine if the majority are in favour of anarchy?. I think it would have to be a straight in-out vote but we could perhaps spend 4 or 5 years debating on the type of anarchy we'd be voting for first.

tailwindhome

We're way behind were we need to be.......

FransJacques

DonDaddyD wrote:

Greg66 Tri v2.0 wrote:

Sewinman wrote:

Kieran_Burns wrote:

I think people should spend some time reading this:
http://www.moneyweek.com/endofbritain

Don't blame me for how you feel afterwards.

<snip>

I feel like I have read some barely disguised political propaganda. Thanks.

Not so much political propaganda as sales pitch wrapped in hysteria.

Lots of different fonts, lots of different colours, lots of arrows overlaid onto graphs. The basic message is "The end of western civilisation is upon us, but YOU can SAVE YOURSELF simply by subscribing to our magazine".

Uh-huh.

One has to ask, how's business, Greg?

This advertisement has caused quite the sheit storm on the web - lots of debunking sites/blogs up and running.

It bothers me b/c it ignores 2 important facts:

1 - the UK government borrows at a fixed rate, hence govvie debt is immune to rate moves, once issued.

2 - sovereign entities the size of the UK don't go bust, the default (Russia did in 97) but they restructure in stead of the sky falling and a plague of toads being crushed under your 404 Firecrests.

As for private debt? Why would the government want to curb people spending? No way, if they had it their way they'd give all Bulgarians and Romanians GBP denominated credit cards to buy the UK out of the slump. We're a services economy so someone must buy the damn services non?

Initialised

In topics like this I like to point out that Iceland did it right and we could too, makes you wonder why it never made the UK/US/EU news...

http://crazyemailsandbackstories.wordpr ... backstory/

But, they have a tendency to boycott road projects to protect the rights of elves so maybe not great role models.

Escadrille Ecosse

Initialised wrote:

In topics like this I like to point out that Iceland did it right and we could too, makes you wonder why it never made the UK/US/EU news...

http://crazyemailsandbackstories.wordpr ... backstory/

But, they have a tendency to boycott road projects to protect the rights of elves so maybe not great role models.

Because it doesn't fit the free trade / deregulation model that we seem to be wedded to. Unfortunately it was this model that got us into this mess over the last 20 -30 years or so and I doubt it will get us back out.

There is NO major economy in the world that became established through unregulated free trade and no major growing economy (eg China) that has adopted this model so why-oh-why do we buy it. The only thing it does is allow distribution of wealth the become ever more polarised.

Initialised

Escadrille Ecosse wrote:

Initialised wrote:

In topics like this I like to point out that Iceland did it right and we could too, makes you wonder why it never made the UK/US/EU news...

http://crazyemailsandbackstories.wordpr ... backstory/

But, they have a tendency to boycott road projects to protect the rights of elves so maybe not great role models.

Because it doesn't fit the free trade / deregulation model that we seem to be wedded to. Unfortunately it was this model that got us into this mess over the last 20 -30 years or so and I doubt it will get us back out.

There is NO major economy in the world that became established through unregulated free trade and no major growing economy (eg China) that has adopted this model so why-oh-why do we buy it. The only thing it does is allow distribution of wealth the become ever more polarised.

Iceland showed it can be shaken off, western media (lack of) coverage of this and Madrid showed that the governments of the western world are terrified that it could be and that those that caused the mess might be brought to justice.

In the mean time I'm banking on Cryptocurrency as a means of riding the coming storm, assuming that the internet (at least in P2P form) survives.