Macroeconomics, the economy, inflation etc. *likely to be very dull*

pblakeney

TheBigBean said:

surrey_commuter said:

So the Govt borrowed £14bn in May half of which was to service existing debt.

As inflation persists this number will only get worse

I don't mean to sound like a broken record, but how much of that went to the Bank of England and then back to the treasury? I'm curious how that amount is even included in the goverment's budget. Perhaps it is already included as a receipt.

Neatly why summing up why I can't get past the whole system being smoke and mirrors.

surrey_commuter

pblakeney said:

TheBigBean said:

surrey_commuter said:

So the Govt borrowed £14bn in May half of which was to service existing debt.

As inflation persists this number will only get worse

I don't mean to sound like a broken record, but how much of that went to the Bank of England and then back to the treasury? I'm curious how that amount is even included in the goverment's budget. Perhaps it is already included as a receipt.

Neatly why summing up why I can't get past the whole system being smoke and mirrors.

The answer to TBB's question could be 50% (at worse) which would still mean that debt servicing costs were the same a Defence spending. Next milestone will be when we spend more servicing existing debt than we do on Education.

rick_chasey

surrey_commuter said:

pblakeney said:

TheBigBean said:

surrey_commuter said:

So the Govt borrowed £14bn in May half of which was to service existing debt.

As inflation persists this number will only get worse

I don't mean to sound like a broken record, but how much of that went to the Bank of England and then back to the treasury? I'm curious how that amount is even included in the goverment's budget. Perhaps it is already included as a receipt.

Neatly why summing up why I can't get past the whole system being smoke and mirrors.

The answer to TBB's question could be 50% (at worse) which would still mean that debt servicing costs were the same a Defence spending. Next milestone will be when we spend more servicing existing debt than we do on Education.

It is indeed a problem when the economy doesn’t grow in 14-15 years.

You grow your way out of debt.

pblakeney

Remember a time when debt wasn't a problem?
Doesn't seem that long ago.

rjsterry

surrey_commuter said:

pblakeney said:

TheBigBean said:

surrey_commuter said:

So the Govt borrowed £14bn in May half of which was to service existing debt.

As inflation persists this number will only get worse

I don't mean to sound like a broken record, but how much of that went to the Bank of England and then back to the treasury? I'm curious how that amount is even included in the goverment's budget. Perhaps it is already included as a receipt.

Neatly why summing up why I can't get past the whole system being smoke and mirrors.

The answer to TBB's question could be 50% (at worse) which would still mean that debt servicing costs were the same a Defence spending. Next milestone will be when we spend more servicing existing debt than we do on Education.

Just for context, can you give an example of any government that doesn't pay a really big number in debt interest. Seeing as governments issue all money, I do find the whole 'living within our means' thing somewhat academic. Surely their fundamental task is to avoid devaluation of the currency. Everything else is adjustment.

TheBigBean

rjsterry said:

surrey_commuter said:

pblakeney said:

TheBigBean said:

surrey_commuter said:

So the Govt borrowed £14bn in May half of which was to service existing debt.

As inflation persists this number will only get worse

I don't mean to sound like a broken record, but how much of that went to the Bank of England and then back to the treasury? I'm curious how that amount is even included in the goverment's budget. Perhaps it is already included as a receipt.

Neatly why summing up why I can't get past the whole system being smoke and mirrors.

The answer to TBB's question could be 50% (at worse) which would still mean that debt servicing costs were the same a Defence spending. Next milestone will be when we spend more servicing existing debt than we do on Education.

Just for context, can you give an example of any government that doesn't pay a really big number in debt interest. Seeing as governments issue all money, I do find the whole 'living within our means' thing somewhat academic. Surely their fundamental task is to avoid devaluation of the currency. Everything else is adjustment.

I think this is, in my opinion, broadly right. The danger of printing too much money is it ultimately junks the currency. The government and the Bank of England's job is to stop this happening.

surrey_commuter

TheBigBean said:

rjsterry said:

surrey_commuter said:

pblakeney said:

TheBigBean said:

surrey_commuter said:

So the Govt borrowed £14bn in May half of which was to service existing debt.

As inflation persists this number will only get worse

I don't mean to sound like a broken record, but how much of that went to the Bank of England and then back to the treasury? I'm curious how that amount is even included in the goverment's budget. Perhaps it is already included as a receipt.

Neatly why summing up why I can't get past the whole system being smoke and mirrors.

The answer to TBB's question could be 50% (at worse) which would still mean that debt servicing costs were the same a Defence spending. Next milestone will be when we spend more servicing existing debt than we do on Education.

Just for context, can you give an example of any government that doesn't pay a really big number in debt interest. Seeing as governments issue all money, I do find the whole 'living within our means' thing somewhat academic. Surely their fundamental task is to avoid devaluation of the currency. Everything else is adjustment.

I think this is, in my opinion, broadly right. The danger of printing too much money is it ultimately junks the currency. The government and the Bank of England's job is to stop this happening.

This article in today's Times backs you both up https://www.thetimes.co.uk/article/devaluation-of-sterling-points-to-britains-economic-weakness-863vpmnrt

My disagreement would be around cause and effect. Is your currency falling because of printing money or because of general economic incompetence?

rick_chasey

100% the latter.

rjsterry

TheBigBean said:

rjsterry said:

surrey_commuter said:

pblakeney said:

TheBigBean said:

surrey_commuter said:

So the Govt borrowed £14bn in May half of which was to service existing debt.

As inflation persists this number will only get worse

I don't mean to sound like a broken record, but how much of that went to the Bank of England and then back to the treasury? I'm curious how that amount is even included in the goverment's budget. Perhaps it is already included as a receipt.

Neatly why summing up why I can't get past the whole system being smoke and mirrors.

The answer to TBB's question could be 50% (at worse) which would still mean that debt servicing costs were the same a Defence spending. Next milestone will be when we spend more servicing existing debt than we do on Education.

Just for context, can you give an example of any government that doesn't pay a really big number in debt interest. Seeing as governments issue all money, I do find the whole 'living within our means' thing somewhat academic. Surely their fundamental task is to avoid devaluation of the currency. Everything else is adjustment.

I think this is, in my opinion, broadly right. The danger of printing too much money is it ultimately junks the currency. The government and the Bank of England's job is to stop this happening.

But also not go too far the other way and have not enough money in circulation.

rjsterry

surrey_commuter said:

TheBigBean said:

rjsterry said:

surrey_commuter said:

pblakeney said:

TheBigBean said:

surrey_commuter said:

So the Govt borrowed £14bn in May half of which was to service existing debt.

As inflation persists this number will only get worse

I don't mean to sound like a broken record, but how much of that went to the Bank of England and then back to the treasury? I'm curious how that amount is even included in the goverment's budget. Perhaps it is already included as a receipt.

Neatly why summing up why I can't get past the whole system being smoke and mirrors.

The answer to TBB's question could be 50% (at worse) which would still mean that debt servicing costs were the same a Defence spending. Next milestone will be when we spend more servicing existing debt than we do on Education.

Just for context, can you give an example of any government that doesn't pay a really big number in debt interest. Seeing as governments issue all money, I do find the whole 'living within our means' thing somewhat academic. Surely their fundamental task is to avoid devaluation of the currency. Everything else is adjustment.

I think this is, in my opinion, broadly right. The danger of printing too much money is it ultimately junks the currency. The government and the Bank of England's job is to stop this happening.

This article in today's Times backs you both up https://www.thetimes.co.uk/article/devaluation-of-sterling-points-to-britains-economic-weakness-863vpmnrt

My disagreement would be around cause and effect. Is your currency falling because of printing money or because of general economic incompetence?

Not sure it's an either-or question, but surely economic incompetence covers printing too much money to the point that the value drops. I looked at a list of countries by debt to gdp ratio and it's notable that the countries with the lowest ratings tend to be what you might consider more risky.

TheBigBean

rjsterry said:

surrey_commuter said:

TheBigBean said:

rjsterry said:

surrey_commuter said:

pblakeney said:

TheBigBean said:

surrey_commuter said:

So the Govt borrowed £14bn in May half of which was to service existing debt.

As inflation persists this number will only get worse

I don't mean to sound like a broken record, but how much of that went to the Bank of England and then back to the treasury? I'm curious how that amount is even included in the goverment's budget. Perhaps it is already included as a receipt.

Neatly why summing up why I can't get past the whole system being smoke and mirrors.

The answer to TBB's question could be 50% (at worse) which would still mean that debt servicing costs were the same a Defence spending. Next milestone will be when we spend more servicing existing debt than we do on Education.

Just for context, can you give an example of any government that doesn't pay a really big number in debt interest. Seeing as governments issue all money, I do find the whole 'living within our means' thing somewhat academic. Surely their fundamental task is to avoid devaluation of the currency. Everything else is adjustment.

I think this is, in my opinion, broadly right. The danger of printing too much money is it ultimately junks the currency. The government and the Bank of England's job is to stop this happening.

This article in today's Times backs you both up https://www.thetimes.co.uk/article/devaluation-of-sterling-points-to-britains-economic-weakness-863vpmnrt

My disagreement would be around cause and effect. Is your currency falling because of printing money or because of general economic incompetence?

Not sure it's an either-or question, but surely economic incompetence covers printing too much money to the point that the value drops. I looked at a list of countries by debt to gdp ratio and it's notable that the countries with the lowest ratings tend to be what you might consider more risky.

In all walks of life, you can borrow more the less risky you are.

TheBigBean

surrey_commuter said:

TheBigBean said:

rjsterry said:

surrey_commuter said:

pblakeney said:

TheBigBean said:

surrey_commuter said:

So the Govt borrowed £14bn in May half of which was to service existing debt.

As inflation persists this number will only get worse

I don't mean to sound like a broken record, but how much of that went to the Bank of England and then back to the treasury? I'm curious how that amount is even included in the goverment's budget. Perhaps it is already included as a receipt.

Neatly why summing up why I can't get past the whole system being smoke and mirrors.

The answer to TBB's question could be 50% (at worse) which would still mean that debt servicing costs were the same a Defence spending. Next milestone will be when we spend more servicing existing debt than we do on Education.

Just for context, can you give an example of any government that doesn't pay a really big number in debt interest. Seeing as governments issue all money, I do find the whole 'living within our means' thing somewhat academic. Surely their fundamental task is to avoid devaluation of the currency. Everything else is adjustment.

I think this is, in my opinion, broadly right. The danger of printing too much money is it ultimately junks the currency. The government and the Bank of England's job is to stop this happening.

This article in today's Times backs you both up https://www.thetimes.co.uk/article/devaluation-of-sterling-points-to-britains-economic-weakness-863vpmnrt

My disagreement would be around cause and effect. Is your currency falling because of printing money or because of general economic incompetence?

Is it falling? GBP - EUR has been at about the same level since 2008 ignoring a brief peak in 2016. Before then it was higher.

GBP is notably lower against USD though.

rjsterry

TheBigBean said:

rjsterry said:

surrey_commuter said:

TheBigBean said:

rjsterry said:

surrey_commuter said:

pblakeney said:

TheBigBean said:

surrey_commuter said:

So the Govt borrowed £14bn in May half of which was to service existing debt.

As inflation persists this number will only get worse

I don't mean to sound like a broken record, but how much of that went to the Bank of England and then back to the treasury? I'm curious how that amount is even included in the goverment's budget. Perhaps it is already included as a receipt.

Neatly why summing up why I can't get past the whole system being smoke and mirrors.

The answer to TBB's question could be 50% (at worse) which would still mean that debt servicing costs were the same a Defence spending. Next milestone will be when we spend more servicing existing debt than we do on Education.

Just for context, can you give an example of any government that doesn't pay a really big number in debt interest. Seeing as governments issue all money, I do find the whole 'living within our means' thing somewhat academic. Surely their fundamental task is to avoid devaluation of the currency. Everything else is adjustment.

I think this is, in my opinion, broadly right. The danger of printing too much money is it ultimately junks the currency. The government and the Bank of England's job is to stop this happening.

This article in today's Times backs you both up https://www.thetimes.co.uk/article/devaluation-of-sterling-points-to-britains-economic-weakness-863vpmnrt

My disagreement would be around cause and effect. Is your currency falling because of printing money or because of general economic incompetence?

Not sure it's an either-or question, but surely economic incompetence covers printing too much money to the point that the value drops. I looked at a list of countries by debt to gdp ratio and it's notable that the countries with the lowest ratings tend to be what you might consider more risky.

In all walks of life, you can borrow more the less risky you are.

And if you can set your own interest rate and borrow from your self, who can say they wouldn't.

focuszing723

Is it correct, the UK's debt is 2.4 trillion quid?

photonic69

Chatted to a Prof of Economics a couple of days back. I asked him bluntly what was his and his colleagues economic forecast. He said he’d be very, very surprised if we didn’t go into a major, hard hitting recession. He thinks it’s the only thing that will halt the cost of living/wage rise spiral.

It all feels rather bleak and depressing. I pity those with large mortgages.

Jezyboy

Is there a cost of living wage rise spiral?

Don't know anyone apart from pensioners getting a pay rise that's inline with inflation.

mully79

Inflation is mostly just gas and fuel. Both are clearly a stitch up but it does have to cause real pain so Boris can pretend to be the hero when he comes to our rescue.

rick_chasey

photonic69 said:

Chatted to a Prof of Economics a couple of days back. I asked him bluntly what was his and his colleagues economic forecast. He said he’d be very, very surprised if we didn’t go into a major, hard hitting recession. He thinks it’s the only thing that will halt the cost of living/wage rise spiral.

It all feels rather bleak and depressing. I pity those with large mortgages.

Tbh I spoke to about 9 and reported back bad news and got told I didn’t know what I was talking about so good luck.

TheBigBean

rick_chasey said:

photonic69 said:

Chatted to a Prof of Economics a couple of days back. I asked him bluntly what was his and his colleagues economic forecast. He said he’d be very, very surprised if we didn’t go into a major, hard hitting recession. He thinks it’s the only thing that will halt the cost of living/wage rise spiral.

It all feels rather bleak and depressing. I pity those with large mortgages.

Tbh I spoke to about 9 and reported back bad news and got told I didn’t know what I was talking about so good luck.

You also said that there wouldn't be much inflation...

focuszing723

I remember the experts telling us don't worry about the escalating Government debt because interest rates are near to zero percent. History shows that isn't normal.

pblakeney

focuszing723 said:

I remember the experts telling us don't worry about the escalating Government debt because interest rates are near to zero percent. History shows that isn't normal.

Has to be said that comments along those lines a year to two ago haven't aged well.

surrey_commuter

focuszing723 said:

Is it correct, the UK's debt is 2.4 trillion quid?

There is other stuff, most notably public sector pension liabilities, that doubles that number.

surrey_commuter

pblakeney said:

focuszing723 said:

I remember the experts telling us don't worry about the escalating Government debt because interest rates are near to zero percent. History shows that isn't normal.

Has to be said that comments along those lines a year to two ago haven't aged well.

I have felt like a lone voice arguing that. IMHO we are only in the foothills

pblakeney

surrey_commuter said:

pblakeney said:

focuszing723 said:

I remember the experts telling us don't worry about the escalating Government debt because interest rates are near to zero percent. History shows that isn't normal.

Has to be said that comments along those lines a year to two ago haven't aged well.

I have felt like a lone voice arguing that. IMHO we are only in the foothills

Nah. There were two of us. We were the moaning pessimistic old sods. Was expecting the Statler and Waldorf comments. 😉

rick_chasey

TheBigBean said:

rick_chasey said:

photonic69 said:

Chatted to a Prof of Economics a couple of days back. I asked him bluntly what was his and his colleagues economic forecast. He said he’d be very, very surprised if we didn’t go into a major, hard hitting recession. He thinks it’s the only thing that will halt the cost of living/wage rise spiral.

It all feels rather bleak and depressing. I pity those with large mortgages.

Tbh I spoke to about 9 and reported back bad news and got told I didn’t know what I was talking about so good luck.

You also said that there wouldn't be much inflation...

In the context of it being transitory because it’s a supply side issue.

pblakeney

rick_chasey said:

TheBigBean said:

rick_chasey said:

photonic69 said:

Chatted to a Prof of Economics a couple of days back. I asked him bluntly what was his and his colleagues economic forecast. He said he’d be very, very surprised if we didn’t go into a major, hard hitting recession. He thinks it’s the only thing that will halt the cost of living/wage rise spiral.

It all feels rather bleak and depressing. I pity those with large mortgages.

Tbh I spoke to about 9 and reported back bad news and got told I didn’t know what I was talking about so good luck.

You also said that there wouldn't be much inflation...

In the context of it being transitory because it’s a supply side issue.

How long do you expect this transition to last? How long will inflation be at 5% or higher? Months or years? I will lay it on the line and say years.

TheBigBean

rick_chasey said:

TheBigBean said:

rick_chasey said:

photonic69 said:

Chatted to a Prof of Economics a couple of days back. I asked him bluntly what was his and his colleagues economic forecast. He said he’d be very, very surprised if we didn’t go into a major, hard hitting recession. He thinks it’s the only thing that will halt the cost of living/wage rise spiral.

It all feels rather bleak and depressing. I pity those with large mortgages.

Tbh I spoke to about 9 and reported back bad news and got told I didn’t know what I was talking about so good luck.

You also said that there wouldn't be much inflation...

In the context of it being transitory because it’s a supply side issue.

You said no more than six months and it wouldn't affect wages. I'm sure you will contend the last part is still true, but it is at odds with all the central bank action.

The point being that if there is a recession it will have been caused by central banks trying to control inflation, so you can't be right about both.

skyblueamateur

pblakeney said:

rick_chasey said:

TheBigBean said:

rick_chasey said:

photonic69 said:

Chatted to a Prof of Economics a couple of days back. I asked him bluntly what was his and his colleagues economic forecast. He said he’d be very, very surprised if we didn’t go into a major, hard hitting recession. He thinks it’s the only thing that will halt the cost of living/wage rise spiral.

It all feels rather bleak and depressing. I pity those with large mortgages.

Tbh I spoke to about 9 and reported back bad news and got told I didn’t know what I was talking about so good luck.

You also said that there wouldn't be much inflation...

In the context of it being transitory because it’s a supply side issue.

How long do you expect this transition to last? How long will inflation be at 5% or higher? Months or years? I will lay it on the line and say years.

Unless we strengthen the pound it will be years.

pblakeney

skyblueamateur said:

pblakeney said:

rick_chasey said:

TheBigBean said:

rick_chasey said:

photonic69 said:

Chatted to a Prof of Economics a couple of days back. I asked him bluntly what was his and his colleagues economic forecast. He said he’d be very, very surprised if we didn’t go into a major, hard hitting recession. He thinks it’s the only thing that will halt the cost of living/wage rise spiral.

It all feels rather bleak and depressing. I pity those with large mortgages.

Tbh I spoke to about 9 and reported back bad news and got told I didn’t know what I was talking about so good luck.

You also said that there wouldn't be much inflation...

In the context of it being transitory because it’s a supply side issue.

How long do you expect this transition to last? How long will inflation be at 5% or higher? Months or years? I will lay it on the line and say years.

Unless we strengthen the pound it will be years.

How do you strengthen the Pound? Increase interest rates?
Which causes a recession. Which devalues the Pound. Hmmm. 🤔

rick_chasey

TheBigBean said:

rick_chasey said:

TheBigBean said:

rick_chasey said:

photonic69 said:

Chatted to a Prof of Economics a couple of days back. I asked him bluntly what was his and his colleagues economic forecast. He said he’d be very, very surprised if we didn’t go into a major, hard hitting recession. He thinks it’s the only thing that will halt the cost of living/wage rise spiral.

It all feels rather bleak and depressing. I pity those with large mortgages.

Tbh I spoke to about 9 and reported back bad news and got told I didn’t know what I was talking about so good luck.

You also said that there wouldn't be much inflation...

In the context of it being transitory because it’s a supply side issue.

You said no more than six months and it wouldn't affect wages. I'm sure you will contend the last part is still true, but it is at odds with all the central bank action.

The point being that if there is a recession it will have been caused by central banks trying to control inflation, so you can't be right about both.

Yeah I think lots of people underestimated the level of the supply chain disruption - it’s not been helped by China disrupting things by continuing big lockdowns.