Today's discussion about the news
Comments
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In some cases it was six years longer. I think most of the complaining is really about having to work a lot longer than many of their similar aged friends i.e. the change came in quickly. Jealously doesn't count for much, so the official argument is about lack of notification which meant that some retired earlier than they could afford to.
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The friends were very lucky to retire 6 years earlier than men the same age then.
The complainers were just a bit less lucky but will still retire at least a couple of years younger than I will.
If they retired early with a private pension/savings just about big enough to carry them through to the assumed state pension age then it's a bit rich expecting the gov to stump up for the difference.
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It gets lent in general, with resi property an easy sector to target for additional lending volumes. Hence my comment "funds for banks to lend to fuel house price inflation".
Key words being "lend" and "house".
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I agree with you, but I also think the claim against Birmingham City Council is a bit dubious.
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I don't understand the name - the one thing they are campaigning for is state pension inequality.
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Yep, being in the fortunate position to be able to retire early then complaining about the hardship. I'm amazed they managed to get any sympathy to start with. These aren't pensioners that are struggling to make ends meet on a state pension and maybe a bit of a private pension. I wonder what the venn diagram looks like between them and people complaining about benefit scroungers?
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Same here, I'm also not sure how good it is for them to bankrupt their employer and presumably force redundancies. If men and women are doing the same job then obviously they should get paid the same but trying to say role 'x' is the same as role 'y' and should be paid the same is nonsense.
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Yeah, well, that's another subject. The wheels came off the property waggon when they removed the 2.5/3x salary cap and the buying public were complicit.
Back to slightly on topic, business loans come from savers deposits. No deposits, no loans, no growth.
The above may be fact, or fiction, I may be serious, I may be jesting.
I am not sure. You have no chance.Veronese68 wrote:PB is the most sensible person on here.0 -
That's not strictly true though. Banks loan a lot more money than they actually have deposited with them.
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They can only loan money that they have. I can't lend you my bike, if I don't have a bike to lend; however, if I lend you a bike and you give it back to me for safe keeping, then I can lend it to someone else with a net result that I have lent two bikes.
I think you are talking about the money multiplier which affects the money supply. There is an amount of money in existence and determined by the Bank of England, this is then effectively increased by banks lending money. Lots of the growth pre-2008 came from banks increasing the money supply.
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Isn't it more that the banks lend several people the same bicycle, on the assumption that someone will return it before the next person uses it?
Or, perhaps you have 100 Boris bikes and... I give up.
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I can't claim to fully understand it properly but this is what I'd read https://www.investopedia.com/articles/investing/022416/why-banks-dont-need-your-money-make-loans.asp which might also be what your analogy is alluding to.
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Labour are definitely making the right decision, it's just unfortunate they spent so long arguing in favour of some sort of compensation.
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Who knew that parties took stances in opposition that they don't follow through with when in power?
That said, it's another example of Labour not laying the political groundwork well enough for the announcement.
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Meh, I think just because it's something that generally happens, it doesn't make it fine when parties do it. Good opposition should be about more than simply opposing everything the other party does and says.
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I think it's quite poorly written which is not to say that it is wrong, but it is misleading. When a bank lends money, the borrower typically does something with the money like buy a house or a Ferrari. They don't leave the money on deposit at the bank. What then happens is the recipient of the funds (house seller or car dealer) will put the money on deposit at a bank which is not necessarily the same bank as the one that made the loan in the first place. The bank that receives that money can then lend it on again - the point being that they do need the money to lend, but overall there is more money in existence due to this system.
This ability of banks, as a group, to create money then leads to conspiracy theories about the whole thing. However, the BoE controls how much capital they must keep back, and therefore the BoE controls the money supply at all levels.
Probably no one cares, but one of things that led to the financial crisis was the amount of capital banks were required to hold was changed. Originally, there was no risk weighting, so banks were not incentivised to hold high quality assets. Then they brought in risk weighting which meant banks held loads of AAA CDOs and lent even more money. A foolproof plan until all the AAA assets were written down to junk
These days the capital models are really complicated.
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Right so you have 100 Boris bikes and you loan them to 1000 people, so that each person can have one Boris bike, thus creating 900 Boris bikes out of nothing
Those people can all do whatever they want with the Boris bike, including renting it out, selling it for parts exchanging it for a Chopper etc., providing they undertake to give the Boris bike back eventually.
The bank needs to have at least 10 actual Boris bikes in reserve in case anyone who already owns one actually intends to use it, and every few years, more people want their bikes at one time than there are bikes in existence, so the government has to manufacture more Boris bikes so that the bike sharing scheme doesn't go under.
Is that correct?
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It's not that easy in terms of bikes, but a few points on this:
- Until someone claims the bike the bank is in possession of 100 bikes
- In your example, when the bank lends a bike to someone that person immediately lends it back to the bank. This doesn't really make sense and it would be very easy to unwind.
- The 1000 people who think they own bikes just have IOUs. They don't have actual bikes. They also owe the banks a bike. This is where the analogy doesn't really work.
- If someone claims a bike, then the bank will only possess 99 bikes, but they will have a bike IOU from a customer. There will still only be 100 bikes in existence. 99 with the bank and one with a customer.
- You can't ride an IOU
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Would it work better with Pelotons? A lot of people like the idea of having one of those, but don't actually use them.
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Here is something nobody ever thinks about.
Bank of England notes are just IOU's getting passed around.
The above may be fact, or fiction, I may be serious, I may be jesting.
I am not sure. You have no chance.Veronese68 wrote:PB is the most sensible person on here.0 -
Don't disagree, but I pay little attention to manifestos or statements made in opposition, given the track record. And sadly, I think it's only going to get worse, given the general quality of politics and politicians.
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Yup. I judge people (and parties) by what they do, not what they say. Starmer has not got off to a good start and once trust has been lost... Goes some way to explain the tory decline, nobody trusted them any more.
The above may be fact, or fiction, I may be serious, I may be jesting.
I am not sure. You have no chance.Veronese68 wrote:PB is the most sensible person on here.0 -
I think we're actually agreeing!
My observation was that if we're all expected to hold a "rainy day fund" in respect of arbitrary and potentially very significant changes to the tax regime then we'll all have to have large amounts of cash on deposit in order to cover the impact. More cash on deposit => less cash for general spending but more for banks to lend => higher house prices.
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Not quite. I'd have kept limit for mortgages but that genie is out of the bottle. That left more for business loans and house prices under an amount of control.
The above may be fact, or fiction, I may be serious, I may be jesting.
I am not sure. You have no chance.Veronese68 wrote:PB is the most sensible person on here.0 -
The key thing though is rather than worry about how banks "create money", if folk put cash on deposit rather than spending it, banks will be able to lend more. And they will lend more because that's what banks do to make a profit. (The old "3-6-3" model for banking: Borrow at 3%, lend at 6%, on the golf course at 3pm.)
And some of that additional lending will find its way into the resi mortgage market, as it's a relatively easy way to generate a profit most of the time.
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We are way off topic now and I'm done. My basic point was savings are not out of the economy.
The above may be fact, or fiction, I may be serious, I may be jesting.
I am not sure. You have no chance.Veronese68 wrote:PB is the most sensible person on here.0 -
Fair point. Just recycled from normal everyday economic activity into making housing even less affordable for the youngsters. Where's Chasey to remind us of the social ills that this creates? ;)
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Sorry to be dull, but this is wrong. If people choose to save rather than spend it has no impact on the overall money supply because the seller would have the money in their bank account instead. It would affect the economy though.
Also, I think you have overreacted to the suggestion that there is a tax risk in life.
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To be fair, it was the council itself that graded roles and then paid more for male dominated roles. For example binmen were put at the same banding as Teaching Assistants. The male dominated roles were then given bonuses which effectively doubled their salaries. The largely female dominated roles were not offered or given access to similar bonuses. Effectively the council were gaming their own pay grading to reward male workers.
I have to admit to a conflict of interest as a family member was involved in this, but it is definitely not the same circumstances as the WASPI claim.
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