Madmen in Authority

LauraW10

tomstickland wrote: »

It's like a stuck record....cutting....double dip....we should be "investing"* instead...blah blah

*"investing" meaning spending loads of borrowed money.

I'm really pleased that the coalition government are getting on with sorting things out.

I hope it works out as you expect:) No sarcasm intended. BUT they are no actually doing anything are they? They are just scaring people.

mbga9pgf

LauraW10 wrote: »

I think your graph is telling me that the UK government borrowed a lot less than other governments, though I take yor point about debt in general;)

And who was in charge when we had the personal Debt boom? Who was in charge of the FSA at the time.

Recession since 2000 without the debt. Where is the economic miracle now, or does the emperor have no clothes?

Entertainer

LauraW10 wrote: »

I'm worried about the negative rhetoric which I believe is really damaging to consumer confidence and overseas investor confidence. I'm also worried that we are going to see massive cuts this autumn. I agree £6bn is a drop in the ocean and that doesn't concern me.

LauraW10 wrote: »

I know - I use it as example of how the Coalition rhetoric is being perceived. As I said earlier - given how this news is being covered if you work in the public sector would you have the confidence to buy a house, a car, go on holiday, a new pair of shoes. This sort of rhetoric is so damaging. The government should be "biggng up" Britain not making out we are a basket case.

But you could equally say the rhetoric about "starting early" on deficit reduction is making it clear to investors that we are serious about cutting the deficit thereby keeping interest rates down.

As I say, it's nothing, it wont make that much difference either way. After all, Alastair Darling took £12.5 billion out of the economy when he put Vat back up- that didn't spark a double dip.

And yes, I'm buying a house right now. I wouldn't be doing that if I thought a double dip recession/ crash was in the offing.

LauraW10

Entertainer wrote: »

But you could equally say the rhetoric about "starting early" on deficit reduction is making it clear to investors that we are serious about cutting the deficit thereby keeping interest rates down.

As I say, it's nothing, it wont make that much difference either way. After all, Alastair Darling took £12.5 billion out of the economy when he put Vat back up- that didn't spark a double dip.

And yes, I'm buying a house right now. I wouldn't be doing that if I thought a double dip recession/ crash was in the offing.

I don't think the £6bn will cause a double dip - I just think the knock on effects to confidence from the horrifying headlines might cause a fall in consumer spending, house prices, service sector etc.

Maybe they are trying to calm the bond market but there may be unintended consequences?

Just a thought, that's all - hope I'm wrong:o

Kohoutek

LauraW10 wrote: »

I think your graph is telling me that the UK government borrowed a lot less than other governments, though I take yor point about debt in general;)

Even looking at government debt alone is more complicated than just the percentage of debt to GDP. Although Japan's outstanding debt is enormous, they borrow very cheaply:

http://www.bloomberg.com/markets/rates/japan.html

They're paying only 1.24% on their 10 year bonds, and 2.07% on 30 year bonds. That's less than half that the UK pays on its equivalent bonds, and the UK is not paying a lot compared with medium sized and small European countries.

Any debt that's held by the central bank the government is effectively not paying interest on, because central banks almost always remit the interest they receive from the government back to the Treasury. In the UK, I think about 20% of outstanding debt is held by the BoE, so effectively 20% of our national debt is interest free. You wouldn't think that though given the deficit hysteria amongst the government....

mbga9pgf

http://news.sky.com/skynews/Home/Politics/Labours-Economic-Record-Attacked-By-Lord-Myners-Former-City-Minister-Slams-Flawed-Thinking/Article/201006215646027?lpos=Politics_First_Poilitics_Article_Teaser_Regi_0&lid=ARTICLE_15646027_Labours_Economic_Record_A

lostinrates

That chart is interesting. Doesn't India have a large public sector employment? what makes it affordable for them? If not where have I misunderstood that?

Emy1501

I suspect bond yields can move quickly. A few months ago Spain was paying less on its debt than we were and look where they are going now compared to us.

I have no doubt that gilt yields are where they are because the markets are happy with what the government is doing. Lets not forget Merv is happy with the cuts and the G20 are now starting to make the same noises as Osbourne has been making.

It seems that the Greek problem rattled people in the days before our election. David Miliband said not so long ago that one of the reasons the Lib/Lab coalition did not get anywhere off the ground was because the Lib Dems wanted to cut this year so seems like they had changed their minds after their meeting with the Tories and Merv.

Lord Myners comments tonights also seems to spell it out also. GB and AD thoughts now seem rather isolated whether they are proved right or wrong in the future.

davilown

mbga9pgf wrote: »

http://news.sky.com/skynews/Home/Politics/Labours-Economic-Record-Attacked-By-Lord-Myners-Former-City-Minister-Slams-Flawed-Thinking/Article/201006215646027?lpos=Politics_First_Poilitics_Article_Teaser_Regi_0&lid=ARTICLE_15646027_Labours_Economic_Record_A

I saw that on the news earlier - I have to say that labour 'lied' from the beginning of the recession about how much debt the country was in and how we would come out of it. That's not to say the current coalition is not now, however, the little note from the previous Treasury Sect to the incoming was enlightening.

IMO, if someone comes on to the debt free board they have to sort out a few things before people will advise them. One of these is a SOA. This is what the coalition is sorting out at the moment.
The next is what can be cut back to enable a payment of debt and which debt is the most expensive. Cut back the sky TV (or social spending), cutting the food bill by buying less and wasting less (cut the red tape that all the public sectors endure day by day).

Yes its only my opinion, but I don't care about the financial markets, if someone loses on the stocks they've got invested, or loses £X on a property. I know perhaps I should, but I, like many others on here, have cleared their debt and are saving for their own future.

Yes I'm being 'jack' but why should we not pay off the UK's debt as soon as possible? Bite the bullet, it'll be very hard for the first year but it will get better as time goes by. Perhaps then people will learn the value of the items they buy, and not just throw them out as they are last year's model.

I voted for change, here it comes but I just pray they take firm and assertive action to sort this mess out.

Could we not just sell Scotland on eBay to pay the debt off? We wouldn't have to worry about Aberdeen's house price rises then

lostinrates

davilown wrote: »

Yes I'm being 'jack' but why should we not pay off the UK's debt as soon as possible? Bite the bullet, it'll be very hard for the first year but it will get better as time goes by. Perhaps then people will learn the value of the items they buy, and not just throw them out as they are last year's model.

Its great you've paid your debt off. Some have just started their own phase of debt repayment. For them the double whammy of facing own need to restrict budget and then the need to deal with government stuff must be doubly daunting. I have to admit, I'm not looking forward to raised taxes etc as our mortgage payments start.