I am stupid, I don't understand Labour's energy price policy

C_Mababejive

Ed is talking ill advised BS in order to woo voters as if they were natives being thrown some shiny beads for gold.

Who knows more about energy supply? The energy infrastructure and procurement companies or Ed?

Will he also be seeking to control the price of new BMWs, flights to Florida or the price of bananas?

Energy is bought and sold on international markets these days just like the stock market. Ed cannot control international markets or indeed any market in a free market economy.

Thrugelmir

michaels wrote: »

But capitalist companies don't hang on to their profits they hand them out as dividends. The banks made a fortune in the years before the financial crisis but didn't have this money available to cover the losses.

If only it were that simple. Profit does not equate to cash. Companies also have to generate cash to repay debt, fund capital expenditure. As for the banks the biggest losses have come post the financial crash following the PPI scandal. All £25 billion of it. Which has actually helped to keep the UK economy ticking over. As it's impact subsides. Then the UK economy may not look so rosy.

wymondham

I don't think Labour understand Labours policies either, or much else I think....


Is it me or do all politicians seem to be even more disconnected from reality than they normally are this year?

tincans6

Thrugelmir wrote: »

If only it were that simple. Profit does not equate to cash. Companies also have to generate cash to repay debt, fund capital expenditure. As for the banks the biggest losses have come post the financial crash following the PPI scandal. All £25 billion of it. Which has actually helped to keep the UK economy ticking over. As it's impact subsides. Then the UK economy may not look so rosy.

On the other hand - perhaps post PPI provisions (Lloyds alone is close to £10bn) - perhaps the banks can start to look at paying dividends again.

Voyager2002

robmatic wrote: »

What kind of excessive profit margins have the energy companies been making? A percentage figure would be nice to know.

Good point, but it is not that simple. OFGEM has put caps on "profit" as declared in company accounts, so operating surpluses have been redirected towards growth, and of course salaries for top management. See the published research by Professor Catherine Marshall at the University of East Anglia for a full analysis.

Voyager2002

C_Mababejive wrote: »

Ed is talking ill advised BS in order to woo voters as if they were natives being thrown some shiny beads for gold.

Who knows more about energy supply? The energy infrastructure and procurement companies or Ed?

Will he also be seeking to control the price of new BMWs, flights to Florida or the price of bananas?

Energy is bought and sold on international markets these days just like the stock market. Ed cannot control international markets or indeed any market in a free market economy.

Politicians always simplify and distort complicated issues in order to 'communicate' with poorly-educated voters. If you happen to agree with the politician then this seems to be effective communication... personally I would use your opening words about the ways in which DC and Osborne describe the economy, but of course they are simplifying and I don't happen to agree with them.

I take issue with your final paragraph: the UK domestic energy "market" is administered by the companies involved, and the prices that consumers pay bear only a vague relationship to those arising from market forces.

Nikkster

tincans6 wrote: »

On the other hand - perhaps post PPI provisions (Lloyds alone is close to £10bn) - perhaps the banks can start to look at paying dividends again.

I've just had a text asking whether I pay a monthly fee for my bank account as I can 'claim all of the money back'...

princeofpounds

Will you introduce ISAs for dogs?

Saving is good. Dogs are good.

It's the only logical conclusion.

chewmylegoff

wymondham wrote: »

I don't think Labour understand Labours policies either, or much else I think....


Is it me or do all politicians seem to be even more disconnected from reality than they normally are this year?

They have probably accidentally let a few to many mentalists onto their focus group panels.

Thrugelmir

tincans6 wrote: »

On the other hand - perhaps post PPI provisions (Lloyds alone is close to £10bn) - perhaps the banks can start to look at paying dividends again.

That £10 billion primarily relates to HBOS. PPI provisions haven't finished yet.

Santander are tapping the markets for a £6 billion rights issue. Suggests that banks are struggling to keep pace with the increased level of capital adequacy that they are required to hold.