Possible Tax Cuts on the way

napoleon

Dan: wrote: »

but we need to get people spending.

Where are we going to get the money from? Put it on the never, never, eh?

This is hospital pass for the Tories from Labour. The economy is going to be like Zimbabwe by the time the Tories take power. :rotfl:

ALIBOBSY

So GB strikes again, not satisfied by inflating a housing/lending bubble to delay a downturn in the economic cycle (end to boom and bust HA!) he now resorts to keynesian economics-didn't that just prolong the great depression when the us used it .

ali x

Generali

StevieJ wrote: »

Not surprising as the recession will be caused by the credit crunch which has been bobbing along for 15 months now (with increasing ferocity).

That we're looking at a recession doesn't surprise me in the least. The speed at which the wheels have come off amazes me. It's possibly the most spectacular collapse since the Mississippi Company in the C18th.

epz_2

it might actually be rather amusing to see gordon win the next election.

imagine the Oh !!!!!! ive won moment when he realises its him rather than the torys that needs to cull thousands of government jobs and services mainly in labour heartlands.

Kez100

I don't want innocents to suffer - those who have saved or not borrowed up to the eyeballs - but I don't want massive borrowing just to make matters worse. Can't they just divert money to soften the blow for innocents if it happens - as an earlier poster said it won't happen to everyone.

neverdespairgirl

StevieJ wrote: »

I know that a lot of people are actually better off in a recession, I thought it was you lot that didn't know that. Why do you assume that everyone battens down the hatches when the logic is to take advantage of cheaper prices? Everyone doesn't lose their job.

No, but I bet a lot of people decide to be a bit careful.

There will be lots of people who won't lose work, but are alive to the possibility of it. So they might well decide on a cheaper holiday, put off the new kitchen, not go out to eat, spend a bit less at the pub, just in case.

Generali

neverdespairgirl wrote: »

No, but I bet a lot of people decide to be a bit careful.

There will be lots of people who won't lose work, but are alive to the possibility of it. So they might well decide on a cheaper holiday, put off the new kitchen, not go out to eat, spend a bit less at the pub, just in case.

That's what causes consumer spending to fall IMO in bad times. The bloke down the road loses his job so he has no money to spend. But then who cares, he's just some bloke.

But then you think that you might be next so you get your kid a cheaper bike for Christmas. Maybe leave a glass of British sherry out for Santa (poor chap). The small savings all add up. That's part of the philosophy behind this website and it's part of my political belief - economy is just the sum of millions of individual decisions and that's what makes markets incredibly powerful.

StevieJ

neverdespairgirl wrote: »

No, but I bet a lot of people decide to be a bit careful.

There will be lots of people who won't lose work, but are alive to the possibility of it. So they might well decide on a cheaper holiday, put off the new kitchen, not go out to eat, spend a bit less at the pub, just in case.

That is fine, but when they are slicing hundreds of pounds off consumers mortgage costs, I am not convinced it is going to work that way, In the last recession interest rates were actually rising.

Paul_N_4

StevieJ wrote: »

That is fine, but when they are slicing hundreds of pounds off consumers mortgage costs, I am not convinced it is going to work that way, In the last recession interest rates were actually rising.

During what period of time are you talking about here (when interest rates were rising)?

Generali

StevieJ wrote: »

In the last recession interest rates were actually rising.

And in the one before that too.

This is different from the last couple of recessions and IMO has more in common with the 1930s US/1990s Japan than anything from C20th UK.

That's not to say things will be as bad as those depressions but that is where we should be looking to see how transmission mechanisms will work and ways things could get really nasty (don't bail out banks and don't bring in protectionism seem to be the lessons we could learn potentially).