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Flatlining GDP is Our Fault
Comments
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Voyager2002 wrote: »Flatlining GDP is Our Fault
Indeed. Anyone who is aware of recent history will know that conservatives are not good at managing a modern economy. Since overall we voted for a party of incompetent economic managers to take command, we can hardly complain that the economy is failing.
By recent history. That includes 1997-2010?
When did a financial journalist by training have the expertise to run an entire economy?0 -
Long term savings have been in decline since 1980...property market..expansion of credit...stock market investment..gradual decline in interest rates...all have played a major part.
Theres been a massive change in peoples attitude to the use of their monthly income...which has been encouraged by all governments and business.
Millions don't save at all and most have less than a few thousand pounds to their name.Saving isn't across the board at all.
http://www.annuitysupermarket.com/blog/news/six-million-brits-without-any-savings0 -
GeorgeHowell wrote: »Why should the government -- acting on all our behalfs -- be expected to act imprudently and irrationally by spending more money that it doesn't have, when consumers are acting imprudently and irrationally by not spending money that they do have on things they want and thus perpetuating the very slump that is troubling them so much ?
What if they are saving for something specific?
What if the capital they do have is their source of income?"If you act like an illiterate man, your learning will never stop... Being uneducated, you have no fear of the future.".....
"big business is parasitic, like a mosquito, whereas I prefer the lighter touch, like that of a butterfly. "A butterfly can suck honey from the flower without damaging it," "Arunachalam Muruganantham0 -
where did all that money go? in boomers pockets, to be now spent on stanna stairlifts, extortionate waitrose shopping and having the heating up at 25 degrees 30 hours a day.
what a waste of my income; it should be getting pumped into the economy instead.
Locked in the property which is their home and always has been. They didn't jack up the market.
If they do downsize their will be a cost associated with that, solicitors fees, estate agent fees, removal fees, new furnishings, carpets, white goods, decorators etc all flowing back into the economy and 20% back to the chancellor.
Heaven forbid they may even gift some of their money to children or help pay for university costs etc.
I don't know any old people who lounge around in T shirts luxuriating in 25 degree tropical heat. They tend to have the thermostat on 19 degrees for short periods of the day, in the rooms they use. The rest of the time they wrap themselves up. That goes for whether they comfortable or struggling."If you act like an illiterate man, your learning will never stop... Being uneducated, you have no fear of the future.".....
"big business is parasitic, like a mosquito, whereas I prefer the lighter touch, like that of a butterfly. "A butterfly can suck honey from the flower without damaging it," "Arunachalam Muruganantham0 -
I wonder if there's a link between declining savings rates in the late '90s early '00s and an increase in banks like Northern Rock's reliance on money market funding?“I could see that, if not actually disgruntled, he was far from being gruntled.” - P.G. Wodehouse0
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It might be worthwhile pointing out that savings don't disappear into some black hole never to be seen again.
Savings equals investment as any fule no, and spending on investment is just as capable of providing employment etc etc as spending on consumption. Persuading people to spend more on consumption and save less might well lead to a temporary boost to GDP (which might well be what we need at the moment) but it's no way to run a modern economy. (See 1997-2010; the end result is painful.)0 -
Your graph doesn't seem to show that.
I was looking at the two distinct trends from 1950-2007...yes theres been a rebalance since as expected but not into double figures...10%.
Another factor to consider today is UK business isn't investing capital ...its simply storing it away or paying out special dividends..
Like many of the general public afraid to spend in uncertain times..
http://www.moneyobserver.com/news/12-10-23/cash-rich-companies-pay-out-record-dividends0 -
How will I build up a deposit for my first house if I buy a new iPhone and go on exotic holidays?grizzly1911 wrote: »What if they are saving for something specific?
What if the capital they do have is their source of income?Persuading people to spend more on consumption and save less might well lead to a temporary boost to GDP (which might well be what we need at the moment) but it's no way to run a modern economy. (See 1997-2010; the end result is painful.)Another factor to consider today is UK business isn't investing capital ...its simply storing it away or paying out special dividends..
Like many of the general public afraid to spend in uncertain times..
The answer is that you can't have it all ways. If consumers save instead of spending, for whatever reason, at a time of slump, then it will prolong the slump. If they do not see fit to blame themselves, then it's no good trying to blame anyone else either. If even half the additional 5% a year being saved over the immediate pre-crunch period was put back into spending it would make a huge difference.
Business confidence is in large part a reaction to consumer confidence. In large part the one will drive the other.No-one would remember the Good Samaritan if he'd only had good intentions. He had money as well.
The problem with socialism is that eventually you run out of other people's money.
Margaret Thatcher0 -
GeorgeHowell wrote: »...If even half the additional 5% a year being saved over the immediate pre-crunch period was put back into spending it would make a huge difference..
But spending on what?
You appear to be confusing 'spending' with 'consumption'. The two are not the same.0
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