BOE say's Banking Crisis Easing

Thrugelmir

CLAPTON wrote: »

However, your suggestion of cuts right now will almost certainly lead to large increase in unemployment... .. how many more unemployed do you think is a price worth paying? Would your own unemployment for a few years be a price worth paying?

That is the choice we have.

So what's Labours masterplan to kickstart the economy? Private companies are shedding jobs every day. Yesterdays announcement at Corus being a prime example. Those plants will never reopen to produce steel. Headline 2,000 jobs. Reality 10,000 jobs. As the supply, service companies into Corus suffer. Local communities will be destroyed as people have no wages to spend.

Who is going to pay for the public service. The public debt is ballooning. Commonsense says its unsustainable. Yet we have a Government thats spinning investment!

Take off your RTG's. Forget your political beliefs and understand the real world as it is today.

StevieJ

With Clapton on this one, yes the UK had bubble, pretty much similar to the one generated under the Tories late 80's early 90's, but the real damage has been done by those US sub-prime loans wrapped up in CDO's and flogged to banks across the world, resulting in a catastrophic destruction of banks capital base. I am pretty sure the banks were not clear on how dangerous these were, so I don't see that Brownie would have had much chance. I do understand how this doesn't suit the Tory spin machine.

Thrugelmir

StevieJ wrote: »

With Clapton on this one, yes the UK had bubble, pretty much similar to the one generated under the Tories late 80's early 90's, but the real damage has been done by those US sub-prime loans wrapped up in CDO's and flogged to banks across the world, resulting in a catastrophic destruction of banks capital base. I am pretty sure the banks were not clear on how dangerous these were, so I don't see that Brownie would have had much chance. I do understand how this doesn't suit the Tory spin machine.

Um.... Northern Rock started securitising its loan book from the mid 90's. By the time it collapsed it had 20% of the UK mortgage market. Largest single share by any one lender.

The management blamed the collapse on the derailing of the wholesale markets in the USA. They regarded their business plan as prudent.

Where was the regulation? The Treasury was warned in 2004 that NR's lending was unsustainable.

This credit bubble is totally unrelated to anything else in history.

Why is Britain the most indebted Country in Europe on every level? Corporate, Mortgage, Credit Card. Government.......

purch

Why is Britain the most indebted Country in Europe on every level? Corporate, Mortgage, Credit Card. Government.......

........it must be those bl**dy CDO's

Thrugelmir

purch wrote: »

........it must be those bl**dy CDO's

of course its Maggies fault.......:cool:

CLAPTON

Is Britain the most indebted country is Europe?
Sometime debt is incurred to buy assets .... don't they count
would not debt minus assets be a better measure?


two men both owe 200k
one owns a 400k house
the other rents has no assets

are they in the same debt situation?
which would you prefer to be?

Graham_Devon

CLAPTON wrote: »

Is Britain the most indebted country is Europe?
Sometime debt is incurred to buy assets .... don't they count
would not debt minus assets be a better measure?


two men both owe 200k
one owns a 400k house
the other rents has no assets

are they in the same debt situation?
which would you prefer to be?

Those analogies and facts don't mix.

I don't know if were the most indebted. Some places tell us we are, some say not. All worked out on different things.

All I'm saying is, doing what your trying to do with those analogies makes no difference to the debt. It just makes it sound better.

Thrugelmir

CLAPTON wrote: »

Is Britain the most indebted country is Europe?
Sometime debt is incurred to buy assets .... don't they count
would not debt minus assets be a better measure?


two men both owe 200k
one owns a 400k house
the other rents has no assets

are they in the same debt situation?
which would you prefer to be?

FACTS ..............

In Britain we owe more on credit cards than the whole of Europe.
In Britain we owe more on mortgages than the whole of Europe.

What assets do we have to show for this debt as a nation?

Neither as the £400k house is not a liquid asset. Its real value is what it sells for. Would I want a £200k mortgage with 10% interest rates no thanks.

StevieJ

CLAPTON wrote: »

Is Britain the most indebted country is Europe?
Sometime debt is incurred to buy assets .... don't they count
would not debt minus assets be a better measure?

?

I am glad I had that big debt (minimal now), no rent for me when I retire unlike my German counterpart :beer:

CLAPTON

Virtually every significant company in Britain (and elsewhere ) is foundered in debt. Without it we would all still be hunter gathers.

Companies go into debt to buy assets so they can add value and make a profit.
To discount assets as somehow not being real is somewhat odd.