Viking Supporters Co-operative
Viking Chat => Off Topic => Topic started by: mjdgreg on July 03, 2012, 12:42:50 pm
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Bob has resigned and is looking forward to a severance package of between £20M to £30M and an incredible final salary pension scheme. The world has gone mad. He should be thrown in jail instead. Gordon Brown and Ed Balls should hang their heads in shame at the pathetic regulation of the banks during the last Labour government. They should be thrown in jail as well.
If you have a Barclay's account, do the honourable thing and close it in protest and let them know why you've closed it. Don't just sit on your arse and let them get away with it. If you do, they'll just carry on in the same way. I would recommend the Nationwide as being one of the best out there.
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Bob has resigned and is looking forward to a severance package of between £20M to £30M and an incredible final salary pension scheme. The world has gone mad. He should be thrown in jail instead. Gordon Brown and Ed Balls should hang their heads in shame at the pathetic regulation of the banks during the last Labour government. They should be thrown in jail as well.
If you have a Barclay's account, do the honourable thing and close it in protest and let them know why you've closed it. Don't just sit on your arse and let them get away with it. If you do, they'll just carry on in the same way. I would recommend the Nationwide as being one of the best out there.
We`re now over 2 years into the present Dictatorship, but I see no signs of regulation from the present incumbents, in fact the PM has shy`d away from a full inquiry into the scandal, it makes you wonder if likeable Dave has any more skeletons in the cupboard, that he would n`t like to get out!
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If you have a Barclay's account, do the honourable thing and close it in protest and let them know why you've closed it. Don't just sit on your arse and let them get away with it. If you do, they'll just carry on in the same way. I would recommend the Nationwide as being one of the best out there.
Perhaps we should move our money to the other Banks who are already implicated OR as is almost bound to happen will be very shortly
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We`re now over 2 years into the welcome change of government, but I see no signs of regulation from the present incumbents, in fact the PM has shy`d away from a full inquiry into the scandal, it makes you wonder if likeable Dave has any more skeletons in the cupboard, that he would n`t like to get out!
I don't know how much quicker they could have started the ball rolling to clear up Labour's incompetence. You must do more research before you make inaccurate posts. Or maybe you should just stick to a maximum of 20 seconds.
Labour want a full inquiry that will cost a fortune (no change there then) and take forever so the issue can be kicked into the long grass. Far better that we have a brief inquiry that shows how useless Labour were in power while the issue is fresh in everyone's minds. Gordon Brown and Ed Balls watch out.
http://www.bbc.co.uk/news/10153578
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Perhaps we should move our money to the other Banks who are already implicated OR as is almost bound to happen will be very shortly
You sound very much like someone who is going to sit on their arse and do nothing. I've already mentioned Nationwide. There is also the Coop. There are others if you can be bothered to look.
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So how do you feel about the imminent departure of Brian Stock and possibly Coppinger Mick?
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So how do you feel about the imminent departure of Brian Stock and possibly Coppinger mjdgreg?
Not in the least bit surprised. I know for a fact that they both think Saunders is a complete joke.
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Really? And where do you get these facts from?
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Really? And where do you get these facts from?
I refuse to give up my sources. But trust me, I know what I'm on about. Rovers will definitely be relegated again next year unless they get rid of Saunders.
Saunders out!!!!
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Really? And where do you get these facts from?
I refuse to give up my sources. But trust me, I know what I'm on about. Rovers will definitely be relegated again next year unless they get rid of Saunders.
Saunders out!!!!
Your a gambling man Mick, give me some decent odds and I`ll take that bet!
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Your a gambling man mjdgreg, give me some decent odds and I`ll take that bet!
No point. Saunders will be gone before Xmas when the penny finally drops with the board.
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Really? And where do you get these facts from?
I refuse to give up my sources. But trust me, I know what I'm on about. Rovers will definitely be relegated again next year unless they get rid of Saunders.
Saunders out!!!!
I don't trust you. You don't have to reveal names, you could have said that you were talking to someone outside the ground who says that his mate was talking to Stock/Copps in the chippy or something. I may have reason to trust you then.
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I don't trust you. You don't have to reveal names, you could have said that you were talking to someone outside the ground who says that his mate was talking to Stock/Copps in the chippy or something. I may have reason to trust you then.
You should know that I am very pally with madmick50. If you check out all his previous posts you will see that everything he posted was incontrovertible fact and that all his predictions came to pass. So trust should not be an issue.
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OK Gollum. Or am I talking to Smeagol?
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Your a gambling man mjdgreg, give me some decent odds and I`ll take that bet!
No point. Saunders will be gone before Xmas when the penny finally drops with the board.
Surely there`s a point, is n`t a professional gambler in the game to make some money, by your reasoning this must be easy money for you, tempt me with some decent odds!
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All (http://www.drawingnow.com/image-files/mouth_icon.gif)
No (http://www.surplusandoutdoors.com/images/product/thumbnail/KNEE-TROUSERS-GTEX.gif)
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Surely there`s a point, is n`t a professional gambler in the game to make some money, by your reasoning this must be easy money for you, tempt me with some decent odds!
Being a professional gambler isn't as easy as you may think. I am a professional gambler not a bookie. As I explained earlier I can't do a bet with you as you think Rovers will stay up with Saunders in charge. I think Rovers will go down with Saunders in charge. However there is the distinct probability that Saunders will get sacked before the season ends and Rovers will stay up. This layer of complexity makes it impossible to offer you the bet you want.
Also I like to hedge my position if I change my mind about my original bet (I do get it wrong occasionally, hard to believe I know) or if it's going my way take an early profit before the bet has reached it's conclusion. This is called greening up. So I'm afraid the simple way you like to bet is not appealing to me and is the reason why bookies make huge profits. I like to make huge profits out of bookies, and not out of mug punters such as yourself.
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Surely there`s a point, is n`t a professional gambler in the game to make some money, by your reasoning this must be easy money for you, tempt me with some decent odds!
Being a professional gambler isn't as easy as you may think. I am a professional gambler not a bookie. As I explained earlier I can't do a bet with you as you think Rovers will stay up with Saunders in charge. I think Rovers will go down with Saunders in charge. However there is the distinct probability that Saunders will get sacked before the season ends and Rovers will stay up. This layer of complexity makes it impossible to offer you the bet you want.
Also I like to hedge my position if I change my mind about my original bet (I do get it wrong occasionally, hard to believe I know) or if it's going my way take an early profit before the bet has reached it's conclusion. This is called greening up. So I'm afraid the simple way you like to bet is not appealing to me and is the reason why bookies make huge profits. I like to make huge profits out of bookies, and not out of mug punters such as yourself.
But on this occasion wouldn't it be nice just to take a couple of quid off Filo and have the bragging rights and leave him with egg on his face.
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Just to set the record straight
We`re now over 2 years into the welcome change of government, but I see no signs of regulation from the present incumbents, in fact the PM has shy`d away from a full inquiry into the scandal, it makes you wonder if likeable Dave has any more skeletons in the cupboard, that he would n`t like to get out!
I don't know how much quicker they could have started the ball rolling to clear up Labour's incompetence. You must do more research before you make inaccurate posts. Or maybe you should just stick to a maximum of 20 seconds.
Labour want a full inquiry that will cost a fortune (no change there then) and take forever so the issue can be kicked into the long grass. Far better that we have a brief inquiry that shows how useless Labour were in power while the issue is fresh in everyone's minds. Gordon Brown and Ed Balls watch out.
Ah yes Mick. Research. You should try it some time before coming out with another one of your mono-maniacal diatribes.
Regulation of the banks. So Brown should have regulated more tightly. Of course, yes with hindsight. But there weren't many people criticising him for not regulating strongly enough back before the crash happened. Everyone is a f**king genius with hindsight, but there were no geniuses about 6 years back. Especially not on the Tory benches.
Take Cameron for example. He was utterly against regulations. Look what he said in a speech in 2006:
"Regulation ends up treating all companies the same whereas different businesses of different sizes, in different sectors, will have significantly different circumstances.
They should be encouraged to freely develop their own responses, tailored to their particular situation, rather than having specific measures imposed upon them.
In too many areas of life today, over-regulation is leading to the death of discretion, the replacement of trust with coercion."
http://www.guardian.co.uk/politics/2006/may/22/conservatives.davidcameron (http://www.guardian.co.uk/politics/2006/may/22/conservatives.davidcameron)
The Tories' own expert on banking, Andrew Tyrie who chairs the Select Committee that will be interviewing Diamond today was screaming back in 2000 that the FSA was a regulatory "Leviathan" that would strangle the City. If only eh?
http://www.andrewtyrie.com/upload/Leviathan%20at%20large.pdf (http://www.andrewtyrie.com/upload/Leviathan%20at%20large.pdf)
Here's some text from that paper to show what Tyrie's opinion on regulation was.
"It is all too easy for governments to encourage regulators to over-react. Governments cover their backs, but it is industry, the consumer and society as a whole who ultimately suffer. In financial regulation, as in so many fields, there is a tension between what is politically expedient and what is economically or morally appropriate."
"It is to be expected that major financial firms will be tempted to avoid the impact of an over-burdensome regulatory regime. If compliance costs become too high, large financial institutions can move, relatively easily, to a friendlier jurisdiction. "
He said that Brown's bill to set up the FSA was: "biased in the direction of over-regulation".
Politicians got it wrong. All of them. There should have been tighter regulation. But the ones in power right now are the ones who said that the regulation was TOO tight back then.
Go figure.
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Agree BST. Gideon would have a better argument if the current legislation he is putting through parliament contained such tightening legislation, but it doesn't. A Leveson style enquiry would embarrass all politicians, back to Thatcher who tore down the firewalls between retail and casino banking. Hindsight is a wonderful thing.
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It's simply not true that he wasn't being advised to impose tighter regulation. See below a highlighted section proving the point. Anyway the buck stops with the government of the day. I don't care what other politicians were saying. It's the politicians that were in power that should be held accountable for the massive mess we now find ourselves in. Step forward Gordon Brown. He overspent wildly, leaving future generations with an impossible bill to pay and he caused the banking crisis as I explain below.
Gordon Brown admitted in his last few weeks as Prime Minister that maybe, just maybe, Labour's 'light touch anything goes' approach to regulating the City might have been part of the almighty financial mess Britain now finds itself in. He had always previously insisted that his only failing as far as the banking crisis went was not pushing his own campaign for global reform of the financial system as strongly as he should have done. Unfortunately for him there isn't the slightest shred of evidence of a British reform agenda.
Anyone who searches for this reform agenda will instead find a whole series of quotes that trumpet the City. At the time these quotes were made the City was already careering dangerously out of control. Brown proclaimed the City as 'an outstanding British success story and a triumph in the application of enlightened, New Labour, public policy'.
He wanted to replicate what the City had achieved for the whole UK economy! Indirectly he has achieved this aspiration. The bankers have succeeded in busting the wider economy as effectively as their own organisations.
Who can forget his June 2007 Mansion House speech. With money markets already in meltdown, he hailed 'an era that history will record as the beginning of a new golden age for the City of London'. Even more embarrassingly, a year earlier he had harked back to the Enron scandal to say, 'and I will be honest with you, many who advised me, including not a few newspapers, favoured a regulatory crackdown. I believe we were right not to go down that road ... and we were right to build upon our light touch system….fair, proportionate and increasingly risk based'.
In 2005, he stated that the better model for financial regulation was 'not just a light touch, but a limited touch. We should not only apply the concept of risk to enforcement of regulation, but to…the decision as to whether to regulate at all'.
He now says 'The truth is that, globally and nationally, we should have been regulating them more'.
He then further compounded the problem by bailing out the failed banks. In any other business recklessness on such a scale would have resulted in them going bust. Then even worse, he introduced a zero interest policy which enabled the banks to earn profits and bonuses that matched the best years of the pre-crisis boom.
You couldn't make it up. Brown has proved himself to be a complete idiot who made mistake, after mistake, after mistake. We are all now living with the devastating consequences. He should be tried for treason and the death penalty should be brought back just for him. I will quite happily carry out the deed if necessary.
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Go on Mick. Follow through your research. Let us know who these people and newspapers were who wanted a harder crackdown.
I know exactly who they were. You go and do a bit of research and find out for yourself. Then come back on here and tell us.
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Go on mjdgreg. Follow through your research. Let us know who these people and newspapers were who wanted a harder crackdown.
I know exactly who they were. You go and do a bit of research and find out for yourself. Then come back on here and tell us.
Piss poor response to my devastating critique of Gordon. I know exactly who they were as well. I'm not going to bore the readers with this information because it is totally irrelevant to the debate. I would have thought that the words spoken of your hero would have been good enough for you.
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Forgive me for interrupting your one man back slapping Mick, but you have totally missed the point, as well as missed the opportunity to tell us who called it right on banking regulation.
Brown got it wrong. With hindsight that's obvious. The Tories thought he was too hard. They would have been even lighter which would have been still more disastrous.
The people calling for more regulation before the crisis were the old fashioned statist lefties my friend. THEY were the ones who called it right in terms of seeing where light touch would take us. I assume you are now agreeing with us Lefties then?
But that's all with hindsight. Brown was a real world politician in a real world situation. Had he gone for a harder regulatory approach 12 years ago, and the banks had upped sticks and left as they promised, our economy would have been f**ked.
Arguing from hindsight is the style of a poor intellect Mick. Arguing with hindsight and ignoring every aspect of the issue other than the one you personally want to make a point about is the style of a 5 year old.
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But that's all with hindsight. Brown was a real world politician in a real world situation. Had he gone for a harder regulatory approach 12 years ago, and the banks had upped sticks and left as they promised, our economy would have been f***ed.
Somewhat ironic then that the current Labour view does seem to be against bankers, I mean how often do you hear the line "cosying up to the bankers" when the Tories implement policies to keep them here?
To be frank it's simple for a lot of things in banking there needs to be light regulation, that's better for everyone, needless red tape is an utter nightmare. But certain things don't fall in that bracket. I'm still unsure whether rate fixing should be heavily regulated, certainly though you would think it flouts existing competition regulations. What surprises me though is that this happened firstly during the banking crisis a few years ago, but Ed Balls knows nothing of it..... It equally surprises me that Osbourne knew nothing of it. That doesn't bode well for two financial politicians who've supposedly looked at every angle, I would've thought it a first place to look as government have so often talked about getting banks lending at good rates (something the Labour side have been huge on), doesn't put anyone in a good light really.
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Forgive me for interrupting your one man back slapping Mick, but you have totally missed the point, as well as missed the opportunity to tell us who called it right on banking regulation.
Brown got it wrong. With hindsight that's obvious. The Tories thought he was too hard. They would have been even lighter which would have been still more disastrous.
The people calling for more regulation before the crisis were the old fashioned statist lefties my friend. THEY were the ones who called it right in terms of seeing where light touch would take us. I assume you are now agreeing with us Lefties then?
But that's all with hindsight. Brown was a real world politician in a real world situation. Had he gone for a harder regulatory approach 12 years ago, and the banks had upped sticks and left as they promised, our economy would have been f***ed.
Arguing from hindsight is the style of a poor intellect Mick. Arguing with hindsight and ignoring every aspect of the issue other than the one you personally want to make a point about is the style of a 5 year old.
Your leftie friends didn't call it right. You try and simplify things down to light touch and harder touch. Way to simplistic. Light or harder it doesn't matter if the way the regulatory authorities are set up is fundamentally flawed.
Shortly after moving to the Treasury Brown set up a tripartite system of regulation. The Bank of England was made responsible for managing inflation, the FSA was given responsibility for supervising financial markets and the Treasury was to design the overall structure of regulation.
This tripartite regulatory model broke so many of the most fundamental rules of management that its eventual failure was entirely predictable. This was pointed out by the Tories and many others at the time and not after the event with hindsight.
For a start the Bank of England was given the wrong target. It was told to monitor the Consumer Price Index rather than the Retail Price Index. The problem was that the CPI does not include housing costs, whereas the RPI does. So year after year the Bank could merrily report that inflation was bumping along around the 2 per cent target while, in fact, there was a massive, unsustainable bubble in house prices, which none of the regulators apparently noticed.
A second concern was that in a crisis you need a 'single line of command' - one person or body must have clear control and accountability. By spreading the responsibility between three quite different organisations in an unclear way, Brown was designing a three-legged camel.
However the most fundamental error Brown made was to give what was essentially a consumer services regulator, the FSA, responsibility for macroeconomic management. A truly monumental mistake that beggars belief (as was pointed out by many at the time).
The whole ethos, background and skill-set of the FSA was based on regulating the selling of financial products - pensions, savings, investments, unit trusts, mortgages and so on. Something they were piss poor at doing. They simply didn't have the knowledge or experience to be given overall responsibility for regulation of financial markets. Unbelievably inept decision.
So to summarise it's not a question of light or harder touch its more of a question of getting the right regulatory framework in place first. Something that Brown failed abysmally on and we are now living with the consequences.
Your comment 'Had he gone for a harder regulatory approach 12 years ago, and the banks had upped sticks and left as they promised, our economy would have been f***ed' made me piss my pants laughing. Don't you realise that this is exactly what has happened to our economy and your hero is to blame? You talk as if it's a good job he wasn't too hard on the banks or everything wouldn't be rosy in the garden like it is now. Just in case you haven't noticed there aren't any roses in the garden, there are only weeds.
These statements also had me rolling about on the floor laughing 'Arguing from hindsight is the style of a poor intellect mjdgreg. Arguing with hindsight and ignoring every aspect of the issue other than the one you personally want to make a point about is the style of a 5 year old'. This is exactly how you debate! I on the other hand offer up a perfectly reasoned well thought out, backed-up argument which has weighed up all the evidence and has come to a logical rational view of the situation.
You on the other hand just seem hell bent on defending your hero at all costs despite all the overwhelming evidence I produce to the contrary. However I do admire you for coming back for more. I'm amazed that you still have the stomach for the fight as once again I have totally bludgeoned you to defeat.
Hopefully some of your followers will point out to you on the quiet that you are trying to take on a far greater intellect and will always be battered to defeat. It's probably time now to retire gracelessly from the battle and send on the next challenger. You have had too many wounds inflicted on you now and I don't want to inflict any more as permanent loss of self esteem is going to be the likely outcome.
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Mick, Mick, Mick. You make it so difficult to argue with you. Not due to your intelligence, obviously, but due to your lack of logic.
Example:
1) You criticise Brown for not having regulated the banks correctly.
2) The only possible inference of this is that the regulation that WAS imposed gave the banks too much leeway to make erroneous decisions.
3) But you then say that the problem wasn't that the regulation was too hard or too soft, it was the way it was implemented.
4) But if it was implemented in a way that gave the banks too much leeway to make erroneous decisions, then by definition it was insufficiently severe.
So we're back to the hindsight issue. You (and many others) are saying (with hindsight) that the regulation was wrong. I agree. That much is obvious. What is not obvious is exactly who on the Right was saying that back in the early 2000s. The only criticism from the Right was that Brown was a control freak who was crucifying the banking sector with too severe a regulatory approach.
Hindsight. Every Tom Dick and Harry is a genius with hindsight. True genius is spotting the problem BEFORE it emerges. Point me to someone on the Right of politics who did that. Not Osborne. Not Cameron. Not Tyrie. Who? The one major politician to come out of this with credit is Cable who WAS prophesying trouble ahead. But then he was some way to the Left of much of New Labour.
Hindsight No.2. You criticise Brown for giving the BoE the wrong inflation target. That's a valid criticism. With hindsight. Who was flagging this up at the time that Brown took the utterly unprecedented decision of taking interest rate setting out of political control and giving it to the BoE? Point out the prophets to me Mick, cos I don't know who they were.
Your insistence on using hindsight is what second rate gobshites do. It's like standing in the 21st century, criticising Daimler and Benz for developing the internal combustion engine but not realising that people would get killed without ABS or get lost without SatNav. Bleeding obvious now, but not so obvious then.
And this isn't even your biggest failing. The biggest one is your continued insistence that the problems we have experienced were somehow unique and all Brown's fault. That America, Japan, Germany, France, Italy, Spain, Singapore etc, etc etc didn't also have horrific crashes in 2007-09.
Politicians are fallible. Every one. Brown made big errors. But I have seen no evidence, none at all that any alternative Chancellor would have done better. Not during the era when banks should have been better regulated. And unquestionably not when the crisis exploded.
But politicians make errors. Churchill made errors. he f**ked up colossally on Gallipoli and on the Gold Standard. But he is still arguable the finest Prime Minister we ever had. Nye Bevan f**ked up colossally on not screwing down doctors' conditions when he set up the NHS. But he still set up the NHS. What's the old saying? The man who never did anything wrong never did anything? And the man who whines and points the finger with hindsight has the attitude of a five year old who can't understand why the world is not perfect.
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Your insistence on using hindsight is what second rate gobshites do.
I assume you are talking about yourself because you are the only one that keeps on mentioning hindsight. The only defence of Brown you offer is that everyone makes mistakes so stop blaming him is laughable.
It's very simple. Brown controlled the purse strings and determined economic policy for 13 years of the Labour government. It doesn't matter whether other people were pointing things out at the time or not. He was in power. He must accept responsibility. The buck stops with him. End of.
He created a 3 legged camel that was nowhere near fit for purpose. He made mistake after mistake after mistake. A chimpanzee would not have performed so badly. The only thing he got right was to keep us out of the Euro, but most of the credit for that must go to Ed Balls. However this was not a difficult decision. On everything else he got it badly wrong. The man is the most incompetent politician in a generation and he has totally ruined the country. How anyone can defend him beggars belief.
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Part A
It's very simple. Brown controlled the purse strings and determined economic policy for 13 years of the Labour government. It doesn't matter whether other people were pointing things out at the time or not. He was in power. He must accept responsibility. The buck stops with him. End of.
Part B
The only thing he got right was to keep us out of the Euro, but most of the credit for that must go to Ed Balls.
Does your Part B not contradict Part A totally ?
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Does your Part B not contradict Part A totally ?
No not at all. The Euro decision was only one of many decisions he made. He got all the other ones wrong.
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Was he correct to take the responsibility for setting interest rates out of political control?
Simple yes/no will do.
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Was he correct to take the responsibility for setting interest rates out of political control?
Simple yes/no will do.
Unfortunately for you life is not that simple. For starters he gave responsibility for CPI instead of RPI knowing full well that politically it would be easier to hit the inflation target of 2%. It should have been RPI but this would have made life harder for him so he took the politically expedient way out.
He couldn't care less if the housing market went totally out of control because of this decision. Look at the mess that Spain are in now from a housing boom. We have yet to still fully suffer the consequences of our housing boom. But let's just assume that the CPI was the correct rate to track. Are you really naive enough to believe that the Bank of England set rates with no political influence? No chance. If you want proof of that look no further than the current Libor scandal involving Barclays. Brown and Balls are going to be fingered on that one very soon.
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Was he correct to take the responsibility for setting interest rates out of political control?
Simple yes/no will do.
YES
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I never knew there were so many letters in "yes" or "no" Mick
Simple enough question. Why confuse it with secondary ones?
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I never knew there were so many letters in "yes" or "no" Mick
Simple enough question. Why confuse it with secondary ones?
Your question is not valid that's why I can't say yes or no. He didn't take interest rates out of political control. Haven't you been watching the news about the Libor rate scandal? Whitehall (Brown and Balls etc) put pressure on the BoE to get Barclays to lower their rates artificially. What more proof do you want that the setting of interest rates was very much politically influenced? Are you really naive enough to think that the current very low base rate has had nothing to do with our political masters?
I don't believe you are that stupid. I think you are just clutching at straws to try and find something Brown got right and if that is your best effort then I rest my case. Game set and match.
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Mick
I believe the technical term for what you just wrote is "libel".
There is absolutely no evidence whatsoever that Brown or Balls were involved and frankly, I'd be staggered if they were. Gideon yesterday had to rapidly back track after making exactly the sort of unfounded allegations that you made. He looked a right bloody fool in doing so. As do you.
Regardless of that, Libor is not the same as BoE base rate. So I'll repeat the question. Was Brown correct to put setting of the base rate out of political control. Yes or no. Easy one word answer.
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Mick
I believe the technical term for what you just wrote is "libel".
There is absolutely no evidence whatsoever that Brown or Balls were involved and frankly, I'd be staggered if they were. Gideon yesterday had to rapidly back track after making exactly the sort of unfounded allegations that you made. He looked a right bloody fool in doing so. As do you.
Regardless of that, Libor is not the same as BoE base rate. So I'll repeat the question. Was Brown correct to put setting of the base rate out of political control. Yes or no. Easy one word answer.
Sorry but yet again I will venture "YES" and he was right to keep "us" out of the Euro.
Magnificent vision by GB
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mjdgreg
I believe the technical term for what you just wrote is "libel".
There is absolutely no evidence whatsoever that Brown or Balls were involved and frankly, I'd be staggered if they were. Gideon yesterday had to rapidly back track after making exactly the sort of unfounded allegations that you made. He looked a right bloody fool in doing so. As do you.
Regardless of that, Libor is not the same as BoE base rate. So I'll repeat the question. Was Brown correct to put setting of the base rate out of political control. Yes or no. Easy one word answer.
I've come to the conclusion that you are both naive and stupid. What I say is not libel it is fact. Somehow I don't think I'm going to be sued any time soon. I believe the technical term for what you write is 'load of b*llocks'. There is plenty of evidence that Brown and Balls were involved and it will all come out over the next few months. You really show your naivety by saying you would be staggered if they were.
You obviously haven't read what Osbourne said in his article. Balls twisted his words. All Osbourne said was that that Labour aides had been ''clearly involved” in the Libor interest rate scandal. The Chancellor was not, in fact, referring directly to Balls. Balls assumed he was referring to him. I wonder why that was. I'll let those of you out there with half a brain work that one out for yourselves.
We all know that Libor is not the same as BoE base rate. What we also know is that Labour aides used political influence with the so-called independent BoE to put pressure on Barclays to lower their rates. It is naive in the extreme to think that Labour aides wouldn't also use political influence with the BoE to affect the base rate. No way a control freak like Brown would let the BoE be fully independent. So I repeat, your question is not valid as it is built on a false premise.
However I'm in a good mood so I am going to humour you. I'm going to pretend for a short while that I inhabit the same parallel universe that you do. I'm going to assume that the BoE was given control of interest rates without political influence and make the case as to why this was yet another bad decision.
Giving the BoE full control of interest rates led to monetary policy being too relaxed in the run up to the financial crash. Also in the past 2 years, the MPC has forgotten completely about its inflation mandate. Interest rates have been held at extremely low rates even while inflation climbed above 4%. Nobody at the BoE seems to be aware that credibility is the main tool for keeping prices under control and they have lost that, making them very ineffective in dealing with our financial problems.
Far better that the BoE had never been made independent and in May 2010 Osborne had been put in charge of interest rates. He'd have been in charge of a coalition with no plans to hold an election until 2015. He'd have known that he had to cut the deficit on a huge scale and that there was an impending inflation problem. He could have put up interest rates gently early on in the coalition's term of office. That would have stopped inflation rising and with any luck get it back onto its 2% target.
By 2013, the economy would have be through the worst and would have started growing again. The deficit would have been down to manageable levels and taxes could have been cut. With inflation nipped in the bud, interest rates could have been cut as well. Through 2014 people would have been paying less tax and their mortgage would be lower as well. The feel-good factor would be back – just in time for the election. There would be no danger of Labour getting back in.
Inflation is like a disease. The earlier it is treated it the better. The BoE is leaving raising rates far too late and will probably have to raise them sharply in 2013 or 2014 with devastating effects on the economy. The longer and harder you look at the evidence, it becomes obvious that handing over control of monetary policy to the BoE has been an abject failure. It would have been far better leaving interest rates under the control of the chancellor.
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Let me get this straight Mick, cos it's late and I'm tired.
1) There's loads of evidence that Brown and Balls manipulated Libor. But none of it has come out yet? So where is it then if you are so certain that it exists? In your back pocket?
2) Brown was a control freak who would never have left the BoE in charge of interest rate policy. But he blundered massively in putting the BoE in charge of interest rate policy and it was that decision that led to the financial crash? (PS: A crash that also happened in Nevada, Ontario, Honshu, Andalucia, Basilicata, Saxony, Gascoigne and Flanders? f**k me but Brown really WAS a control freak wasn't he?)
You've done me a service Mick and I'm very grateful. From tomorrow, I will no longer bray my 5 year old for his regular petulant and logically incoherent outbursts. If you are an exemplar of what adulthood is all about, his consistency would already knock you into a cocked hat.
And that's all before we get onto your childlike misunderstanding of the root of the current macro-economic problems, and your utter ignorance of the classic Keynesian solution to the Depression that we are in.
Raising interest rates? While the economy is already flat-lining? f**king hell, even the Hell fire and damnation right wing Krauts in charge of the ECB haven't pulled that one. And nor has any other central bank. Because it would be the one policy guaranteed to turn our mini-Depression into a full on 1930s catastrophe.
What you are saying is the equivalent of a back seat driver at a level crossing, worrying about a potential crash somewhere down the line if you drive too fast and shouting BRAKE!!! whilst ignoring the train coming along.
You go on believing your own little theories Mick. Fortunately, you have grown ups on charge to save you from your own bizarre ideas.
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1) There's loads of evidence that Brown and Balls manipulated Libor. But none of it has come out yet? So where is it then if you are so certain that it exists? In your back pocket?
Some of it has already come out. Have you missed Paul Tucker's dealings with Barclays? Labour are currently doing their best to hide it, but it will come out over the next few months.
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2) Brown was a control freak who would never have left the BoE in charge of interest rate policy. But he blundered massively in putting the BoE in charge of interest rate policy and it was that decision that led to the financial crash? (PS: A crash that also happened in Nevada, Ontario, Honshu, Andalucia, Basilicata, Saxony, Gascoigne and Flanders? f*** me but Brown really WAS a control freak wasn't he?)
You're the one that said he was a control freak (I don't disagree). He would never have left the BoE FULLY in charge of interest rates without sticking his oar in. You missed out the word FULLY. He did blunder massively but I never said it led to the worldwide financial crash. However it did contribute to it and left us in a far worse position to cope with it (along with all the other mistakes Brown made).
Here is some more evidence that the BoE is not free of political influence when deciding interest rates. Although the BoE is supposedly independent, Parliament reviews the bank’s accounts and annual report because its policies affect the public. Additionally, it has a close relationship with the Treasury, whose Treasury Committee conducts regular hearings on inflation with members of the Bank’s Monetary Policy Committee. Also, the government sets the unemployment and growth objectives as well as an inflation target for the economy (currently 2%), which the bank attempts to meet. If the actual inflation rate is 1% (or more) off target, then the Governor of the bank must submit an explanation to the Chancellor of the Exchequer.
The bank’s primary objective is to achieve monetary stability. The MPC has nine members and consists of the Governor, two Deputy Governors, two executive directors of the bank and four appointees by the Chancellor of the Exchequer. The Governor and the Deputy Governors are all appointed by the Crown to a term of five years, although the Chancellor wields a strong influence over the selections.
There you have it. The BoE is independent in name only. There is masses of political influence as described above. I didn't even mention the MBE's and perks like elevation to the House of Lords that are used as carrots to get the BoE to be good boys for the Chancellor.
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You've done me a service Mick and I'm very grateful. From tomorrow, I will no longer bray my 5 year old for his regular petulant and logically incoherent outbursts. If you are an exemplar of what adulthood is all about, his consistency would already knock you into a cocked hat.
I feel sorry for your son. No doubt you are turning him into a future leftie with all your brainwashing and braying which will be stifling independent thought in him. My son on the other hand has been shown both sides of the argument and is now an avowed right winger like myself. Job well done as a father.
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And that's all before we get onto your childlike misunderstanding of the root of the current macro-economic problems, and your utter ignorance of the classic Keynesian solution to the Depression that we are in.
You need to ask yourself the question 'why are we in this financial mess if spending is the solution? Gordon Brown spent like a drunken sailor and the coalition are still spending like crazy and things are getting worse not better. Your logic is totally flawed.
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Raising interest rates? While the economy is already flat-lining? f***ing hell, even the Hell fire and damnation right wing Krauts in charge of the ECB haven't pulled that one. And nor has any other central bank. Because it would be the one policy guaranteed to turn our mini-Depression into a full on 1930s catastrophe.
Far better to raise interest rates early to get inflation under control than to let the problem drag on indefinitely. When interest rates do eventually rise (which they will) a lot more damage will be done than if we'd bitten the bullet earlier. Not raising rates has been a great success so far hasn't it. All it's doing is prolonging the agony and making the patient more ill as time goes on.
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What you are saying is the equivalent of a back seat driver at a level crossing, worrying about a potential crash somewhere down the line if you drive too fast and shouting BRAKE!!! whilst ignoring the train coming along.
You go on believing your own little theories Mick. Fortunately, you have grown ups on charge to save you from your own bizarre ideas.
What you ignore is the already massive debt burden we already have. To want to increase it further is utter madness. I'm glad I don't live in silly Billy land with you and all your leftie friends.
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http://www.youtube.com/watch?v=sL5mAbwUYpM&feature=related
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Mick.
Going into WWII we had a historically high debt burden. We borrowed like mad to pay for the war because we had no option. We then brought that debt burden down over 30 years after the war.
That is PRECISELY what we have to do now. Hold our nerve. Keep Govt spending up. Get the economy back working. And THEN address the debt burden.
If we don't get the economy going (and there is not a single example in history of a mature economy getting out of Depression by cutting Govt spending - not one) then we will NEVER reduce our debt. Not possible.
We're back to where we were 2 months ago. You spouting the none sense that f**ked up Japan 20 years back. Me asking you to explain why the same medicine here wouldn't also f**k up our chances. You ignoring the question.
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Banging on about the years after the war and Japan 20 years ago is not relevant to today's circumstances. The financial world has completely changed since then.
Question for you. Do you still think that Gordon Brown made the BoE independent and free of political influence? A simple yes or no will do.
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Mick. Pig ignorance dressed up as wisdom is still pig ignorance. As you remind us four or five times a day.
The changes in the financial sector have nothing to do with the basic mechanics if how macroeconomics works. You might as well say that, because we invented rockets, we can ignore Newton's Laws of Mechanics. The basic mechanisms apply regardless of the detail of how they are applied. You betray your ignorance by suggesting that inflation is the problem in the current recession, when nothing could be further from the truth. You betray your ignorance still further by suggesting that (because if some unspecified) changes in financial institutions) the basic economic rules (relating to how lack of aggregate demand causes deep recessions and how the only way that this has EVER been remedied is increased Govt spending) some how don't apply.
The list of Mickonomics that we are waiting for simple answers to is getting longer by the post. It currently stands at this:
1) Name a single mature western-style economy in history that had got out of a lack-of-demand style recession by cutting back Govt spending.
Answer: None
2) Explain the mechanics of how increasing interest rates would get us out of the current recession:
Answer: None
3) Explain the mechanics of why the well-established Keynesian lessons of what causes demand-slump recessions, and how to get out of them, no longer apply.
Answer: because the financial sector has changed. In what way Mick? And how have those changes changed the basic rules.
Those are three assertions that you have made and not substantiated.
We're waiting.
Meantime, you return a question to me that wasn't the one I posited. Gordon Brown didn't "make the BoE independent". More ignorant guff Mick. A cursory look at the BoE's own website sees it describing itself as "A public body, wholly owned by Govt, with a significant public policy role and accountable to Parliament."
What Brown did was to pass the responsibility for monetary policy (in particular, setting base rate) to the BoE.
Of course there is linkage between the BoE and Treasury. They have to work closely together to synchronise monetary and fiscal policy. The point was that Brown, for the first time in history, passed responsibility for monetary policy to the BoE. More specifically, the responsibility was passed to the nine-person strong Monetary Policy Committee, comprising bankers, central bank staff and leading financial academics. The aim being to have a detailed, apolitical debate on the economic effects of changing interest rates, rather than have political concerns (such as popularity at elections) deciding policy.
That was a far sighted and correct decision, because at a stroke it did away with generations of Chancellors setting interest rates for political reasons. The two most egregious examples were Tory Chancellors Lawson and Barber in the mid 80s and mid 70s who both, in the run up to Elections, kept interest rates way below what they should have been, fostered colossal booms and led to 15-20% inflation, huge internally driven recessions and tripling of unemployment.
So: There's an answer for you. I await the three that are outstanding from you.
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Do me a favour and start answering some of my questions for a change instead of ignoring them and asking me the same old questions over and over again. Ones which I've already answered. I won't comment on your last answer about the BoE as in a previous post I think I proved conclusively that the BoE is far from independent so I'm not going to go over old ground. You think they are fully independent, I don't. We'll have to disagree on that one and let the readers make up their own minds.
Right back to another one of my ignored questions. I'll re-phrase it.
How did unemployment start rising under Labour before the crash despite them spending vast amounts of money that we hadn't got? By your logic if the Government spends vast amounts of money the economy will grow and unemployment will fall not rise. Why did the opposite happen?
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Mick.
You have not answered a single question. You duck, dive, evade, dissimulate, dissemble, change the topic. You should be a politician -and I don't mean that as a compliment.
You don't even read my answers. I stated categorically that the BoE is NOT an independent body. But it has had powers to decide interest rates devolved to it, and can act in an independent manner on that issue. You disagree? demonstrate it with facts. Not you "proving" something by stating and re-stating an opinion. Show us the evidence. That is how grown-up discussion progresses. You have as much time as you wish. we're all waiting. I suspect, as ever, we'll be waiting a while...
In the meantime, I'll continue answering your questions.
Unemployment ALWAYS rises in a recession. The question is, how far do the authorities let it rise?
As the recession of 07-09 kicked in, unemployment rose from ~5.5% in early 08 to ~8% in early 09. It was from early 09 that Brown's Government started the classic Keynesian counter-cyclical fiscal stimulus. Remember those dates for a moment, because we're going to take a historical detour.
The last time we had a recession remotely as severe as this one was in 80-81. In 1979, when Thatcher came to power (with the brilliant dole queue posters "Labour isn't Working"), unemployment was about 5%. In 1980, the recession kicked in. Thatcher's Govt increased interest rates and reduced Govt spending. Unemployment went up and up and up and up. By early 1984, it was 12%. One on 8 on the dole. It stayed above 10% until 1988. It didn't come down to 5% again until 2003.
THAT is what happens when you reduce Govt spending and put up interest rates in the teeth of a vicious recession. Any bloody fool knows that (apart from the bloody fool that I'm answering, clearly...) End of history lesson.
Now. Back to 2009. When Brown's Govt implemented the fiscal stimulus, guess what happened to unemployment Mick. It stabilised. It stayed around 8%. Despite a horrific contraction in the private sector, unemployment stabilised. In simple terms (because I know you are a simple man) the action that Brown took in 2009 means that around 1million people have stayed in work who would have been on the dole if the policies that Thatcher implemented in 1980, and that YOU want to implement now had been used. Had the fiscal stimulus not been whipped away by Gideon in 2010 (with the consequence that GDP flat-lined for 18 months before collapsing this year) then unemployment would have come down by now. Instead, it has gone up. Genius.
Now. Waiting for YOUR answers.
EDIT:
By the way. You want evidence that the BoE acted independently in setting interest rates? Political sway over rate policy would always lead to them coming down in the run-up to an Election.
That was what Chancellors ALWAYS did when they had control over interest rates. In the run up to the Feb 74, Oct 74, 1983, 1987, 1992 and 1997 elections, interest rates fell substantially. Funny that, wasn't it?
Then, in 1997, Brown put the BoE in charge of setting interest rates.
In the 12 months before the 2001 Election, the BoE put rates up from 5% to 6%. In the 12 months before the 2005 Election, the BoE put rates up from 3.75% to 4.75%.
If Brown was manipulating the BoE over interest rates for political ends, he did a f**king poor job of it.
You have evidence to the contrary? Come and tell us. We're waiting.
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At the beginning of 1993 unemployment was just over 3.0M. It fell to around 1.5M by 2001. The Tories were in power until 1997 and managed to get unemployment down by keeping tight control on public spending amongst other strategies. Labour when it came to power stuck to the Tory spending plans until 2000.
It is interesting to note that unemployment stopped falling broadly speaking around about the time Gordon Brown took out the cheque book and credit cards. He went on an unprecedented spending splurge increasing public spending by 80% during his time in office. This was one hell of a fiscal stimulus but guess what, unemployment stopped falling. It stayed at around the 1.5M mark until 2005 when guess what, it started rising.
Now, you seem to be saying that increased government spending reduces unemployment which means more people spend money and the economy flourishes. Looking at unemployment during the period I mentioned your logic seems totally flawed. Unemployment fell when tight control was kept on the purse strings and stayed the same and then rose once Gordon started splashing the cash. And he splashed a lot of cash. For those of you with a short memory there wasn't a recession in 2005. It started in 2007. So for 2 years unemployment was rising despite the country not suffering from a recession and despite Gordon spending like a drunken sailor.
Billy would have us all believe that unemployment only started rising when the coalition came to power. Patently not true. He would have us all believe that increased government spending would get unemployment down. Not true. The opposite is the case. He claims that Labour introduced a big fiscal stimulus to get us out of recession and bring down unemployment and that the Tories have ditched this plan. Not true. The government since it came to power has only cut public spending by 0.8%. Pretty much the same result as if Labour had won the election and introduced their deficit reduction strategy. Even Labour said the deficit needed reducing but not silly Billy (even though he has said that it does on another thread). Billy wants us to spend even more money totally contradicting himself.
To summarise it can be seen from the evidence I have produced above that unemployment falls when tight control of public finances takes place. It stops falling and begins to rise as soon as the cheque book and credit cards are taken out. Spending even more money is only going to make things worse.
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Mick.
You have just excelled yourself. I didn't think it was possible for you to fit in quite so many deviations, mis-understandings and half-truths into one post, but you managed it. well done.
Where to start?
1) Unemployment came down from the mid 1990s. Yes. Because the Tories, finally, had jettisoned the mad Thatcherite experiment and finally had a Chancellor in Ken Clarke, who understood Keynesian macro-economics. Go and have a look at what happened to CAUSE that fall in unemployment. Clarke let go of the Govt purse-strings. He increased Govt debt to GDP by half between 1992 and 1997. He also kept interest rates down. Classic Keynesian approach. Result - unemployment fell sharply and GDP grew.
2) Economists broadly agree that each economy has a natural rate of unemployment, below which it is impossible to go without driving up inflation. NAIRU - Non-Acceleration Inflation Rate of Unemployment. By 2001, we were pretty much at that position in the UK. It was not possible (or economically sensible) to drive unemployment down any further. The trick then was to keep it stable, by a dual policy of interest rate management, and small Govt stimuli. That is EXACTLY what happened.
3) Yes, Brown increased Govt spending, but to call it "spending like a drunken sailor" is plain silly. You quote the fact that he increased Govt spending by £1trillion over ten years. What you DON'T quote is that fact that total UK output increased by around £5trillion over that same period. Context Mick. It's vital. If I increase my spending on repair work to the house by £1000 per year, without increasing my income, it is madness. But if my income is increasing by £2000 per year, that is sensible and prudent investment in my infrastructure. Quote the whole picture and not selectively chosen factoids.
4) I'll repeat. When the recession exploded and unemployment rose above NAIRU, Brown did the correct thing of kicking in the big fiscal stimulus. It worked and would have continued to work had Gideon not pulled it.
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Billy.
You have just excelled yourself. I didn't think it was possible for you to fit in quite so many deviations, mis-understandings and half-truths into one post, but you managed it. well done.
Where to start?
1) Unemployment came down from the early 1990s. Yes. Because the Tories, finally, gained control of the public finances after taking over a basket-case of an economy from Labour yet again. Go and have a look at what happened to CAUSE that fall in unemployment. Clarke managed the economy sensibly. Result - unemployment fell sharply and GDP grew.
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2) Leftie economists broadly agree that each economy has a natural rate of unemployment, below which it is impossible to go without driving up inflation. NAIRU - Non-Acceleration Inflation Rate of Unemployment. By 2001, we were pretty much at that position in the UK. It was possible and economically sensible to drive unemployment down further. The trick then was to keep it falling, by a dual policy of interest rate management, and small Govt stimuli. Unfortunately the OPPOSITE happened.
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3) Yes, Brown increased Govt spending, and to call it "spending like a drunken sailor" is right on the mark. You quote the fact that he increased Govt spending by over £1trillion over ten years. What you also quote is the fact that total UK output increased by around £5trillion over that same period. What you DON'T quote is that much of this was fuelled by borrowed money and consumption. Context Billy. It's vital. If I increase my spending on repair work to the house by £1000 per year, without increasing my income, it is madness. But if my loans are increasing by £2000 per year, that is still madness and not a prudent investment in my infrastructure. Quote the whole picture and not selectively chosen factoids.
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4) I'll repeat. When the recession exploded and unemployment rose above NAIRU, Brown made the mistake of spending even more money by kicking in the big fiscal stimulus. It didn't work and has continued not to work. George Osbourne has only reduced public spending by 0.8% so hasn't pulled it.
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Here's the true story of the Labour years in government and an explanation why we're all doomed if they ever get back into power.
During the 1980s, we underwent painful but life-saving economic surgery. Britain was the sick man of Europe, stuck in a set of failing economic policies – especially ever-bigger government and higher taxes thanks to Labour. We have a lot to thank Margaret Thatcher for. She turned things around.
Unfortunately Labour came to power in 1997 and ruined much of Margaret's good work. Labour, under cover of much vacuous pro-market economy rhetoric, changed course and opted instead for the failed high tax-and-spend model. When Brown became Chancellor of the Exchequer in 1997, he presided over the fastest, most sustained expansion in government spending and intervention since the Second World War.
The British public sector grew to over 50% of GDP. He introduced a creeping re-socialisation of Britain which is the most important (and misunderstood) economic and social story of the Labour years in government. This stands in stark contrast to the fake pro-enterprise narrative spun by Brown. It is the great con of our time, doing untold damage to the British economy.
Perhaps the most stunning socio-economic revolution of the Brown years was the huge growth in the number of people who depended for their jobs, incomes, status and lifestyles on the government. This process risked turning Britain into a permanent state of socialist-style dependency. The growth of Brown’s client-state was truly phenomenal.
Around 30m of Britain’s 60m population are in paid jobs. Under Brown, when using the Labour Force Survey, which measures state employment by asking workers whether they are in the public or private sectors, the result was that over 7m people worked for the government. One-in-four of the workforce. Labour constantly boasted that 2m new jobs had been created since it came to power, but almost half were in the public sector.
Under Labour, government was the biggest growth sector of the British economy. Jobs in public administration, health and education, for example, went up by 30% since 1997. When the state employs at least one-in-four workers there is much evidence from social democratic Europe, to suggest that market-led reforms to create a more dynamic economy become virtually impossible.
Those who work for the state (and their families) become an influential and articulate voice in favour of tax-and-spend and are powerful enough to block reforms based on smaller government and lower taxes. This burgeoning constituency against reform becomes even more formidable when you include those on the welfare state’s payroll.
Towards the end of Labour's term in office over 11.7m people claimed a state pension, 2.7m were on incapacity benefits, 400,000 on other sickness or disability-related schemes, 816,000 on the jobseekers’ allowance and 761,000 were lone parents not in work and dependent on the state (another 191,000 were not in work but claiming various other benefits).
The bottom line is this. A staggering 23m people were either working for the state or were dependent on it for their incomes – 52% of the British electorate of 44m voters. Yet even that total does not include those on tax credits, subsidised farmers and other groups partly or wholly dependent on government largesse. According to a recent household resources survey, 69% of households are now on some kind of welfare benefits. At least 44% of the electorate are either employed by the state or dependent on state benefits for all or most of their income. This sad state of affairs is entirely the consequence of Labour’s cowardly failure to reform welfare and Mr Brown’s public-sector spending spree, which has fuelled higher state salaries and more state jobs.
British public sector workers are now better paid than their counterparts in the private sector, enjoy better pensions and work fewer hours. So they have good reason to be grateful to Labour. They repay it by voting for it. Welcome to the great buy-up of the British electorate. Many of Labour’s safe seats are now as socialised as the old Soviet states of Eastern Europe. Of the 200 constituencies where public sector employment is highest, just 20% are held by the Conservatives and 70% by Labour. By contrast, in the 200 seats where the private sector employs most people, 50% are Conservative.
Parts of Britain are now almost wholly dependent on the state. In some areas where old-fashioned manufacturing or mining has long since died out, government has taken its place, leaving ghettos of dependency where there is no room for the market economy to breath. Such places will be forever dependent on wealth being generated in those parts of Britain (largely London and the south-east) which are not yet socialised. No wonder they are staunch supporters of Labour's ever-expanding state.
Britain was in the grip of a vicious feedback loop. The more tax-and-spend Labour did, the more the number of those dependent on government went up and the harder it was to reverse course and the faster the British economy and society was declining. Slowly but surely, Britain was becoming trapped in a social-democratic dependency culture. It has almost got to the point that reversing is becoming impossible because those with a vested interest in bigger government and higher taxes have become too powerful to overcome.
Unless Osbourne starts to make significant tax cuts the re-socialisation of the British economy would seem to be a done deal.
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2) Leftie economists broadly agree that each economy has a natural rate of unemployment, below which it is impossible to go without driving up inflation. NAIRU - Non-Acceleration Inflation Rate of Unemployment. By 2001, we were pretty much at that position in the UK. It was possible and economically sensible to drive unemployment down further. The trick then was to keep it falling, by a dual policy of interest rate management, and small Govt stimuli. Unfortunately the OPPOSITE happened.
Mick. Do you go out of your way to make yourself look stupid and ignorant? You cannot manage to do it with such aplomb by accident, surely.
For the record, one of the developers of the concept of NAIRU wax Milton Friedman. You reckon he was a lefty economist?
You remind me of that Goodness Gracious Me character who said "Indian" everytime something successful was put forward. "Neil Armstrong. Indian astronaut."
With you, every time something is suggested that points out your lack of understanding or sheer stupidity, it is the work of lefties. "Milton Friedman. Lefty economist."
And cutting and pasting large works of polemic does not an answer make. Not does it answer any of the questions we've been waiting days and weeks to hear your answers on Mick. But we're patient. I suspect we'll need to be.
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Billy. Do you go out of your way to make yourself look stupid and ignorant? You cannot manage to do it with such aplomb by accident, surely.
For the record, one of the developers of the concept of NAIRU wax Milton Friedman.
Interesting that you start going on about unemployment and inflation. It wasn't that long ago that you were berating me for mentioning inflation. If you think it is acceptable for us to have 1.5m out of work then I don't care who the economists are that come up with this view. Lefties or right wingers they are plain wrong.
It's only a few decades ago that having 1m out of work was seen as a national disgrace. You need to come into the real world and stop using the arguments and theories of economists, many of which have had their heads stuck in books all their lives and have no experience of the real world of work. You strike me as this sort of person as well.
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I stated categorically that the BoE is NOT an independent body. But it has had powers to decide interest rates devolved to it, and can act in an independent manner on that issue.
We're changing it to 'can' act now are we. Having read my post about how much political influence there is over interest rates at least you have given some ground.
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There we have it then. Mickonomics is the way forward. John Maynard Keynes was wrong. Milton Friedman was wrong. That's the two 20th century giants whose economic theories have been applied throughout the capitalist world for 65 years comprehensively demolished.
I salute you Mick. Your combination of unsubstantiated opinion and copying/pasting from websites has set the terms of the discussion for economic practice in the developed world. Your Nobel Prize awaits.
As someone who simply wasted his time with text books and learning about fundamentals, I will from now take your approach and simply state that the world's experts, whose theories have been tested and checked by years of hard work and effort are wrong. Thank you for pointing out my errors. It's been a useful experience.
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"Can" as in "is free or able to". "Is at liberty to". "Has the capability and authority to".
Or have I misunderstood. Do you have your own personal definitions of the meanings of words that run counter to the ones that the rest of the world employs? Just like you have your own concepts of economics that the rest of the world doesn't understand.
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John Maynard Keynes was wrong. Milton Friedman was wrong. That's the two 20th century giants whose economic theories have been applied throughout the capitalist world for 65 years comprehensively demolished.
At last you've seen the light and realised that these economists were both cranks.
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I'm still waiting for an answer. Why did unemployment start going up in 2005? There wasn't a recession and Gordon was splashing plenty of cash about so how do you explain that one? From everything you say unemployment should fall not rise when a government is spending billions it hasn't got.
To make it easier I'm going to ignore the fact that Gordon kept unemployment artificially low by making it easier to allow people to claim Disability Living Allowance. This kept over 0.7m people off the unemployment register. I'll also ignore the fact that he kept people in education for an extra 2 years and encouraged a massive increase in university education to keep people off the jobless total.
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I'm still waiting for an answer. Why did unemployment start going up in 2005? There wasn't a recession and Gordon was splashing plenty of cash about so how do you explain that one?
Let me make this PLAIN from the start. I do not really want a reply ... as I have NO wish to keep this and other threads alive longer than they deserve
Surely one* of the reasons unemployment MAY have risen in the year you cited could be that the EU expanded and a host of Countries e.g. Poland Hungary The Baltic States Malta Sloakia Slovenia etc etc suddenly had a mass exodus of willing workers who could now move with economic freedom throughout Europe
It is not inconcieveable that LOTS of them came to England and sought and got work and so made lots more of the "local" poulation "sign on"
* I dont think any SINGLE factor probably accounts for this
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There wasn't a recession and Gordon was splashing plenty of cash about so how do you explain that one? From everything you say unemployment should fall not rise when a government is spending billions it hasn't got.
Maybe Gordon was splashing that cash about trying to prop up the Banking sector, which was in real danger of imminent collapse, and where would that leave people like your good self who`ve been prudent and saved their cash? you would n`t have had any if the Banking Sector had been left to fend for themselves letting the markets dictate their fate! you`ve a lot to thank Gordon and the Leftie barmpots for Mick!
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I'm still waiting for an answer. Why did unemployment start going up in 2005? There wasn't a recession and Gordon was splashing plenty of cash about so how do you explain that one? From everything you say unemployment should fall not rise when a government is spending billions it hasn't got.
Mick.
A Keynes or a Friedman would say that there's a very simple and logical explanation. This is what they would say.
In the early 2000s, most industrialised economies experienced a minor recession. USA did, Germany did, Japan did, France did etc etc.
We didn't. The combination of monetary easing by the BoE and (a small) fiscal stimulus by the Treasury meant that our GDP growth remained broadly steady and unemployment continued to fall. By 2004, unemployment was lower than it had been for 26 years. Friedman would argue that it was approaching NAIRU, and indeed, inflation did start to rise, from ~1% to ~2.5%.
To head this rise in inflation off, The BoE increased interest rates (less than a year before the 2005 Election interesting timing for a Bank that was under Brown's control, eh?) The result was that some demand was taken out of the economy (which is what raising interest rates does), inflation stabilised at ~2.5-3% and as a result, there was a small rise (from ~5% to ~5.5%) in unemployment.
Keynes or Friedman would say that this was classic macroeconomic management going on.
But we've kicked out Keynes and Friedman and replaced them by Mickonomics. What's the Mickonomic answer? Did Brown secretly go out at night with a cig lighter and set fire to jobs?
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John Maynard Keynes was wrong. Milton Friedman was wrong. That's the two 20th century giants whose economic theories have been applied throughout the capitalist world for 65 years comprehensively demolished.
At last you've seen the light and realised that these economists were both cranks.
Been following this debate with interest, but when I read this I wish I had a drink with me so I could spit-take. I might not be an economic expert, but I can still see the flaws in denying decades of empirical evidence and just saying "that's wrong". Nobody is going to listen to you when you start sticking your fingers in your ears and saying history's great economists, who's theories have been tried and tested since the Great Depression of the 30s and were put to effective use by Roosevelt's New Deal, are wrong, just 'cos you say so. It's proven by empirical evidence. It's fact. It happened. Or was Roosevelt some blind leftie nutjob who used "crank" theories?
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mjdgreg.
A Keynes or a Friedman would say that there's a very simple and logical explanation. This is what they would say.
In the early 2000s, most industrialised economies experienced a minor recession. USA did, Germany did, Japan did, France did etc etc.
We didn't. The combination of monetary easing by the BoE and (a small) fiscal stimulus by the Treasury meant that our GDP growth remained broadly steady and unemployment continued to fall. By 2004, unemployment was lower than it had been for 26 years. Friedman would argue that it was approaching NAIRU, and indeed, inflation did start to rise, from ~1% to ~2.5%.
To head this rise in inflation off, The BoE increased interest rates (less than a year before the 2005 Election interesting timing for a Bank that was under Brown's control, eh?) The result was that some demand was taken out of the economy (which is what raising interest rates does), inflation stabilised at ~2.5-3% and as a result, there was a small rise (from ~5% to ~5.5%) in unemployment.
Keynes or Friedman would say that this was classic macroeconomic management going on.
But we've kicked out Keynes and Friedman and replaced them by Mickonomics. What's the Mickonomic answer? Did Brown secretly go out at night with a cig lighter and set fire to jobs?
So you accept what these cranks tell you. Who do you support Keynes or Friedman? On most things they hold diametrically opposing views. You seem to be in the Keynes camp but then deftly quote Friedman if it suits you. The fact that you regard these two nutjobs as the best economists in the world over the last however long says a lot about what you know about economics. The economist that knows what he is on about is Peter Schiff.
So you accept 1.5m as being an unemployment price well worth paying. Well I and many right-minded people don't. You base your logic on this. We all know that the published government figures on unemployment always underestimate the true level of unemployment so it is reasonable to assume that the real figure was quite a bit higher than 1.5m. If you add in the extra 0.7m who claimed DLA instead of the more relevant Job Seekers Allowance and all the students who were made to stay on at school and all the economically inactive people that don't show up in the statistics, the true figure would have been well over 2.5m. So your theory doesn't work and your logic is flawed. So accepting that the real level of unemployment was over 2.5m why did it start rising?
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MachoMadness, I don't say Keynes and Friedman were cranks just for the sake of it. Billy quotes these two who hold diametrically opposed views to each other. How can they both be right? It's impossible. The economist that he should be listening to is Peter Schiff. He predicted what was going to happen. He is anti Keynes. Billy is pro Keynes (but also pro Friedman when it suits). Talk about contradictory. Here is a youtube clip of Peter Schiff being ridiculed about his 'correct' views by pretty much everyone out there, especially the Keynes followers such as Billy. Nearly everything he says about the US can also be applied to the UK.
http://www.youtube.com/watch?v=2I0QN-FYkpw
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Also from Youtube .... clue : Listen to the script !
http://www.youtube.com/watch?v=hnTmBjk-M0c
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Maybe Gordon was splashing that cash about trying to prop up the Banking sector, which was in real danger of imminent collapse, and where would that leave people like your good self who`ve been prudent and saved their cash? you would n`t have had any if the Banking Sector had been left to fend for themselves letting the markets dictate their fate! you`ve a lot to thank Gordon and the Leftie barmpots for mjdgreg!
Gordon should have let the banks go bust. Yet another of his huge blunders. That's how capitalism works. But they knew full well that the dimwit would not let this happen so they took ridiculous gambles knowing that if they lost Gordon would come to the rescue with taxpayer's money.
I took my money out of banks years ago and put it all into property, gold or my gambling account. When the banks eventually do go bust (trust me, it is just a matter of time) they won't be taking me with them.
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Surely one* of the reasons unemployment MAY have risen in the year you cited could be that the EU expanded and a host of Countries e.g. Poland Hungary The Baltic States Malta Sloakia Slovenia etc etc suddenly had a mass exodus of willing workers who could now move with economic freedom throughout Europe
It is not inconcieveable that LOTS of them came to England and sought and got work and so made lots more of the "local" poulation "sign on"
Another massive Brown blunder. We could have severely restricted the number of immigrants but didn't. Gordon wanted them to come to keep wages down and indirectly inflation. British jobs for British workers. Don't make me laugh.
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4) I'll repeat. When the recession exploded and unemployment rose above NAIRU, Brown did the correct thing of kicking in the big fiscal stimulus. It worked and would have continued to work had Gideon not pulled it.
Given that the coalition have only reduced public spending by 0.8% how do you explain your comment 'It worked and would have continued to work had Gideon not pulled it.' Seems to me that according to you, unemployment should be falling, not rising because we are still spending lots of money just as you and Mr Keynes would want us to. Why do you think George has 'pulled it'?
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Mick
I have a suggestion for how you could save more money. Get rid of your colour TV licence. It's unnecessary as you only see the world in black and white.
Where to begin?
1) It is simplistic and deeply ignorant of the detail to call Keynes and Friedman "diametrically opposed". Frankly it's silly. The both accept that both fiscal and monetary policy influence macroeconomic performance. where they differ is on the preferred balance between the two approaches. Keynes lent towards fiscal measures, Friedman strongly towards monetary approaches. Indeed Friedman's life work was an attempt to provide a theoretical framework to demonstrate that fiscal tinkering was unnecessary.
They differed, but to say that they were diametrically opposed is silly. They agree on the basic mechanics of economics, but differ on the conclusions. The truth, usually, as in most things, lies somewhere between the extremes of the fundamentalists on either side.
My take, for what it's worth is that Friedman's assessment of the power of monetary policy is extremely powerful, but not sufficient in itself to stabilise economies that veer wildly off track. So, monetary approaches are suitable in relatively calm times, but hopeless in severe recessions. Keynes's work was a response to the Great Depression and an attempt to ensure that one never happened again. Unfortunately, he has been out of favour for a generation. We need to re-learn his lessons, and bloody quickly.
2) I take my hat off to Schiff. He called it right. But that doesn't mean that I agree with his assessment of how you get out of a Depression. A person can predict that smoking will give you lung cancer, but you wouldn't automatically assume therefore that the same person would know how to cure lung cancer. His claim that a big recession is welcome and necessary is like a Catholic saying you need to suffer to atone for your sins. It's not true, but it sounds plausible. Keynes shows precisely and in great detail exactly how to get out of a recession like this. It sounds counter intuitive, but it works and had been demonstrated to work. It requires demand to be generated by Govt spending. There is no other way and there never has been any other way. Schiff's medicine leads you straight down the Japan route of institutionalised zero growth and the consequent REAL explosion of debt.
And to call his critics "Keynesians" is bloody stupid. The arguments they were using are far closer to the Friedman idea of the sanctity and logical sanity of the Market.
By the way, Schiff wasn't the only far-sighted one. In 1998, Paul Krugman (Keynesian to his toe nails) wrote "The Return of Depression Economics" in which he ominously flagged up how the rejection of Keynesian approaches had led to massive recessions in many parts of the world during the 90s - Japan, Korea, Thailand, Mexico, Argentina. He was crying out, 14 years ago for America and Europe not to make the same mistakes. They did (Brown included).
3) Of course I don't think 1.5m unemployed is "acceptable". What I don't know is any way for us to have lower unemployment without inflation kicking in. At least not in the world that has adopted a predominantly Freidman-esque economic approach. If you know how to do it then explain, quick.
By the same token, I don't think it is acceptable that my car uses more diesel when I drive faster. I want my car to do 100mph and 200mpg. For some reason, it just won't do it. I don't like it, but I don't have any way to correct it. Neither do the finest minds in automotive engineering.
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Here's a little history lesson about the folly of following a Keynesian approach. An approach that Ben Bernanke is currently following which is going to have disastrous consequences for the USA and indirectly the world. Unfortunately you are wrong when you say Keynes has been out of favour for a generation. His deluded strategy is alive and well in many economies today.
"We used to think you could spend your way out of recession by boosting government spending. I tell you, in all candour, that option no longer exists. And in so far as it did exist, it only worked on each occasion since the war by injecting a bigger dose of inflation into the economy, followed by higher unemployment as the next step…"
Who said this? Jim Callaghan delivered these words to the 1976 Labour party conference. The penny had finally dropped that a Keynesian approach to economics caused much bigger problems than it solved.
Successive governments had used 'deficit financing' and high state spending to 'pump-prime' economies. Such policies plunged the world's most advanced economies into crisis after crisis - with the cash propping up inefficient industries and the markets lending only at escalating interest rates.
Prior to Callaghan's speech, the history of the Labour party, in particular, was littered with grim episodes involving huge national debts, soaring inflation and a plunging pound. But this speech was a turning point, marking the start of the Western world's painful, but essential, conversion to monetarism, lower tax and independent central banking.
Throughout the 1980s, as unemployment spiralled, and the UK endured long overdue structural changes, clearing up after years of Keynesian consensus, such 'small government', policies weren't popular. But eventually, certainly by the early 1990s, everyone realised - as Callaghan was brave enough to admit - that high state spending is a mug's game. Some die-hards such as Billy kept the red flag flying, but those with a chance of gaining power had grasped deficit-financing doesn't work - and wrecks any nation's long-term economic health.
Unfortunately Mr Brown's response to economic woes, was to go all Keynesian on us. Brown, deep down believed in big government and big deficits. In today's world of fibre-optic currency dealing and round-the-clock markets, such policies are even more fatal than during the 70s. He was warned by the International Monetary Fund not to try 'spending his way out of a slowdown'. Back in 1976, deficit-spending forced Labour's then Chancellor, Denis Healey, to beg for an IMF bail-out. Brown didn't learn the lessons from history. The UK has the highest budget deficit in the G8. Other leading nations pared their borrowing, but Brown just let rip. In June 2008, the Government took on another £9.2bn of debt on our behalf - 40 per cent higher than June 2007. Labour, disgracefully,vastly exceeded its own borrowing forecasts every year for the previous eight years.
The IMF wanted 'concrete and front-loaded plans to bring debt back below the ceiling'. Ministers claimed the 40 per cent of GDP threshold remained. But they excluded 'temporary' Northern Rock liabilities, much of the Private Finance Initiative and a host of other items were swept off the nation's balance sheet. The markets and ratings agencies weren't fooled. The IMF worried about Britain losing its fiscal credibility, Sterling weakened and inflation rose. Unemployment carried on creeping up. The UK was now running a Keynesian economic policy.
"Yes I have allowed borrowing to increase, because that's the right thing to do to support the economy" said Brown. He demonstrated that he knew nothing about economics, or the history of his own party. Borrowing on this scale was insane.
'There are times,' said Jim Callaghan after he left office, 'perhaps once every 30 years, when there is a sea-change in politics, a shift in what the public wants and approves of.'
That shift is now happening. The public, the vast majority, anyway - wants lower taxes, less public sector waste and, lower government spending. Brown simply didn't get that the clown.
So there you have it. Keynes was a crank and all those that followed him were fools. Especially Gordon Brown and Ben Bernanke. Anyone who still advocates following this approach needs to brush up on their history. I will now make a prediction that within the next few years the USA is going to implode very badly and drag the rest of the world down with it because they are currently following a Keynesian approach. Their only hope is that Obama doesn't get in again.
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Your hero Paul Krugman is also a crank. Why won't he debate with Peter Schiff? Because he knows he'd get a serious battering.
http://www.youtube.com/watch?v=Z9KyzHEeHgs
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Mick
1) Copying and pasting huge chunks of slanted opinion is not how discussion works. Anyone can trawl the Internet and find an opinion that supports their own. You in particular are a master at it. Doesn't make it correct.
2) So a Labour PM was entirely correct when he said something that you agree with? He's not some Lefty crank? Do I need to point out the infantile nature of this selective quoting?
3) For the record, after Callaghan's speech, the UK did reject Keynesianism and embarked on a decade long experiment in fundamental monetarism. Callaghan had criticised Keynesian approaches as building in higher inflation and higher unemployment.
By the time Thatcher resigned, it was 14 years since Callaghan's speech and monetarism had ruled the roost for that time. Thatcher's Govt very pointedly refused a Keynesian stimulus in the 80-81 recession. They said that the hard monetarist approach was necessary to drive down inflation and set the scene for stable employment.
So, after all that pain, what happened? By the time Thatcher resigned, unemployment was double what it was in 79, and rising. It didn't get back down to 1979 levels until 2003 (and you say that even that level is unacceptable Mick). Inflation was higher than in 79 and rising. Govt debt to GDP was lower than in 79, but about to rise again as the economy fell off a cliff into another deep recession.
Following Thatcher's ejection, we had 15 years of a pragmatic compromise between monetarist control of interest rates and Keynesian deficit spending when a stimulus was required. That gave us the longest spell of continued growth in 120 years.
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Mick, you've gone all Goodness Gracious Me on us again.
"(Insert name of anyone Mick diesn't agree with). Crank!"
'kin hell, it's like being in the playground again. EDIT: And I said that before I realised that you had taken to posting YouTube cartoons to support your argument. What's next? Flicking bogies and calling people poo-poo face?
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One final question Mick, that gets right to the heart of the debate.
Why is high Govt debt a bad thing? Give me your take on why it is bad and what the consequences of it are.
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Given that the coalition have only reduced public spending by 0.8% how do you explain your comment 'It worked and would have continued to work had Gideon not pulled it.' Seems to me that according to you, unemployment should be falling, not rising because we are still spending lots of money just as you and Mr Keynes would want us to. Why do you think George has 'pulled it'?
Still waiting for an answer.
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Why won't Krugman have a debate with Schiff?
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Why did unemployment rise from 2005 under Labour when the true rate was over 2.5m making your original answer based on 1.5m invalid?
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Do you accept that the BoE is politically influenced?
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Why do you say the Keynes school of thought has been missing for a generation when the world's biggest economy is controlled by Ben Bernanke who is a massive Keynes follower?
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Why do you think people should spend to get us out of the mess we're in when most of them are in debt, have seen their houses fall in value (and they are going to keep falling), wages being frozen/cut and standard of living falling? Why don't you think it is right for them to get their debts under control before they start spending again? What is wrong about living within your means?
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What would happen if the government found that no-one was daft enough to lend them any more money because we've reached the point when there are serious doubts about us having the ability to pay it back? What would Mr Keynes do then?
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Do you think Gordon was correct to bail out the banks?
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Why is high Govt debt a bad thing? Give me your take on why it is bad and what the consequences of it are.
I think anyone who has read my previous posts already know that I have answered this question in graphic detail. But seeing as you still haven't got the message I'll give a brief summary of my views.
High government debt means a high budget deficit which will cause a high current account deficit. The situation will adversely affect the interest rate, exchange rate and country's competitiveness. The growth of GDP will be down, exports will decline, while imports will increase. Unemployment will rise. The National Debt will increase.
It is also morally wrong to expect future generations to pay higher tax and have a worse standard of living than us because we have been living beyond our means. I could go on but by now hopefully you get my drift.
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Mick. My final words on the issue. I think we've done this to death now but (gentleman that I am) I will answer every one of your points.
1) Given that the coalition have only reduced public spending by 0.8% how do you explain your comment 'It worked and would have continued to work had Gideon not pulled it.' Seems to me that according to you, unemployment should be falling, not rising because we are still spending lots of money just as you and Mr Keynes would want us to. Why do you think George has 'pulled it'?
0.8% of a £1.5 trillion economy adds up to a rather large amount. More than £12bn. That's £12bn per year removed from the economy. It'd pay for about 250,000 jobs directly. And those people would have money in their pockets and buy things that other people make, keeping them in work too. That's the whole nub of the argument. And, crucially, the main Coalition cut-backs right at the start were in infrastructure projects. So you have builder workers, engineers etc, sat on their arses drawing dole, when they could have been producing improved infrastructure for the country. New houses. New schools. New fibre-optic systems.
Why won't Krugman have a debate with Schiff?
I'm not Krugman's PA. I neither know nor care. I don't need to see them debate. I can read what each of them says and make up my own mind.
Why did unemployment rise from 2005 under Labour when the true rate was over 2.5m making your original answer based on 1.5m invalid?
Why did unemployment rise? I gave you my two pennorth here on this very same page. http://www.drfc-vsc.co.uk/index.php?topic=233536.msg251776#msg251776 (http://www.drfc-vsc.co.uk/index.php?topic=233536.msg251776#msg251776)
Is your attention span THAT short?
Do you accept that the BoE is politically influenced?
Everyone in the world is politically influenced. Your question is meaningless. If what you really mean is "Do you accept that the BoE is unduly politically influenced in its decisions on setting interest rates" then my answer is "no". For the reasons that I set out in the EDIT part of this post: http://www.drfc-vsc.co.uk/index.php?topic=233536.msg251574#msg251574 (http://www.drfc-vsc.co.uk/index.php?topic=233536.msg251574#msg251574)
Why do you say the Keynes school of thought has been missing for a generation when the world's biggest economy is controlled by Ben Bernanke who is a massive Keynes follower?
The US economy is not "controlled" by Bernanke. Who do you think he is? Goldfinger? As head of the Fed, he can decide monetary policy. He cannot control fiscal policy. That's the job of the President and Congress. Obama, at heart is a Keynesian, but his attempts to run Keynesian stimuli have been hobbled by the Tea Party in Congress. Prior to Bernanke taking over at the Fed, it was run for a generation by committed anti-Keynesians, most notable Alan Greenspan. You want a candidate for the man who did most to engender the current Catastrophe? Go look at Greenspan. He was the one who fostered the debt boom for 10 years.
Why do you think people should spend to get us out of the mess we're in when most of them are in debt, have seen their houses fall in value (and they are going to keep falling), wages being frozen/cut and standard of living falling? Why don't you think it is right for them to get their debts under control before they start spending again? What is wrong about living within your means?
How do you get debt under control if your earnings collapse? And how do you keep earning if everyone (or a significant proportion of the population) stops spending? I have heard no serious answer to this from anyone, beyond a hope that some confidence fairy will sprinkle magic dust over the economy and we'll all find work, once we have suffered enough. And I'm being serious here. In 2009, Austerity was put forward as the answer to all our ills by the (anti-Keynesian) head of the ECB, Jean-Claude Trichet said: "The idea that austerity measures could trigger stagnation is incorrect. Confidence-inspiring policies (through cutting back deficits) will foster and not hamper economic recovery." Aye. Right there. Look how effectively Austerity-inspired confidence has helped European growth over the past couple of years.
http://www.tradingeconomics.com/euro-area/gdp-growth (http://www.tradingeconomics.com/euro-area/gdp-growth)
Or Unemployment
http://www.tradingeconomics.com/euro-area/unemployment-rate (http://www.tradingeconomics.com/euro-area/unemployment-rate)
The argument that you get out of a serious debt-fuelled Depression by everyone cutting back spending is PRECISELY the mistake that Herbert hoover made in 1929-30, triggering the God Almighty Depression. It's the mistake that Japan made in 1990. It doesn't work, either in theory or in practice. You can repeat it as many times as you want but it doesn't work. It never has and it will not do this time.
What would happen if the government found that no-one was daft enough to lend them any more money because we've reached the point when there are serious doubts about us having the ability to pay it back? What would Mr Keynes do then?
This is the ace in the hole for the Austerity brigade. If we don't stop borrowing, bond rates will go up, just like they did in Greece, Spain, Italy etc.
Well here's a funny thing Mick. When Gordon Brown was spending like a drunken sailor (as you so childishly put it) and our deficit was sky-rocketing, you'd have thought that our bond rates would have gone up as investors got the jitters. But they didn't. They came down by nearly half between 2007-2010. That's long-term Govt bonds. So, even when the deficit was at its highest, the Markets still gave no sign whatsoever, none at all that they considered us to be at risk of not re-paying our debt. The same story goes for USA. It's Govt debt has almost doubled since 2007, but its long term bond rates have halved. The same goes for Japan. It's Govt debt has quadrupled since 1990, but it's bond rates are one-sixth of what they were back then.
Here's a funny thing Mick. Even though our debt to GDP is now three times higher than it was when Thatcher left office, the interest rate we pay on that debt is 5 times lower. So, the amount we are paying the Markets in interest to fund Govt debt is LOWER now than it was when our debt reached a record low in 1990. Figure that one out. And show me where the indications are that the Bond Markets are going to suddenly go all vigilante on us.
Do you think Gordon was correct to bail out the banks?
Yes. Without doubt. Because, had he not done so, we would now be in the middle of an unimaginable catastrophe, instead of just a very bad one. You reckon that if he'd let a couple of banks fail, we'd have just carried on as normal the day after? Really?
Final answer to your final post.
The trouble is with your pontificating, is that there is not a shred of evidence from history to back it up.
At the end of WWII, we had a Govt Debt to GDP ratio of 250%. According to your theory, that should have led to economic meltdown. It didn't. We had a 30 year period of almost consistent growth, with some relatively mild recessions along the way. GDP went up. Unemployment stayed at historically very low levels. The National Debt came down. Rapidly. And in only 6 years in that whole time did the Govt run an annual surplus. That was Keynesian economic management in practice. We had no option but to run up a colossal debt during the war. We sorted it out, not by Austerity, but by accumulation of more debt which was put to work in making the economy grow. It worked, spectacularly well. It's the solution now. And it does NOT result in future generations having to pay higher taxes. It results in future generations having a better standard of living through a dynamically growing economy.
There's the nub of the difference. The policy that I support has been demonstrated to work. The Austerity policy has been demonstrated to produce the biggest Depression of the last 150 years. As Einstein said, continue to put forward the same argument when it has been shown to fail is a definition of insanity.
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Bugger. Just written out a detailed reply to every one of your questions and the site has swallowed it up and not processed it. Not got time to do it again. Suffice to say that most of your questions have thorough answers on this very thread.
The key one, the one that gets right to the heart of the matter is your final post. The people supporting a reining back of debt by reducing spending rely on the arguments that:
a) You can reduce debt and get the economy going again by reducing spending
b) there will be the dire consequences if you don't reduce Govt spending.
But history actually says exactly EXACTLY the opposite.
In 1945, our Govt debt to GDP was 250%. We'd had no option but to run a huge deficit during the war. According to your ideas Mick, we should have had economic Armageddon after the war. At the very least, we should have slashed Govt spending to next to nothing and hoped that the Market would respond and fill the gap.
That's not what happened.
We ran Govt Deficits in 24 of the next 30 years. Only 6 times did the Govt balance the books. And the result? Almost continuous GDP growth. Unprecedented low unemployment for a generation.
Want to know the secret Mick? We never paid off the debt. We carried on picking up more debt pretty much every single year. The debt went up from ~£20bn in 1945, to ~£35bn in 1970. But the economy grew even faster. Much faster. So the debt as a proportion of our income fell from £250% to about 40%. The only really nasty recession we had during that time was in 1947-8, when the Labour Govt had actually balanced the books by savagely cutting Govt spending. The result was that the economy collapsed for 12 months. The Govt then re-commenced running deficits and the economy took off. By 1970, GDP was five times bigger than it had been in 1945. That was the result of almost continuous Govt deficits.
Now. Your approach in 1945 would have been for us to pay back debt as quickly as possible. To reduce Govt spending as rapidly as possible. There are historical examples of this being done, apart from the one year that it was tried at the end of the war.
Herbert Hoover did it in 1929-30. That is what tipped the World into the Mother of All Depressions.
Japan did it in 1990-92. That is what tipped them into the Lost Decade, from which they have still not really emerged.
And Ireland, Greece and Spain are doing it right now. Right as we speak. The consequence is collapsed GDP and 25% unemployment.
I agree that I want the future for my kids to be good. I want them to pay low taxes and have a strong economy. But you do not do it by cutting back now. There is not a single example in the history of the world of that approach working to solve a debt crisis during a big, global recession. Not one. As Einstein said, "Doing the same thing over and over again and expecting difference results next time is a definition of insanity."
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Bugger. Just written out a detailed reply to every one of your questions and the site has swallowed it up and not processed it. Not got time to do it again. Suffice to say that most of your questions have thorough answers on this very thread.
Pull the other one. As soon as I start asking you to answer my questions you come up with some cock and bull story because you can't answer them. I'll leave the readers to make of that what they will.
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Dogs and rabbits spring to mind.
But, since you are so keen to hear from me, I'll indulge you.
The answers to everyone but 2 of your Tourette's-like question outburst are in this very thread. Go and read them.
The other two.
1) I have no idea why Krugman won't debate with Schiff. Do you think I'm his PA? I also have no interest in a debate. I can read what each of them writes and make up my mind without seeing them in the flesh.
You know what happens in debates? The smoothed polished one wins, not necessarily the one with the right answers. See under "Nick Clegg".
2) 0.8% of of Govt spending is not a trivial amount. It is the thick end of £10bn. That would have directly funded something like 100,000 jobs. Those people would then be buying other goods and services and keeping other people in work. There would also be less spent on dole payments as a result.
THAT is why the current Govt's spending reductions throttled off growth and unemoyment reduction. The figures are bloody obvious. We grew about 2% between late 09 and late 2010. In the last 21 months, since the Coalition cuts began, we have grown by precisely zero.
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Bugger. Just written out a detailed reply to every one of your questions and the site has swallowed it up and not processed it. Not got time to do it again. Suffice to say that most of your questions have thorough answers on this very thread.
Pull the other one. As soon as I start asking you to answer my questions you come up with some cock and bull story because you can't answer them. I'll leave the readers to make of that what they will.
I think the readers sussed long ago that you are a Troll, almost every post you make condradicts a previous post you've made!
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I think the readers sussed long ago that you are a Troll, almost every post you make condradicts a previous post you've made!
If that's the case then I challenge you to find 10 examples out of the 100's that I've posted. I'm not holding my breath.
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The answers to everyone but 2 of your Tourette's-like question outburst are in this very thread. Go and read them.
Untrue. If that is the case then it should only be a 2 minute job to copy and paste your previous answers with my questions. I'm not holding my breath.
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Jesus wept. Just to f**king well shut you up.
1) Was Brown right to bail out the banks?
Yes. Comprehensively. We would have been in the Depression to end all Depressions had he not. Total and utter meltdown.
2) Is the BoE politically influenced?
The question is meaningless. If you mean "Does the Treasury put pressure on the BoE to change interest rates in a way that helps the Govt?" then "no". Otherwise, why on earth did Brown let them significantly raise rates in the run up to the 2001 and 2005 Elections.
Still waiting for your evidence to the contrary.
3) Bernanke does not contr the US economy. As head of the Fed, he is responsible for monetary policy. Fiscal policy (the key Keynesian lever) is controlled by President and Congress. Obama is a Keynesian but has been hamstrung by the flat-earthers in the Tea Party. So proper Keynesian responses are not being implemented.
By the way, Bernanke's most important predecessor, Alan Greenspan, was a devout anti-Keynesian. You want a candidate for the man who did most to screw the world economy? Start with him.
4) Why did unemployment rise in 2005. Answer on page 2. Go dig it out because I'm f**ked if I'm writing it again.
Any more scattergun questions? That's every one that you have fired off answered in depth.
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1) I have no idea why Krugman won't debate with Schiff. Do you think I'm his PA? I also have no interest in a debate. I can read what each of them writes and make up my mind without seeing them in the flesh.
The correct answer is that Krugman knows he would lose and his reputation would be trashed more than it already is.
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Why do you think people should spend to get us out of the mess we're in when most of them are in debt, have seen their houses fall in value (and they are going to keep falling), wages being frozen/cut and standard of living falling? Why don't you think it is right for them to get their debts under control before they start spending again? What is wrong about living within your means?
Still waiting for a proper answer.
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What would happen if the government found that no-one was daft enough to lend them any more money because we've reached the point when there are serious doubts about us having the ability to pay it back? What would Mr Keynes do then?
Still waiting for an answer.
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Why did unemployment rise from 2005 under Labour when the true rate was over 2.5m making your original answer based on 1.5m invalid?
Still waiting for an answer not based on an unemployment figure of 1.5m.
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Any more scattergun questions? That's every one that you have fired off answered in depth.
I need answers to all my other questions before I fire off any more at you. Answered in depth. Don't make me laugh. It's like pulling teeth getting answers off you. I bet you failed all your exams at school because you didn't read the questions properly and gave answers that were nothing to do with the question (that's if you tried to answer the question in the first place).
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1) I explained the Paradix of Thrift weeks ago, but since you don't even remember what has been posted in this thread, here we go again.
If I pay down my debt, by definition I buy less of your goods and services. And vice versa if you are paying own your debt. So, we both see our income reduce. Multiply that across the economy as a whole and you see the paradox. By everyone paying down debt simultaneously, we all get poorer. The debt we have left as a proportion of our income may actually increase. As the old economist said in that situation: the more debt you pay back, the more you owe.
You CANNOT pay of debt without economic growth (without our economy and society going back a century). You CANNOT get economic growth if everyone is paying off debt. Simple really.
2) Ah yes. That one about the bond markets eventually deciding not to lend to us. That is what the right wingers have been saying or years. If we don't stop borrowing, the markets will crucify us. Just like Greece.
Trouble is, there's no evidence for it.
The markets indicate a country's ability to pay back debt by the interest rate they charge on borrowing through Govt bonds. Higher rates equals more danger of the country defaulting.
When Brown was spending like a drunken sailor as you so childishly put it, when the UK debt was going through the roof, surely the bond markets would have taken fright? Surely our bond rates would have rocketed?
Nope.
Between 2007 and 2010, our bond rates fell by half, to record low levels.
Same thing happened in USA, even when they lost their AAA rating.
But surely, the bond markets will get spooked eventually and cripple us?
Here's the really funny thing Mick. In Japan, the Govt debt went up 4 fold between 1990 and today. Today, their Govt debt to GDP is about 250% and rising. Their bond rates are just over 1%. The markets are falling over themselves to lend money to Japan, despite them having the biggest debt problem in the world.
For countries with their own currency and control over their own monetary policy (ie, not the EuroZone) there is no indication whatsoever that the bond markets are going to go all vigilante.
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Why did unemployment rise from 2005 under Labour when the true rate was over 2.5m making your original answer based on 1.5m invalid?
Still waiting for an answer not based on an unemployment figure of 1.5m.
You were asking why the figure rose. I explained why it rose. It didn't matter whether the initial figure was 1.5, 1.5 million or 1.5 billion. I explained why it rose. Do you not even understand your own questions?
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Any more scattergun questions? That's every one that you have fired off answered in depth.
I need answers to all my other questions before I fire off any more at you. Answered in depth. Don't make me laugh. It's like pulling teeth getting answers off you. I bet you failed all your exams at school because you didn't read the questions properly and gave answers that were nothing to do with the question (that's if you tried to answer the question in the first place).
If it makes you feel better Mick, believe what you want. You wouldn't believe me if I told you my qualifications any road, so what's the point.
Now. Do you have anything substantive to add to this debate or are you going to keep asking questions and never replying when asked for your own answers.
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Why do you think people should spend to get us out of the mess we're in when most of them are in debt, have seen their houses fall in value (and they are going to keep falling), wages being frozen/cut and standard of living falling? Why don't you think it is right for them to get their debts under control before they start spending again? What is wrong about living within your means?
That's clear then. You think that the way to get out of debt is to get more debt. The only solution is to live beyond your means. Don't you realise how daft you are making yourself look? Somehow I don't think you'll find many people agreeing with you on that one. It's all well and good having these economic theories but if they bear no resemblance to the real world they are pointless.
I don't need a fancy theory from a crank economist to tell me what to do. All you have to do is use your common-sense. If you're in debt the last thing you need in a financial crisis is more debt. Get it paid off then you might have half a chance of keeping a roof over your head. Get some savings behind you and then start spending. Obvious really. Can't understand why you or Mr Keynes couldn't work that one out.
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What would happen if the government found that no-one was daft enough to lend them any more money because we've reached the point when there are serious doubts about us having the ability to pay it back? What would Mr Keynes do then?
Have you ever heard of 'worse-case scenario'? It would appear not, given your complacent answer. I'm sure we'll all sleep easier in our beds now that you have told us that the bond markets are never going to turn on us. Unbelievable.
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Aye Mick, I do believe that. And I gave you chapter and verse on EXACTLY how the country used that approach to get out of a far, far bigger debt hole after the War.
You are perfectly at liberty to disagree with me. But if you are going to do, you ought to do us the courtesy of explaining what YOU think happened to sort out our debt problem after the War.
And while you're at it, you can find us an example of any country in history that has got out of a debt problem during a recession by cutting back its spending. Just one.
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1) Was Brown right to bail out the banks?
Yes. Comprehensively. We would have been in the Depression to end all Depressions had he not. Total and utter meltdown.
So you think it was right that the banks could gamble recklessly knowing that they would always be bailed out. Not my idea of capitalism. Then again I'm not a leftie.
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What would happen if the government found that no-one was daft enough to lend them any more money because we've reached the point when there are serious doubts about us having the ability to pay it back? What would Mr Keynes do then?
Have you ever heard of 'worse-case scenario'? It would appear not, given your complacent answer. I'm sure we'll all sleep easier in our beds now that you have told us that the bond markets are never going to turn on us. Unbelievable.
Come on then. I've been inviting you for weeks to tell us exactly what the mechanisms are whereby the alternative approach (cutting debt) will work. And to give us examples of cases where it has worked.
Stop throwing insults. Give us some facts.
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1) Was Brown right to bail out the banks?
Yes. Comprehensively. We would have been in the Depression to end all Depressions had he not. Total and utter meltdown.
So you think it was right that the banks could gamble recklessly knowing that they would always be bailed out. Not my idea of capitalism. Then again I'm not a leftie.
No. I didn't say that. Go back and read your question and my answer.
The underlying problem was that the banks were allowed FAR too much leeway to take reckless gambles. Not only in the UK. EVERYWHERE.
With hindsight (there we go again) this should have been stamped down on. You will not find a single right wing politician, banker, financier or economist who was asking for that AT THE TIME.
Once we ended up where we were, then we and every single other major country in the world had absolutely no option but to bail out the banks.
We should not have got to that position. That was the result of 30 years of free-market deregulatory madness, which New Labour hold as much responsibility for as anyone. Banks should not have been allowed to get so big that their failure would bring entire economies down. The world ended up with banks that had assets (or debts) bigger than entire countries' economies. Madness. With its roots right back in the right wing fundamentalism that swept the world in the late 70s.
But you didn't ask about that. You asked if Brown was right to bail them out. Which he was. Having ended up in that position, we would be living in caves and eating rats now if Brown had not taken the lead and shown the mechanism to save the world banking system.
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How are we getting on with them answers by the way? Google down is it?
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You were asking why the figure rose. I explained why it rose. It didn't matter whether the initial figure was 1.5, 1.5 million or 1.5 billion. I explained why it rose. Do you not even understand your own questions?
Your answer was based on NAIRU and an unemployment rate of 1.5m. You have not answered this question properly. You'll be pleased to know that I've now given up on getting a proper answer as there's only so many times I'm prepared to ask.
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Oh for f**ks sake Mick, engage your brain.
If the HEADLINE rate of unemployment was 1.5m, and inflation started to rise then 1.5m was the headline rate corresponding to NAIRU. Whatever you claim the "real" rate was. That real rate would have been the "real" NAIRU rate.
Is that so hard to understand?
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Oh for f***s sake Mick, engage your brain.
If the HEADLINE rate of unemployment was 1.5m, and inflation started to rise then 1.5m was the headline rate corresponding to NAIRU. Whatever you claim the "real" rate was. That real rate would have been the "real" NAIRU rate. It is simply a matter of definition of unemployment. It doesn't alter the argument about how and why the rise happened.
There is no contradiction. Just another failure on your part to follow simple logic.
Is that so hard to understand?
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Come on then. I've been inviting you for weeks to tell us exactly what the mechanisms are whereby the alternative approach (cutting debt) will work. And to give us examples of cases where it has worked.
I'll stop throwing insults if you give us some facts.
It's very simple and I have explained this in the past. You have me down as a one trick pony that believes that the solution is just to cut debt. Wrong. I've never said that this was the solution. However it is part of the solution.
You on the other hand are a one trick pony. You pin all your hopes on spending ever larger sums of money until eventually you spend so much that everything will be all right. No wonder politicians like the sound of that. It saves them from having to make any tough decisions. Trouble is that policy always ends in disaster. Just ask Jim Callaghan. Politicians and the public need to harden up like I've done and take the medicine.
Here is the solution. We need to cut back on public spending so that taxes can be cut. This needs to be a gradual process. By doing it gradually we can take up the unemployed public sector workers in the then thriving private sector. We need to stop borrowing money and start to live within our means. We need to get the National Debt paid off. We need to harden up and accept a lower standard of living for the sake of future generations' tax bills. Simple really and I didn't need to read it in a book written by a crank economist.
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Oh for f***s sake Mick, engage your brain.
If the HEADLINE rate of unemployment was 1.5m, and inflation started to rise then 1.5m was the headline rate corresponding to NAIRU. Whatever you claim the "real" rate was. That real rate would have been the "real" NAIRU rate.
Is that so hard to understand?
I'm afraid it is. Makes absolutely no sense to me whatsoever. I don't think I'm alone on that one. Let's try a little experiment. Don't elaborate on what you've said and let's see if anyone else understands what you're going on about. If they do then let them put it in simple English so we can all understand.
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You are perfectly at liberty to disagree with me. But if you are going to do, you ought to do us the courtesy of explaining what YOU think happened to sort out our debt problem after the War.
I wish you'd stop banging on about the war. In case you hadn't noticed the world has completely changed since then.
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If that's the case then I challenge you to find 10 examples out of the 100's that I've posted. I'm not holding my breath.
Still waiting. I'll make it easier. Can you find 5?
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If that's the case then I challenge you to find 10 examples out of the 100's that I've posted. I'm not holding my breath.
Still waiting. I'll make it easier. Can you find 5?
I can find them, but being the kind of person I am, I don`t want to make you look foolish, you seem to be good at doing that yourself, without further input from me, I bet your parents regret the day they put you straight on the Cow & Gate
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Here is the solution. We need to cut back on public spending so that taxes can be cut. This needs to be a gradual process. By doing it gradually we can take up the unemployed public sector workers in the then thriving private sector. We need to stop borrowing money and start to live within our means. We need to get the National Debt paid off. We need to harden up and accept a lower standard of living for the sake of future generations' tax bills. Simple really and I didn't need to read it in a book written by a crank economist.
Nice wish list Mick. A bit light on the "mechanics" that I was asking for. As in: how in practice would you get from A to B? How would your decisions translate into real-world effects?
Here's the question Mick. How do you get the private sector thriving. I want to see a thriving private sector. We need a thriving private sector. But you don't get it from the current situation if no-one is spending. Not possible, because who is the private sector going to sell to in order for it to thrive?
Businesses are not spending, because they are terrified of the future state if their markets. Can't blame them. Individuals are not spending, because they are hardening up, taking the medicine and learning to live within their means. Just like you my shining example friend. Can't blame them.
So. How is this private sector going to thrive?
Well, you could cut taxes, give more money to business and individuals. But business already has piles of ready cash. Almost £1trillion is sitting in the bank accounts of UK businesses. That money would ordinarily be re-invested, but now businesses are scared to invest it. So giving businesses tax cuts is pointless.
Individuals? If we give individuals tax cuts, will they use it to buy stuff, or to pay off their credit cards and debts? The latter of course. So giving tax cuts to individuals will not get the economy going.
Meantime, if the Govt has given tax cuts and the economy doesn't grow, what do you think happens to Govt debt? Think about it for a moment.
I'll tell you again. There has only ever been one way to get out of the current situation. It is by Govt spending injecting demand into the economy. I'll tell you now: if we, America and Europe do not do that, and bloody soon, we are going to have 10%+ unemployment and rising debt for a decade. A perfect storm.
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You were asking why the figure rose. I explained why it rose. It didn't matter whether the initial figure was 1.5, 1.5 million or 1.5 billion. I explained why it rose. Do you not even understand your own questions?
Your answer was based on NAIRU and an unemployment rate of 1.5m. You have not answered this question properly. You'll be pleased to know that I've now given up on getting a proper answer as there's only so many times I'm prepared to ask.
I apologise Mick. I clearly overestimated your intelligence.
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You are perfectly at liberty to disagree with me. But if you are going to do, you ought to do us the courtesy of explaining what YOU think happened to sort out our debt problem after the War.
I wish you'd stop banging on about the war. In case you hadn't noticed the world has completely changed since then.
In what ways have the basic mechanics changed such that the Keynesian approach (which worked so spectacularly well back then) no longer applies. Not good enough to say things have changed. In what way have they changed?
And if they have changed, why is it that the mistakes that produced catastrophe all over the world in the 1930s caused catastrophe in Japan in the 90s. And are causing catastrophe in Spain right now?
How have things changed Mick?
And, by the way, where are those examples of countries in debt and recession getting up and running by cutting debt and raising interest rates? One will do. Any one. Just one. Unless Mickonomics says that the whole of economic history counts for nothing and we will make it up on the hoof.
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I can't find them, but being the kind of person I am, I don`t want you to make me look foolish, I seem to be good at doing that myself, without further input from you, I bet my parents regret the day they put me straight on the Cow & Gate
You're obviously struggling so I'll make it even easier. Can you find 2?
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In what ways have the basic mechanics changed such that the Keynesian approach (which worked so spectacularly well back then) no longer applies. Not good enough to say things have changed. In what way have they changed?
And if they have changed, why is it that the mistakes that produced catastrophe all over the world in the 1930s caused catastrophe in Japan in the 90s. And are causing catastrophe in Spain right now?
How have things changed mjdgreg?
I refer you to Jim Callaghan who I quoted earlier on in the thread. You must try reading my posts properly. Another factor affecting Japan and Spain and many other countries now that did not affect countries back then is the massive inflation in house prices. Property booms caused a lot of the problems in Spain and Japan (and the UK amongst others). Modern technology has made the world far more inter-dependent so what happens in one country now has much more of an impact in other countries.
I could go on but I'm sure by now you are getting my drift. So I'd appreciate it if you could stop going back so far in history to try and justify your outlandish views.
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Here's the question mjdgreg. How do you get the private sector thriving. I want to see a thriving private sector. We need a thriving private sector. But you don't get it from the current situation if no-one is spending. Not possible, because who is the private sector going to sell to in order for it to thrive?
Your argument is once again totally flawed. You say no-one is spending. Not true. I'm spending. Plenty of my mates are loaded and are spending. For example I'm currently saving up to buy another house for cash to rent out to some unfortunate person who can't afford to buy one themselves. One of my friends is currently developing some land to put a roof over other unfortunate soul's heads. Once we get people in these homes and start to collect the rent then we will save this and do the same again. The virtuous circle continues.
There are plenty of people like me and my mates that have got money coming out of there ears and are prepared to invest it for the good of the economy. You on the other hand want all those people in debt to get even more debt. Take those rose-tinted blinkers off and realise that the sensible thing for them to do is to clear their debts, not add to them. So your spending theory falls flat on it's face because it doesn't apply to the real world.
My solution is perfectly sensible. Tax cuts would give everyone more money in their pocket. I could buy more houses, cars etc and people in debt could clear their debts quicker and one day hopefully become like me and be a net contributor to society. Question. Who do you trust with your money the most to make good use of it? Politicians or yourself? A one word answer will do. Please don't make me ask several times before you finally answer me.
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I can't find them, but being the kind of person I am, I don`t want you to make me look foolish, I seem to be good at doing that myself, without further input from you, I bet my parents regret the day they put me straight on the Cow & Gate
You're obviously struggling so I'll make it even easier. Can you find 2?
Lovely. There's one in this very thread.
In post 37, you said, "Giving the BoE full control of interest rates led to monetary policy being too relaxed in the run up to the financial crash." (my emphasis).
In post 40, barely an hour and a half later, you said "He (i.e. Brown) would never have left the BoE FULLY in charge of interest rates without sticking his oar in."
A complete contradiction there in the space of 4 posts.
The other contradiction is your insistence that you are not MadMick, when you are in fact MadMick.
QED.
Any chance of you shutting up now?
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And, by the way, where are those examples of countries in debt and recession getting up and running by cutting debt and raising interest rates? One will do. Any one. Just one. Unless Mickonomics says that the whole of economic history counts for nothing and we will make it up on the hoof.
Why you keep asking me for an answer to these types of question is a mystery to me. I've never said that a country can get up and running by cutting debt and raising interest rates as the only way to achieve growth. It can be part of the solution depending on a country's situation. I don't know why you infer that I have.
If you read some of my more recent posts (and some of my old ones) you will see that what I advocate is CUTTING TAXES and cutting spending as the broad solution. Obviously there are many other factors that go into the strategy but these are the fundamental basics of where you start from. I believe in cutting taxes and reducing spending to a sensible level. You believe in taking even more tax off people and in spending and borrowing money we haven't got. You want us to keep living beyond our means and pass the bill on to future generations. I don't think that's fair and is downright immoral.
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Lovely. There's one in this very thread.
In post 37, you said, "Giving the BoE full control of interest rates led to monetary policy being too relaxed in the run up to the financial crash." (my emphasis).
In post 40, barely an hour and a half later, you said "He (i.e. Brown) would never have left the BoE FULLY in charge of interest rates without sticking his oar in."
A complete contradiction there in the space of 4 posts.
The other contradiction is your insistence that you are not MadMick, when you are in fact mjdgreg
.
Context Billy, context. You omit to say that I prefaced this statement with the following:
'However I'm in a good mood so I am going to humour you. I'm going to pretend for a short while that I inhabit the same parallel universe that you do. I'm going to assume that the BoE was given control of interest rates without political influence and make the case as to why this was yet another bad decision'.
Not a very good try and you have made yourself look a bit daft. Anyone reading that would know that I don't believe the BoE was given control of interest rates without political influence. All I did was make an argument that even if they had, it could still be pointed out that it was a bad decision.
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In what ways have the basic mechanics changed such that the Keynesian approach (which worked so spectacularly well back then) no longer applies. Not good enough to say things have changed. In what way have they changed?
And if they have changed, why is it that the mistakes that produced catastrophe all over the world in the 1930s caused catastrophe in Japan in the 90s. And are causing catastrophe in Spain right now?
How have things changed mjdgreg?
I refer you to Jim Callaghan who I quoted earlier on in the thread. You must try reading my posts properly. Another factor affecting Japan and Spain and many other countries now that did not affect countries back then is the massive inflation in house prices. Property booms caused a lot of the problems in Spain and Japan (and the UK amongst others). Modern technology has made the world far more inter-dependent so what happens in one country now has much more of an impact in other countries.
I could go on but I'm sure by now you are getting my drift. So I'd appreciate it if you could stop going back so far in history to try and justify your outlandish views.
1) I know exactly what Jim Callaghan said. He was wrong. Selectively quoting a particular speech, made for a particular audience at a particular time (the context being that there was a huge argument going on in the Labour party over whether to continue with Keynesian approaches) does not make a concrete argument.
You want to know why he was wrong? Because his argument was based on incorrect figures from the Treasury.
At the time of Callaghan's speech, the Labour Govt had been told by Treasury officials that the money had run out, that our deficit was too high. As a result, Britain couldn't borrow on the bond markets and had to take an IMF bailout. The conditions of that bailout were a rejection of the Keynesian approach and savage cuts in public spending. There was a gun being held to Callaghan's head by the IMF who said, "Chuck out the Keynesianism or you are bankrupt." That tore the Labour party apart. Callaghan was on the side of taking the bailout and the cuts. THAT is why he made that speech.
But it turned out that the Treasury figures were wildly incorrect. The deficit was nowhere near as high as they had said. If the correct figure had been known at the time, there would have been no need for an IMF bailout, no need for the cuts, no need for Callaghan's speech.
Don't take my word for it. Read what (Tory supporter) Andrew Marr has to say about it in his book A History of Modern Britain.
http://books.google.co.uk/books?id=fZ-LL5h-rW4C&pg=PA368&lpg=PA368&dq=healey+imf+treasury+mistake&source=bl&ots=4hsx06GQbp&sig=L5Eyxm4vDdz8ab2zy30GHQoLM0M&hl=en&sa=X&ei=Dab-T5kV6c3RBbLtzacH&ved=0CEwQ6AEwAA#v=onepage&q=healey%20imf%20treasury%20mistake&f=false (http://books.google.co.uk/books?id=fZ-LL5h-rW4C&pg=PA368&lpg=PA368&dq=healey+imf+treasury+mistake&source=bl&ots=4hsx06GQbp&sig=L5Eyxm4vDdz8ab2zy30GHQoLM0M&hl=en&sa=X&ei=Dab-T5kV6c3RBbLtzacH&ved=0CEwQ6AEwAA#v=onepage&q=healey%20imf%20treasury%20mistake&f=false)
In any case, you've told me remorselessly that you can't take lessons even from 20 years ago. How can you base an argument on a speech from 36 years ago? Contradiction No.3.
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Lovely. There's one in this very thread.
In post 37, you said, "Giving the BoE full control of interest rates led to monetary policy being too relaxed in the run up to the financial crash." (my emphasis).
In post 40, barely an hour and a half later, you said "He (i.e. Brown) would never have left the BoE FULLY in charge of interest rates without sticking his oar in."
A complete contradiction there in the space of 4 posts.
The other contradiction is your insistence that you are not MadMick, when you are in fact mjdgreg
.
Context Billy, context.
Context was that you said one thing, then flatly contradicted yourself 4 posts later. That was the context.
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And, by the way, where are those examples of countries in debt and recession getting up and running by cutting debt and raising interest rates? One will do. Any one. Just one. Unless Mickonomics says that the whole of economic history counts for nothing and we will make it up on the hoof.
Why you keep asking me for an answer to these types of question is a mystery to me. I've never said that a country can get up and running by cutting debt and raising interest rates as the only way to achieve growth. It can be part of the solution depending on a country's situation. I don't know why you infer that I have.
If you read some of my more recent posts (and some of my old ones) you will see that what I advocate is CUTTING TAXES and cutting spending as the broad solution. Obviously there are many other factors that go into the strategy but these are the fundamental basics of where you start from. I believe in cutting taxes and reducing spending to a sensible level. You believe in taking even more tax off people and in spending and borrowing money we haven't got. You want us to keep living beyond our means and pass the bill on to future generations. I don't think that's fair and is downright immoral.
I refer you to post 121 for the explanation of why cutting taxes will not work. I want a happy and wealthy future for my kids. That will not happen by cutting public spending and taxes right now. That is the recipe for building in a fixed Depression. THAT is what will destroy the future for our kids.
I would rather my kids pay higher taxes in an economy which has grown even more than pay low taxes in an economy that is on its knees.
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I can't find them, but being the kind of person I am, I don`t want you to make me look foolish, I seem to be good at doing that myself, without further input from you, I bet my parents regret the day they put me straight on the Cow & Gate
I`m obviously struggling BST has made me look a right tool!
See Mick, you`re not the only one that can edit quotes! That Cow & Gate you were put on was probably Aldi`s own brand and a dodgy batch at that and explains your mental dysfunction
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In any case, you've told me remorselessly that you can't take lessons even from 20 years ago. How can you base an argument on a speech from 36 years ago? Contradiction No.3.
I haven't ever said that you can't take lessons even from 20 years ago. your so full of contradictions it's untrue. I use the Jim Callaghan quote just to highlight what a joke the party were even back then and because he was Prime Minister of the party you love. This was only part of my argument. Of course we can learn the lessons from history, but banging on about the war all the time is ridiculous. Context Billy, context.
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In any case, you've told me remorselessly that you can't take lessons even from 20 years ago. How can you base an argument on a speech from 36 years ago? Contradiction No.3.
I haven't ever said that you can't take lessons even from 20 years ago. your so full of contradictions it's untrue. I use the Jim Callaghan quote just to highlight what a joke the party were even back then and because he was Prime Minister of the party you love. This was only part of my argument. Of course we can learn the lessons from history, but banging on about the war all the time is ridiculous. Context Billy, context.
Ping!
http://www.drfc-vsc.co.uk/index.php?topic=233536.msg251513#msg251513 (http://www.drfc-vsc.co.uk/index.php?topic=233536.msg251513#msg251513)
Next please...
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Interesting...that's three posts that have been deleted on posting in the last 2 days
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I haven't ever said that you can't take lessons even from 20 years ago. your so full of contradictions it's untrue.
Ping!
Have a look at post 47 in this very thread.
I quote..."Banging on about the years after the war and Japan 20 years ago is not relevant to today's circumstances. The financial world has completely changed since then."
Next!
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Meantime, if the Govt has given tax cuts and the economy doesn't grow, what do you think happens to Govt debt? Think about it for a moment.
I agree with this but then remember the flip side and the flaw in Ed Balls' argument, his proposed VAT cut has an even bigger reduction in revenue and requires a bigger growth in the economy, it wouldn't work.
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Meantime, if the Govt has given tax cuts and the economy doesn't grow, what do you think happens to Govt debt? Think about it for a moment.
I agree with this but then remember the flip side and the flaw in Ed Balls' argument, his proposed VAT cut has an even bigger reduction in revenue and requires a bigger growth in the economy, it wouldn't work.
BFYP.
There's a reason why VAT is a particularly powerful tool for adjusting demand. It's because it changes the price of things.
Cutting income tax, or NI contributions would put money into people's pockets or companies' accounts. But they are then unliekly to spend that money.
Psychologically, if the tax cut instead comes out as a reduction in price, people are more likely to buy goods and companies are more likely to buy items and services from each other. My own company last year put on hold the purchase of a major item of equipment because the VAT rise from 15-20% made it uneconomical for us to buy it.
If there is one tax that should be cut, it is VAT, because doing so will spur economic activity and therefore growth. There is nothing at all that is more important at the moment than getting economic growth going. Nothing. Every other economic decision must be subordinated to that, otherwise, the attempts to cut the debt will be self-defeating.
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Ping!
Have a look at post 47 in this very thread.
I quote..."Banging on about the years after the war and Japan 20 years ago is not relevant to today's circumstances. The financial world has completely changed since then."
Context Billy, context. The war and Japan are 2 completely different sets of circumstances. Of course lessons can be learned from history. I'll explain in more simple terms for you. It's not relevant to base your whole argument on what happened after the war and what happened in Japan. Like I say, context Billy, context.
You'll be pleased to know I've got one almighty contradiction that you are guilty of which I'll be airing in the near future. There are many more contradictions I could point out but I'm sure the readers have already spotted them.
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Mick.
It's got sweet FA to do with context. It's about understanding of simple English.
First you say: "Banging on about the years after the war and Japan 20 years ago is not relevant to today's circumstances."
Then you bang on about an anti-Keynesian speech 36 years ago to help support your argument that Keynesianism doesn't work.
Then you say, "I haven't ever said that you can't take lessons even from 20 years ago."
But hang on a minute. Didn't you say that Japan 20 years ago was not relevant today.
So. What's the answer Mick? Can you take lessons from the past or can't you? (Or is it that you CAN take lessons from the past, but only when they support Mickonomics, and you ignore the lessons that undermine Mickonomics? Surely not Mick eh?)
If you can't take lessons from the past, then Callaghan's speech is irrelevant.
If you can take lessons from the past, then presumably, past experiences are a useful guide to what might happen today. If you don't agree with that, you need to explain in detail why the basic rules of economic analysis have changed in the last 20 or 70 years. And by that I don't just mean some airy-fairy "oh it's all global financial systems now". That is a statement, not an explanation. An explanation EXPLAINS why A leads to B. It doesn't say A has happened therefore B happens.
As an example, just to help you out. I have explained in detail how keeping Govt spending up in the current situation is utterly necessary to get growth going. I have backed up that explanation with examples of it working. I've also explained what the danger is of reducing Govt spending and explained the steps by which this leads to in-built stagnation. I've given examples of exactly this happening. THAT is what an explanation is.
So Mick. Detail. Why does the existence of global financial markets now mean that the Aggregate Demand analysis no longer applies?
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Interesting...that's three posts that have been deleted on posting in the last 2 days
Maybe the moderators have come round to my way of thinking and have started deleting your posts because they now realise that you are spouting rubbish!
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Interesting...that's three posts that have been deleted on posting in the last 2 days
Maybe the moderators have come round to my way of thinking and have started deleting your posts because they now realise that you are spouting rubbish!
Wrong again Mick, at least you`re consistent, nothing at all has been deleted by the moderators, Cow & Gate have a lot to answer for!
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You'll be pleased to know I've got one almighty contradiction that you are guilty of which I'll be airing in the near future. There are many more contradictions I could point out but I'm sure the readers have already spotted them.
Bring it on Mick. I never said I was perfect. If I've contradicted myself, then I will apologise and explain where the error is.
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Bring it on mjdgreg. I never said I was perfect. If I've contradicted myself, then I will apologise and explain where the error is.
Given your humility and acceptance that you are capable of huge contradictions I have now decided not to humiliate you. For now at least.
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Oh Mick, you are a wag.
Faced down once again. I trust that poker's not your gambling speciality?
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By the way, more support here for the argument that increasing Govt spending increases economic growth, whilst decreasing Govt spending decreases growth. This graph is what happened in the EU in 2011. The horizontal axis is change in Govt spending for each country, the vertical axis is the change in GDP.
(http://www.scottisheconomywatch.com/.a/6a015393ec64ea970b01676441f46d970b-pi)
Pretty straightforward story. Cut Govt spending and the economy flat-lines at best, contracts at worst. Increase Govt spending and the economy grows. AND, the growth is higher than the amount spent. So the overall debt as a proportion of GDP decreases. Just like it did across the world after WWII. Just Like Keynes says it will.
No history lesson. That is what is happening RIGHT NOW in Europe.
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Faced down once again. I trust that poker's not your gambling speciality?
You're asking for it. I refuse to rise to the bait because deep down I know you mean well, you are just misguided. Please don't make me do it or you may never be able to show your face around here again
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Faced down once again. I trust that poker's not your gambling speciality?
You're asking for it. I refuse to rise to the bait because deep down I know you mean well, you are just misguided. Please don't make me do it or you may never be able to show your face around here again
Please do it, don`t leave us thicko`s in suspense put that raving leftie in his place, just one thing though before you humiliate him, can you put it in your own words, rather than copy/paste, it would give you so much more credibility!
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Pretty straightforward story. Cut Govt spending and the economy re-balances to a level where everyone is at last living within their means. Increase Govt spending and the National debt increases and eventually you go bankrupt. So the overall debt as a proportion of GDP increases. Just Like Schiff says it will.
No history lesson. That is what is happening RIGHT NOW in Europe.
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Please do it, don`t leave us thicko`s in suspense put that raving leftie in his place, just one thing though before you humiliate him, can you put it in your own words, rather than copy/paste, it would give you so much more credibility!
With friends like you why would Billy need enemies. No I still can't bring myself to do it. Even though we disagree vehemently about things I do have a sneaking respect for him because he is a fighter. No matter how many times I prove him wrong he keeps on coming back for more. Respect.
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Please do it, don`t leave us thicko`s in suspense put that raving leftie in his place, just one thing though before you humiliate him, can you put it in your own words, rather than copy/paste, it would give you so much more credibility!
With friends like you why would Billy need enemies. No I still can't bring myself to do it. Even though we disagree vehemently about things I do have a sneaking respect for him because he is a fighter. No matter how many times he prove`s me wrong I keep on coming back for more. Respect.
Glad to see you`re coming round Mick, I`m sure BST accepts your apology!
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Glad to see you`re coming round Mick, I`m sure BST accepts your apology!
Even though you're nicking my jokes I have to admit you did make me laugh. Well done.
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So. How is this private sector going to thrive?
Well, you could cut taxes, give more money to business and individuals. But business already has piles of ready cash. Almost £1trillion is sitting in the bank accounts of UK businesses. That money would ordinarily be re-invested, but now businesses are scared to invest it. So giving businesses tax cuts is pointless.
If the public sector is reduced to a more sensible level then the private sector won't have to pay so much to keep it going. If taxes are cut for the private sector this will also mean they've got more money. If taxes are cut for private individuals they will also have more money. Now a combination of private companies having more money and private individuals having more money can only mean one thing. They will have to find a home for this money. Some companies and private individuals will pay off debts and rightly so. It stands to reason that even companies like this will be prepared to take more of a risk when they've got more money to play with and they can see that their customers have got more money in their pockets. Many others like me will invest and spend more money in the economy, thus creating a virtuous circle.
There are plenty of businesses that want to expand and can't get the money to do it. Having more money in the system will make it easier for them to get the money they need. It is untrue to just say no-one is spending and no businesses are wanting to invest and expand.
You also only ever seem to go on about the British consumer as the saviour of the economy if only they would spend. What about consumers in the rest of the world? Why don't you ever consider for a second that there are billions of other consumers out there that could buy stuff from us? Why do you only have the narrow view that the British consumer is the only one that can spend our way out of trouble? We did have a Commonwealth before you know. There are many other countries as well that we could sell to. Shouldn't be too hard to sell stuff to them if only we'd make the effort and stop pinning all our hopes on Europe. So I'll ask you again. Who do you trust with your money the most to make good use of it? Politicians or yourself? A one word answer will do.
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Mick.
At last, a detailed critique. Thanks. We've been waiting long enough.
Trouble is Mick, now it's even easier to pick holes in your argument. Let's begin.
If taxes are cut for private individuals they will also have more money. Now a combination of private companies having more money and private individuals having more money can only mean one thing. They will have to find a home for this money. Some companies and private individuals will pay off debts and rightly so. It stands to reason that even companies like this will be prepared to take more of a risk when they've got more money to play with and they can see that their customers have got more money in their pockets. Many others like me will invest and spend more money in the economy, thus creating a virtuous circle.
Yep. That's the idea of the Austerity Gang. If companies and individuals have more money, they will invest more and we'll get a virtuous circle going.
That is correct in normal times. But we're not in normal times. We're in the depths of the worst Depression in 80 years. And in Depressions, people and companies don't behave like that. They are scared of the future. They don't spend/invest; they hoard money. Quite understandable. I've cut back my spending. Many others have cut back their spending. Because we are worried about the future.
UK businesses are currently sitting on a larger pot of liquid money than they have ever done in history. About £75bn t the last assessment, and rising. According to your theory, they should ALREADY be investing that money in their businesses.
But hang on a minute. What does "investing in their businesses" mean? It means taking on new workers. it means building new factories, offices, plant etc. It means expanding their capability so that they can produce and sell more.
But WHO TO? The whole developed world is scraping along the bottom. Markets are not expanding. There is no demand for more output. So businesses, quite sensibly, don't invest. They sit on the money.
They leave the money in bank accounts, even though the interest rates are miserable. At times over the last year, German and American banks have offered NEGATIVE interest rates. They have charged to deposit money with them! And STILL businesses have preferred to put money into those accounts (for safety) than invest it. THAT is the scale of the problem that we have at the moment Mick. The conventional idea that it you give people money, they will spend it no longer applies.
You don't have to believe me. Look at this article in the Telegraph Business section from last year.
http://www.telegraph.co.uk/finance/economics/8718999/Business-investment-set-to-hit-record-low-amid-fears-for-UK-growth.html (http://www.telegraph.co.uk/finance/economics/8718999/Business-investment-set-to-hit-record-low-amid-fears-for-UK-growth.html)
Look at the first two paragraphs.
Business investment in Britain is heading for its lowest level on record, according to Barclays Capital, raising concerns about a key plank of the Government's growth strategy.
Figures on Friday are expected to show that companies are not spending despite the Government's best efforts to encourage corporate activity by slashing employers' National Insurance contributions and corporation tax.
Exactly what I said above. EXACTLY what Keynesian theory said 80 years ago.
QED.
I'm afraid that you fundamentally misunderstand what a deep recession/Depression is Mick. It is a basic, widespread and persistent loss of confidence in the state of the economy. You don't get out of a recession/Depression by magic. You get out of it once people and businesses start to feel optimistic about the future. You need confidence that growth will come. You'll scream about this, but you need to believe that INFLATION will come, partly because inflation goes with growth, and partly because if you think inflation is coming, you will spend now because your money will be worth less and so you will spend.
Next:
There are plenty of businesses that want to expand and can't get the money to do it. Having more money in the system will make it easier for them to get the money they need. It is untrue to just say no-one is spending and no businesses are wanting to invest and expand.
Of course it's not true that NO businesses r individuals are spending. Just not enough of them. Nowhere near enough of them.
Next.
You also only ever seem to go on about the British consumer as the saviour of the economy if only they would spend. What about consumers in the rest of the world? Why don't you ever consider for a second that there are billions of other consumers out there that could buy stuff from us? Why do you only have the narrow view that the British consumer is the only one that can spend our way out of trouble? We did have a Commonwealth before you know. There are many other countries as well that we could sell to. Shouldn't be too hard to sell stuff to them if only we'd make the effort and stop pinning all our hopes on Europe.
I agree 100%. But that is a long-run issue. We are not going to suddenly, overnight, start exporting stuff from Polypipe to villages in Thailand. That change witll take a decade or more of hard slog.
I'm talking about what we do NOW. To get out of this Depression in the next year or so. What is required is demand stimulation across the board in UK, Europe and USA. In particular for us, Europe is the key. It is vital that Germany starts to release the reins and encourage their consumers to spend. But they won't this side of next year's Election. After that, with Merkel out on her arse and a centre-left Govt in place, there is a chance. In the meantime, how utterly hypocritical of Cameron to be lecturing Germany to do exactly this (which he has been non-stop for a year now) whilst he flatly refuses to do it at home. Cameron is saying to Germany, "YOU start spending to help US out." Merkel has every right to tell him to get f***ed (even though that is the wrong decision).
Next year, centre-left Govts in France, Germany and a re-elected Obama with a renewed mandate give the developed world a chance at getting out of this hole. And that combination will put intolerable pressure on Cameron to join in. You never know. The Lib dems might even remember what platform they fought the Election on, and start putting their own pressure on Cameron for a change of policy.
So I'll ask you again. Who do you trust with your money the most to make good use of it? Politicians or yourself? A one word answer will do.
At the moment? In the current circumstances? Given that I will simply use the money to pay down my mortgage, and that will keep the economy in crisis? It is far, far beneficial for ALL of us for Govt to spend money kick starting the economy rather than give it out in tax cuts. Far better. For all the reasons I've stated.
Give us money in our pockets and we'll all feel a bit better now. We'll pay off a little bit of our debts and feel a little bit better. But that will not increase demand in the economy. It will not increase the demand for jobs. In a years time, we'll have a bit less personal debt, but the economy will still be scraping along the bottom, and in the meantime, Govt debt will have gone up, because they've given us money to pay off our personal debt. The whole stock of debt in the country will be no less than it was.
Increase Govt spending for the purpose of kick starting the economy, and we'll all be better off in 5 years.
No brainer.
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In 2007-2008 the basic problem with the UK economy was that we had too much consumption and borrowing and not enough production and saving. What happened was that a lot of British consumers basically stopped consuming and started rebuilding their savings and paying off debts, especially when they saw the equity in their homes disappearing.
Unfortunately due to interest rates being kept too low for too long, our housing bubble hasn’t burst yet, it’s just slowly deflating. I reckon there’s at least another 30% fall in house prices on the way over the next few years so consumer confidence is not going to return anytime soon. When you have the economy 70% consumption, you can’t address those imbalances without a recession.
The solution is to embrace a recession rather than try to resist one. The disease is all this debt-financed consumption. The cure is that we stop consuming and start saving and producing again. That’s called a recession. Sometimes medicine tastes bad, but you’ve got to swallow it if you want to be cured. All we’ve done since 2007-2008 is carry on in the same way as before and the basic problem still exists today.
Unless we change course as I have previously advocated, I forecast that another economic crisis will strike at the very heart of the UK economy. It will sweep through the monetary system itself and precipitate a massive sterling and Treasury bond crisis.
We still consume more than we produce and we borrow abroad, but we are never going to be able to pay this money back. Borrowing even more (if they’ll let us) is lunacy. When the economic crisis hits, your money might not be safe. The banks will not be able to withstand a big drop in the bond market because that’s what coming, and will not be bailed out again.
The solution is that we need to at last bite the bullet and raise interest rates during the recession to confront the inefficiencies. I argue that the easy money policies and the debt-based economy is what caused the problem in the first place and more of the same will only make it worse. Instead, I believe a recession is a necessary transition of the economy from a debt and consumption-based economy to a production-based economy that creates real wealth and real jobs. A recession need not be all bad. In a deflationary recession, real wages will rise because the cost of goods will fall faster.
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In 2007-2008 the basic problem with the UK economy was that we had too much consumption and borrowing and not enough production and saving. What happened was that a lot of British consumers basically stopped consuming and started rebuilding their savings and paying off debts, especially when they saw the equity in their homes disappearing.
Unfortunately due to interest rates being kept too low for too long, our housing bubble hasn’t burst yet, it’s just slowly deflating. I reckon there’s at least another 30% fall in house prices on the way over the next few years so consumer confidence is not going to return anytime soon. When you have the economy 70% consumption, you can’t address those imbalances without a recession.
The solution is to embrace a recession rather than try to resist one. The disease is all this debt-financed consumption. The cure is that we stop consuming and start saving and producing again. That’s called a recession. Sometimes medicine tastes bad, but you’ve got to swallow it if you want to be cured. All we’ve done since 2007-2008 is carry on in the same way as before and the basic problem still exists today.
Unless we change course as I have previously advocated, I forecast that another economic crisis will strike at the very heart of the UK economy. It will sweep through the monetary system itself and precipitate a massive sterling and Treasury bond crisis.
We still consume more than we produce and we borrow abroad, but we are never going to be able to pay this money back. Borrowing even more (if they’ll let us) is lunacy. When the economic crisis hits, your money might not be safe. The banks will not be able to withstand a big drop in the bond market because that’s what coming, and will not be bailed out again.
The solution is that we need to at last bite the bullet and raise interest rates during the recession to confront the inefficiencies. I argue that the easy money policies and the debt-based economy is what caused the problem in the first place and more of the same will only make it worse. Instead, I believe a recession is a necessary transition of the economy from a debt and consumption-based economy to a production-based economy that creates real wealth and real jobs. A recession need not be all bad. In a deflationary recession, real wages will rise because the cost of goods will fall faster.
Mick, you must be getting old, you keep forgetting to reference your sources. Here you go: http://unconditional.co.nz/stevekoerber/2008/12/04/how-will-the-global-financial-crisis-affect-us/
You should be careful, someone who didn't know any better might think you were just passing off other people's opinion as your own. The very idea!
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You should be careful, someone who didn't know any better might think you were just passing off other people's opinion as your own. The very idea!
You have a very vivid imagination if you think the website you refer to is the same as my post. Listen, you've already had one very serious battering from me and I advise you to just let Billy take the battering this time.
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Mick.
There's a well established name for the approach that you are proposing (or that someone is proposing and you are cutting and pasting).
It's called the "Liquidationist" concept of recessions/Depressions.
It's decades old. It was the theory back at the end of the 1800s that recessions were somehow "necessary" to purge the economy of its rottenness. It's very attractive to moralists who see recessions as being the vengeance on a world that stopped playing by the rules.
It was Herbert Hoover's approach to the start of the Great Depression. His administration held back on Govt spending even as the economy was going off a cliff, with the consequence that it fell even further and faster than it needed to do.
It was the philosophy of the Austrian economist Freidrich Hayek (Schiff's idol by the way) who said "we may perhaps prevent a crisis by checking expansion in time, but that we can do nothing to get out of it before its natural end."
It was the philosophy of another Austrian economist, Josef Schumpeter (another idol of Schiff's) who said "The “job” of a recession is to clean the “fat” out of the system."
(Interesting by the way that Schumpeter and Hayek were both active around the time of the second world war - tell us Mick. Can we take lessons from their thoughts or has the world changed so much that what they say no longer applied? Eh?)
It was the approach used in 1930 by German Chancellor Heinrich Bruning, who responded to the onset of the Great Depression by massively cutting back state spending and allowing the collapse to "do it's work" in clearing out the badness in the economy. (Can you recall what the outcome of that "work" was Mick?)
Liquidationism, the idea that recessions are needed to correct the mistakes of the recent past is a philosophy as old as the hills. It is a quasi-religious belief that the recession punishes us for our sins, and by suffering, we come out purified and redeemed.
It is also utter codswallop, and was clearly and thoroughly refuted in Keynes's work (which kept us clear of major recessions for 35 years, until the Austrian philosophy crept in with Thatcher and Reagan). Thatcher told us in 1980 that we needed to go through suffering of interest rate rises and reductions in Govt spending to purify the economy and curb inflation. Some job that did. It put unemployment up to unheard of levels for a generation, and ten years later, we still had massive inflation and lack of competitiveness.
It doesn't work. It never has worked. It sounds logical, but when you look at the detail of it, it is profoundly and frighteningly illogical. And when it HAS been applied, it has resulted in astonishing and unnecessary suffering, and in some cases, the collapse of democracy.
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You should be careful, someone who didn't know any better might think you were just passing off other people's opinion as your own. The very idea!
You have a very vivid imagination if you think the website you refer to is the same as my post.
The disease is all this debt-financed consumption. The cure is that we stop consuming and start saving and producing again. That’s called a recession. Sometimes medicine tastes bad, but you’ve got to swallow it if you want to be cured.
(Mick 2012)
vs
The disease currently afflicting the US (and most of the world) is debt finance consumption. The cure is to stop consuming and start saving and producing again. That means a recession – a normal economic phenomenon. Sometimes medicines taste bad but they must be taken.
(Steve Koerber 2008)
Spooky!
Listen, you've already had one very serious battering from me and I advise you to just let Billy take the battering this time.
Following your advice doesn't seem to be doing the British economy much good. I think I'll completely ignore it.
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Unless we change course as I have previously advocated, I forecast that another economic crisis will strike at the very heart of the UK economy. It will sweep through the monetary system itself and precipitate a massive sterling and Treasury bond crisis.
Guess what your hero Peter Schiff said at the start of 2008.
"We believe the U.S. dollar is in a major long-term bear market, and as such recommend keeping exposure to the dollar at an absolute minimum. "
Guess what happened in 2008? The dollar increased in value against other currencies by 13%. Bond rates were 4% in Jan 08, 2% in Dec 08.
Just like you Mick, he wouldn't accept when he was wrong. In Dec 2008, he said
"2008 saw one of the most unexpected rallies in the history of the U.S. dollar. However, we believe that the bottom will fall out of the Treasury market, causing a spike in bond rates and a collapse of the dollar."
Guess what's happened over the last 3 and a half years Mick? The Dollar Has had peaks and troughs as any currency does. It has never once fallen below the level that it was at when Schiff first made his prediction of collapse. It is currently where it was in mid 2008. Bonds are now at 1.5% and have been at or below 2% for the whole of the last 12 months.
Have a guess what Schiff said about inflation in early 2008.
"Unfortunately, we feel the most probable outcome is an inflationary depression, which could be more painful than the Great Depression. At that time, the burdens of unemployment and financial losses were at least offset by falling consumer prices. The worst case scenario this time, the odds of which seem to be increasing daily, involves a period of a hyper-inflation which could render the U.S. dollar, and all U.S. dollar-denominated assets, practically worthless."
Have a guess what's happened to American inflation since then...
Go on. Have a guess.
Wrong, time and time again. Schiff and the Austrians have been wrong on every single major prediction since the start of the great recession. He may well have predicted the great recession. So did many Keynesians. But his predictions since the start of the recession have been wild and wrong.
But it shouldn't surprise anyone that he keeps on hammering the same line. He runs an investment company that makes its decisions according to these guiding principles. If he turned round now and said, "You know what folks? We got the call on the dollar wrong. We got the call on inflation wrong. We got the call on band rates wrong." then who would stick with him.
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Unless we change course as I have previously advocated, I forecast that another economic crisis will strike at the very heart of the UK economy. It will sweep through the monetary system itself and precipitate a massive sterling and Treasury bond crisis.
http://ivn.us/2012/04/03/peter-schiff-who-predicted-the-financial-crisis-forecasts-the-worst-to-come-around-2013/
Have a look at that website Mick. Have a look at what your hero Peter Schiff said back in April. In fact, I'll save you the trouble. In fact, you don't really even need to look do you?
But here it is anyway. He said that he was:
forecasting another economic crisis that will strike at the very heart of the U.S. economy, sweeping through the monetary system itself and precipitating a massive U.S. dollar and Treasury bond crisis.
f**king spooky if you ask me.
By the way, in the same interview, he also said that in 2013, the USA was going to experience a DEFLATIONARY Depression. Not the HyperInflation Depression he was forecasting back in 2009.
And you ask why a serious economist like Krugman won't debate with him. Because his a gobshite demagogue f**kwit Mick. That's why.
Hang on though.
Same verbatim quotes. Same ignorance of conventional and well-proven economic theory. Same wild ideas about raising interest rates in the depths of a Depression. Same bullshit arguing style.
f**king Hell Mick, you ARE Peter Schiff aren't you? How many other personalities do you have hidden there?
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Unless we change course as I have previously advocated, I forecast that another economic crisis will strike at the very heart of the UK economy. It will sweep through the monetary system itself and precipitate a massive sterling and Treasury bond crisis.
Interesting quote there Mick. Not for its content, obviously, which is more bullshit. But for its similarity with what your hero Peter Schiff said in an interview back in March. In that interview he was:
forecasting another economic crisis that will strike at the very heart of the U.S. economy, sweeping through the monetary system itself and precipitating a massive U.S. dollar and Treasury bond crisis.
Really f***ing spooky that, don't you think. (The source for this can be found by Googling - ivn.us peter schiff - . When I try to link to that site, the message gets wiped, which makes me think that there is a very good bullshit filter on the VSC forum, because that site is full of it.)
By the way, in the same interview, Schiff said that in 2013, the US will experience a deflationary depression. Back in 2009 of course, he was saying that there would be a hyperinflationary depression. You still wonder why serious economists like Krugman won't debate with him? Because he is a gobshite demagogue. Debating with him would indicate that they take him seriously, whereas in fact he is not worth the air time. He got one prediction right and that raised him to the status of genius. Since then, he has been wrong on very single count. Period.
Hang on though. You have near identical thoughts to Schiff. You have the same rejection of conventional, well established and tested economic theory. You have the same wild and crazy ideas on how to get us out of Depression. You have the same bullshit arguing style.
f***ing hell Mick! You ARE Peter Schiff aren't you? How many more personalities do you have?
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Following your advice doesn't seem to be doing the British economy much good. I think I'll completely ignore it.
The government isn't following my excellent advice. They're continuing to spend almost as much as Labour did and the BoE hasn't got inflation under control and has no intention of getting it under control any time soon. There is a sly plan going on to devalue the currency (Quantitative Easing) and to cause inflation (Quantatitive Easing) to inflate part of the debt problem away. They're not bothered about savers in the economy or the fact that many people are facing pay cuts due to inflation. Unfortunately the general public by and large are too thick to realise what's going on.
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Forecasting what is going to happen to an economy is not an exact science. It's very difficult to predict accurately what will happen next month never mind next year. Give it another few years and I'm sure you'll be eating your words and the broad thrust of what I am saying will come to pass.
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On the 2nd August 2002 your god Krugman stated the following:
'The basic point is that the recession of 2001 wasn't a typical postwar slump, brought on when an inflation-fighting Fed raises interest rates and easily ended by a snapback in housing and consumer spending when the Fed brings rates back down again. This was a prewar-style recession, a morning after brought on by irrational exuberance. To fight this recession the Fed needs more than a snapback; it needs soaring household spending to offset moribund business investment. And to do that, as Paul McCulley of Pimco put it, Alan Greenspan needs to create a housing bubble to replace the Nasdaq bubble.'
Great advice. Create a housing bubble ffs. That's exactly what got America into the terrible mess they are still in.
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Forecasting what is going to happen to an economy is not an exact science. It's very difficult to predict accurately what will happen next month never mind next year. Give it another few years and I'm sure you'll be eating your words and the broad thrust of what I am saying will come to pass.
1) How long is "another few years" Mick. Schiff has been predicting hyperinflation and collapse (or is it deflation and collapse, it's so hard to keep up with him) for nearly 5 years now. How long is the long-run. As a great man once said, "In the long-run, we are all dead."
2) Schiff has finally put his cards on the table and predicted Sodom and Gomorrah and hyper inflation and collapse (or is it deflation and collapse, it's so hard to keep up with him) for 2013. We'll see...
3) I've lost track of what the broad thrust of what you're saying is, and what is plagiarised selections from Google. You know what happens to people who try that stunt at Universities Mick, the places where people are taught how to marshal facts, craft and defend an argument and make contributions to the sum of human knowledge? People who pass off others' ideas as their own are booted out on the spot.
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I've lost track of what the broad thrust of what you're saying
It's very easy to follow my argument. I'll summarise it as briefly as possible for you. We should stop spending and borrowing for consumption and we should start saving and producing instead. There you have it.
You believe in spending and borrowing for consumption. That's where the major difference is for both of us. I want to live within our means. You don't. I don't want to pass on the bill for our wild partying to future generations. You do. You think the markets will keep on lending us as much money as we want for as long as we want. I don't. You don't think inflation is a bad thing. I do.
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It's alright Mick. I am able to read what you post. I just don't know which bits of those posts are your thoughts and which are someone else's.
Kind of makes arguing with you pointless. Because we're not arguing with you. we're arguing with someone else's opinions. And because you only copy and paste other people's opinions, you are unable to respond to arguments that confront or flatly refute those opinions. You simply post the same opinions once again.
So. Time and again, you've been faced with evidence for why your approach (or whoever's approach it is) will not work in theory and has NEVER worked in practice. Your response is to ignore that and simply re-state your approach (or whoever's approach it is.
Time and again, you have been shown examples of why an alternative approach both works in theory and has been shown to work in practice. Your response is to say that this doesn't apply any more, and state your approach (or whoever's approach it is) all over again.
Time and again you have been shown that the predictions of hell fire and damnation that are made by you (in fact by other people and copied by you) have been wrong and shown to be wrong. You simply copy and paste more from the same people, saying, "wait and see. We WILL be right eventually."
Not much point in continuing unless you are going to harden up and start using your own brain instead of copying other people's. I can read their opinions for myself. I don't need you to copy them for me and pass them off as your own.
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Right, I've been very soft on you so far. I've let you off on many things because I feel you are well intentioned but hopelessly deluded. I'm now going to harden up and start exposing your argument ruthlessly from here on in. The gloves are off, so watch out!
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Time and again you have been shown that the predictions of hell fire and damnation that are made by you have been wrong and shown to be wrong.
Please give examples. I've only just started making predictions so it is a bit soon to be judging them and saying I was wrong.
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Time and again you have been shown that the predictions of hell fire and damnation that are made by you have been wrong and shown to be wrong.
Please give examples. I've only just started making predictions so it is a bit soon to be judging them and saying I was wrong.
Sorry Mick. Honest mistake. I got you mixed up with Peter Schiff.
Or WAS it a mistake. I'm having trouble keeping up.
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Sorry mjdgreg. Honest mistake.
Apology accepted.
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Coming soon to VSC Forum
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It's alright mjdgreg. I am able to read what you post. I just don't know which bits of those posts are your thoughts and which are someone else's.
Kind of makes arguing with you pointless. Because we're not arguing with you. we're arguing with someone else's opinions.
It's a bit rich of you to accuse me of having multiple personalities when you're the one switching between between 'I' and 'we'. I'm starting to get worried about your sanity.
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Time for a little history lesson. Let's go back to just before the election. Here's a very interesting article from the Labour supporting Guardian.
http://www.guardian.co.uk/business/2010/may/05/uk-budget-deficit-worse-than-greece
Here are the key points from the article:
Whoever wins the election must make sorting out the public finances the top priority, the European commission warned on the eve of the poll.
The commission's spring economic forecasts put the UK deficit for this calendar year at 12% of GDP, the highest of all 27 EU nations.
Worries about Britain's public finances – in their worst state since the end of the second world war – continue to unnerve financial markets.
"The first thing for the new government to do is to agree on a convincing, ambitious programme of fiscal consolidation in order to start to reduce the very high deficit and stabilise the high debt level of the UK."
"That's by far the first and foremost challenge of the new government.''
Economists warn that if the next UK government drags its feet in reducing the deficit it could spark a downgrade from one or more of the ratings agencies that have been so swift to reassess Greece and Spain's creditworthiness.
London-based economists at BNP Paribas, have warned that the City is grossly underestimating the chance of a downgrade from the UK's current top-notch AAA status.
That, they say, could cost the taxpayer at least £10bn because of higher interest costs on government borrowing.
Let's just be grateful that Labour didn't get into power and tried to implement Billy's plan. With a deficit of 12% there was no room to implement a Keynesian stimulus to the economy even if you accept that was the right course of action (which I don't). So once again his argument is exposed as being totally flawed.
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f***ing hell Mick. Do you have the attention span of a goldfish?
We went through this yesterday.
The same agencies said exactly the same thing about Japan 20 years ago. The ratings agencies downgraded Japan 10 years ago. Japan's debt has ballooned since then. Japan's bond rates have come down consistently for 20 years and are currently the lowest in history.
Similar story going on in America. America's debt is bigger than ours. They were downgraded last year. Their bond rates are currently the lowest they have ever been.
The Austrian approach can't process this. It's not supposed to happen according to their theories. So they keep on saying "Ah yes, but it WILL collapse. Just wait and see." but it doesn't happen. They've been predicting bond rate Armageddon in Japan since Jonny Muir was playing for us. And it has never happened. Why should they be right about us.
In fact, even a cursory glance at Keynesian theory predicts EXACTLY this outcome for a country with control over its own currency, in a liquidity trap recession. It's no surprise. Unless you refuse to accept that approach and insist that another theory is correct.
You know what they call people who believe in an idea despite there being no earthly evidence for it, and lots of evidence against it? Religious zealots.
By the way. Break your habit and check your facts. Go check which party the Guardian supported at the last Election.
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So are you saying that we should have borrowed even more money and taken the deficit over 12%?
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If Billy's plan was fully implemented then houses wouldn't be becoming more affordable. There'd be that much money sloshing around, the housing bubble wouldn't deflate and would probably grow even bigger. Hopefully when prices have dropped even further (I predict a further 30% fall) first-time buyers will find it easier to get a roof over their heads.
There's only so much that landlords like me can do to help out. Yes, the value of my property portfolio is going to fall quite a bit but it is already way over-valued so I am quite happy to accept this as it will mean my children can buy a house rather than having to rent one. Renting is dead money for most people and a very bad investment. Not all us right wingers are greedy and just in it for themselves like you leftie lot.
http://www.bbc.co.uk/news/uk-18839255
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By the way. Break your habit and check your facts. Go check which party the Guardian supported at the last Election.
Got me on that one. I never read any newspapers or books and always assumed the Guardian was a Labour supporter. Glad to hear they've copped themselves on and stopped supporting them.
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I never read any newspapers or books
You don't say...
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If Billy's plan was fully implemented then houses wouldn't be becoming more affordable. There'd be that much money sloshing around, the housing bubble wouldn't deflate and would probably grow even bigger. Hopefully when prices have dropped even further (I predict a further 30% fall) first-time buyers will find it easier to get a roof over their heads.
Oi. Goldfish brain. Why do you think I said that the very first thing the Govt should do as a stimulus is build many new houses? That way, as well as putting people to work, we expand the stock of houses. The chronic shortage of decent low cost housing is the key driver behind the house price increase of the last 20 years, and has encouraged a generation of leech-like speculator/landlords who add nothing of value to the economy).
Build more houses. The price comes down.
Or do the rules of supply and demand not operate in Mickonomics?
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So are you saying that we should have borrowed even more money and taken the deficit over 12%?
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Why not? For another year or two. In order to get the economy kick started. THEN you reduce the deficit, once the private sector is back on its feet. Reducing the deficit when the private sector was on its back was economically illiterate, ideologically driven madness.
Are you saying that you preferred us to rein back the deficit and flat-line the economy, as was predicted to happen and as actually HAS happened? Is that a better outcome?
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The chronic shortage of decent low cost housing is the key driver behind the house price increase of the last 20 years, and has encouraged a generation of leech-like speculator/landlords who add nothing of value to the economy).
I'll have you know that it is people like me that have made it easier for immigrants to come into the country and do the jobs that the English won't do. Buying a house is not right for these people who will one day want to go home. Mind you, the ones I've spoken to look like they like our high wages and welfare state so much that they are likely to stay.
Governments building houses to rent is not the way forward. You only end up distorting the housing market and encouraging people to rent instead of buy. How many nice council estates are there? I can't think of one. They're always rough and encourage a dependency culture.
There is no excuse for most people in Doncaster not buying their house instead of renting. IN MOST CASES IT IS CHEAPER TO BUY THAN RENT. Most of you renters out there need to cop yourselves on. It is far too easy for renters to claim welfare and expect the likes of me to pay their rent. The less social housing the better.
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Mick. I know you don't read books but there's no excuse for not reading my posts. I didn't say the Govt should build houses to rent. I said they should build houses.
Those would primarily be for sale, thus bringing house prices down.
As for distorting the markets, a country in which the average house price is more than 4 times average earnings in almost 50% of council regions is already pretty distorted. The market has clearly not worked but needs intervention to correct it.
Simple really when you read instead of assuming.
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By the way. Break your habit and check your facts. Go check which party the Guardian supported at the last Election.
Got me on that one. I never read any newspapers or books and always assumed the Guardian was a Labour supporter. Glad to hear they've copped themselves on and stopped supporting them.
It makes one wonder why you Keep copy and pasting from them, and how you came across them in the first place!
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If there's one thing guaranteed to distort the housing market it's if the government gets involved. Far better to let the housing bubble deflate a lot faster by raising interest rates now to get them back to a more affordable level. This will also sort inflation out.
It's not true that we need to build more houses. What we need to do is make use of all the ones that are standing empty. There are 79,000 in London alone.
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Why not? For another year or two. In order to get the economy kick started. THEN you reduce the deficit, once the private sector is back on its feet. Reducing the deficit when the private sector was on its back was economically illiterate, ideologically driven madness.
Are you saying that you preferred us to rein back the deficit and flat-line the economy, as was predicted to happen and as actually HAS happened? Is that a better outcome?
I'm a bit confused as to where you stand on the deficit. Even though it was heading towards 12% at the time of the election, you seem to be saying we should have spent more money and ended up with a larger deficit than 12%.
However when I discussed the deficit with you on a different thread you said:
Christ up above, here we go again. mjdgreg needing some lessons in how to do basic thinking.
Let's start with the headlines of what Lagarde of the IMF said.
"when I think back myself of May 2010 when the UK deficit was at 11%, and I try to imagine what the situation would be like today if no such fiscal consolidation programme had been decided. I shiver."
Quite. I don't think you'd find anyone who disagrees with that. You would also find no-one who had the policy of keeping that level of deficit. Labour certainly didn't have that policy.
One year after the coalition had been in office Lagarde was saying' Thank God Labour weren't in power because they weren't going to start cutting the deficit straight away. If they'd been elected I dread to think what state the county's finances would now be in.' As I pointed out to you at the time, Labour did have a policy of keeping the deficit at that level for the first year in power after the election. They were going to start cutting the deficit in the second year of their term in office. So you got that one wrong.
Can you see why I'm confused because then you were advocating cutting the deficit straight away from 11%. You said ' Quite. I don't think you'd find anyone who disagrees with that.' Whereas now you are saying that going over 12% is what we should have done and should still do. Seems like a massive contradiction to me.
I'd be grateful if you could clarify these two completely different views that you seem to hold.
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Is that it Mick? Is that you hardening up and taking the gloves off? I'm quaking...
Read the whole of my post. I said clearly that there was, and continues to be a need to balance deficit reduction with growth. I have said and continue to say that deficits must be brought down OVER THE MEDIUM TERM. Lagarde was saying that if there had been no deficit reduction plan, we would have been in trouble. I agree and I agreed then. The question always was when and how quickly. My comment in that post was addressing the fact that no one suggested that 12% deficits would go on in perpetuity. Of course they won't. They should come down once the economic recovery is established. And not before. Otherwise, reducing them is utterly self-defeating. That was why Labour would have kept the deficit higher than the Tories for longer. Because they knew then what has been proven to be the case - that reducing the deficit immediately would lead to economic growth collapsing.
By the way, why should we take the IMF word as being gospel? Why should we assume that they are correct in saying that if there wasn't a deficit reduction plan then things would have gone tits up? They have been wrong on every other prediction about the UK economy recently.
In 2009, they predicted a -0.4% contraction in the UK for 2010. They didn't believe that Brown's fiscal stimulus would work. Actual outcome? 2.1% growth, even allowing for the economy crashing into reverse in Q4 after the Coalition cuts started (remember Gideon blaming it all on the snow?)
In 2010, after the Election, they predicted that there would be 2.1% UK growth in 2011. They said that the Coalition deficit reduction plan would add confidence to the economy. Actual result? 0.6% growth as the economy went into flatline mode.
In 2011, they predicted that the UK would grow by 1.6% in 2012. Result? Well, we contracted by 0.3% in the first quarter, and even the most optimistic forecasts indicate that we flatlined at best in Q2. So we would need a pretty spectacular recovery over Summer and Autumn to come remotely close to the IMF prediction.
So, the IMF has been wrong on every call in predicting the UK performance. They didn't believe that Brown's stimulus would produce growth. It did. They didn't believe that Osborne's spending cuts would cripple growth. They have done.
Wrong at each turn. Why should we listen to them on the deficit?
Me, I've become increasingly bullish on the deficit and bond markets issue. Having spent a bit of time looking at how bond rates have moved over the last few years, I'm increasingly skeptical of the Austrian idea that we will end up in Bond Hell if we don't slash deficits as rapidly as possible. There is no evidence that this is actually the case. And, being an empirical scientist by trade, theories that are not back up by evidence go out the window for me.
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The question always was when and how quickly.
Your previous post is a load of old waffle. You clearly stated that Labour had a plan to bring the deficit under control as soon as they took office. A plan you clearly agreed with. 11% was too high. Lagarde was saying how lucky the UK was that Labour didn't win the election and that the coalition did a good job in bringing the deficit down in the first year. If they hadn't done this then she dreads to think what state we'd have been in.
You agreed with every word she said. You said Labour would have brought the deficit down to under 11% in their first year. Actually Labour's plan would have kicked in one year after they took office. 11% was the minimum Labour wanted in the first year of taking charge. YOU WERE WRONG. You wanted it to be less. Therefore you were clearly agreeing with the coalition plan not the Labour one. pmsl.
Now you are saying we should have spent even more money and took the deficit over 12%. Unbelievable contradiction. We already had the biggest deficit in the whole of Europe and you wanted us to go out on even more of a limb. You are now saying the complete opposite of what you were saying a couple of months ago. Unbelievable contradiction.
Just admit that you have changed your mind in the space of two months and admit that there is no consistency to your argument. It changes month by month whereas mine has been consistent from day one. You have conclusively been proved to be as changeable as the weather and your credibility is now at rock bottom.
Retire gracelessly from the battle and admit defeat. I have no wish to inflict further wounds on your severely tarnished reputation. It is time for someone else to step forward and receive a severe battering. You have fought well but at the end of the day you have been found to be seriously lacking in having the intellect to do battle with someone such as myself.
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Me, I've become increasingly bullshitish on the deficit and bond markets issue.
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Having spent a bit of time looking at how bond rates have moved over the last few years, I'm increasingly skeptical of the Austrian idea that we will end up in Bond Hell if we don't slash deficits as rapidly as possible. There is no evidence that this is actually the case. And, being an empirical scientist by trade, theories that are not back up by evidence go out the window for me.
As am empirical scientologist, you can find no evidence that we will end up in Bond Hell. What about Greece, Spain, Italy, Ireland, Portugal, Cyprus etc. They all got into Bond Hell despite having lower deficits than the UK. We're not slashing deficits as rapidly as possible. The coalition have only cut spending by 0.8%. They've barely scratched the surface. Fair play to George he has managed to convince nearly everyone out there (except me) that he is cutting spending like a mad man.
Nothing could be further from the truth. His policy of keeping spending at pretty much what Labour were doing is exactly the policy you want, yet you constantly criticise him for it. He has managed to fool the bond markets into thinking he is being tough and has managed to keep our Triple AAA rating and low interest rates for now at least. He should be cutting much more savagely because one day soon the markets are going to wise up and then we will be in Bond Hell.
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Lagarde was saying that if there had been no deficit reduction plan, we would have been in trouble.
She was saying that if a deficit plan hadn't been implemented immediately (not over the medium term) she dreads to think what might have happened. You agreed then, but don't agree now.
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Mick
A very great man who was right about most things once said:"When the facts change, I change my mind. What do YOU do sir?"
Two months ago, I was still unaware of the precise scale of the way that bond rates have done exactly the opposite of what the Austrians and the IMF say they must do in response to increased deficits. I have spent a long time looking at the long term trends in bond rates in many countries. And I have come to the conclusion that there is far, far more scope to put the deficit even more firmly into second place as the most urgent problem facing us.
I have always, ALWAYS said that dealing with the deficit is something that comes as a consequence of growth, not the other way round. Growth is THE most urgent thing that we need. That required us to go lighter on the deficit. No argument about that. Equally, it is silly to think that the deficit can carry in increasing indefinitely. So there is a balance to be struck between holding your nerve now and cutting in the medium term once the private sector is active again.
Previously, I WAS worried that there would be bond market problems if put off the cuts too long. I was seduced by the persuasive arguments about the correlation between debt and bond rates. But it turns out that those arguments are based on piss and waffle and a particular political ideology. The evidence, when you look at it, doesn't exist. So, your hero has been preficting Bond Armageddon for 4 and a half years, and we're further away from it that ever.
At the same time, the evidence is mounting by the week that the economy is struggling even more than anyone thought. We are on our knees with no sign whatsoever of a recovery. Even I didn't think that there would be no growth whatsoever for 2 years once the Coalition's policies kicked in. I assumed growth would be anemic, not non-existence.
So. We now see that bond rates are not a clear and present danger. We now see that the cuts have been evening devastating than we expected.
The facts have changed. I have made a slight change in my opinion over the weight that we should give to managing the deficit compared to kick starting the economy. What do YOU do Sir? Presumably, keep insisting that the Schiff/Austrian/IMF analysis is correct, despite all the evidence against it?
You ever read Aesop's fable about the ass and the cliff face? Go dig it out.
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Having spent a bit of time looking at how bond rates have moved over the last few years, I'm increasingly skeptical of the Austrian idea that we will end up in Bond Hell if we don't slash deficits as rapidly as possible. There is no evidence that this is actually the case. And, being an empirical scientist by trade, theories that are not back up by evidence go out the window for me.
As am empirical scientologist, you can find no evidence that we will end up in Bond Hell. What about Greece, Spain, Italy, Ireland, Portugal, Cyprus etc. They all got into Bond Hell despite having lower deficits than the UK. We're not slashing deficits as rapidly as possible. The coalition have only cut spending by 0.8%. They've barely scratched the surface. Fair play to George he has managed to convince nearly everyone out there (except me) that he is cutting spending like a mad man.
Nothing could be further from the truth. His policy of keeping spending at pretty much what Labour were doing is exactly the policy you want, yet you constantly criticise him for it. He has managed to fool the bond markets into thinking he is being tough and has managed to keep our Triple AAA rating and low interest rates for now at least. He should be cutting much more savagely because one day soon the markets are going to wise up and then we will be in Bond Hell.
Mick. You're a clever lad. Go and think REALLY hard about a really important difference between the economic flexibility of those countries, and that of the UK, USA and Japan (the countries for which there is no correlation between debt and bond rates). Think about it REALLY hard and see if a light bulb comes on above your head.
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f***ing hell Mick, every day is Groundhog Day in an argument with you. Every day your arguments are systematically taken apart. Every day you start afresh with the same arguments. One day you might get inside Andie McDowell's kecks, but it's a really long, slow, boring process.
1) Osborne is following Labour's spending plans? No he isn't. We went through this two days back. Even 0.8% is a huge difference. Enough to account for a quarter of a million jobs or so.
2) Triple A rating. We went through this two days back. Japan lost its AAA rating years ago. It currently has the lowest bond rates in its history. America lost it 9 months ago. It's rates have come down since then. Why do we assume that the ratings agencies are omniscient beings?
3) Bond rates will rise eventually. We went through this yesterday. If you make comments like that, you need to provide supporting evidence. You need to explain why they have not done in Japan which has a worse debt problem than us. For 20 years, Japan's bond rates have come down. You need an explanation for that Mick. You need to explain why US bond rates have fallen since they lost their AAA rating. You need to explain why our own bond rates halved between 07-10 even when (you would say) our deficit was out of control. By your analysis Mick, the markets should have taken fright 3-4 years ago. Peter Schiff lost billions for his clients in 08-09 by advising them that US bond rates were go to explode when they didn't. How long do we have to wait for you to be proved right Mick/Peter?
Ignoring arguments and simply re-stating your belief over and over again without providing supporting evidence is what religious zealots do Mick. I thought you hated religion?
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1) Osborne is following Labour's spending plans? No he isn't. We went through this two days back. Even 0.8% is a huge difference. Enough to account for a quarter of a million jobs or so.
Look, we've still got far too many unproductive public sector jobs so the last thing we need is for the government to increase our borrowings to create even more non-jobs. 0.8% is tiny in the context of what we're talking about and to argue that it is a huge amount is extremely foolish.
You are totally wrong once again about the difference in the coalition’s deficit reduction programme and the one proposed by Labour at the time of the last election. There is hardly any difference. So to keep on banging on about the coalition cutting far faster and deeper than Labour is very wide of the mark (as usual). Here's the evidence.
The 2009 Pre-Budget Report showed that Labour’s plan was to freeze TME (Total Managed Expenditure) in real terms from the years 11/12 to 14/15. A detailed analysis carried out by the Institute of Fiscal Studies found that debt interest, social security and other items coming under the heading of AME (Annually Managed Expenditure) would have risen between 11/12 – 14/15. This meant that Labour would have had to cut DEL (Departmental Expenditure Limits) in the same period by £43.8 billion or 11.4% just to avoid increasing TME.
How different is this from George’s original plan? According to HM Treasury's Public Expenditure Statistical Analyses, George proposed to cut DEL in the same period by £43.27 billion or 11.53%. So this conclusively shows that when it comes to how fast and how deep the cuts are, there's hardly any difference between what Labour was proposing and what George actually started doing. In fact now that George has extended Plan A by two years the coalition are actually cutting by a lesser amount than Labour were proposing.
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2) Triple A rating. We went through this two days back. Japan lost its AAA rating years ago. It currently has the lowest bond rates in its history. America lost it 9 months ago. It's rates have come down since then. Why do we assume that the ratings agencies are omniscient beings?
I'd much rather have a Triple A rating than not. At the moment we are living in extremely worrying times and the normal rules of the game don't apply. It is very unwise to assume that if you lose your Triple A rating your bond rates will go lower. No-one knows what the future holds (and that even includes me). All I do know is that the fundamentals are badly wrong and it is better to try and get your house in order as soon as possible to enable you to weather the turbulent storms that lie ahead.
'Why do we assume that the ratings agencies are omniscient beings?' I don't. But unfortunately for us, a lot of key decision-makers do. I am the closest thing that I have ever come across that fits the 'omniscient being' description.
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3) Bond rates will rise eventually.
At last you are starting to see sense. Nothing is more certain. What goes down must go up. Especially when there is no logic behind why it has gone down in the first place. It's not a matter of if, it's a matter of when.
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mjdgreg. You're a clever lad. Go and think REALLY hard about a really important difference between the economic flexibility of those countries, and that of the UK, USA and Japan (the countries for which there is no correlation between debt and bond rates). Think about it REALLY hard and see if a light bulb comes on above your head.
The main difference is that we can print money to devalue our currencies and increase inflation. This only puts off the day of reckoning and means we stagnate a lot longer than we should if only we were prepared to take the medicine of a short sharp recession.
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SECONDS AWAY
ROUND TWO
DING DING
:boxing: :boxing: :boxing: :boxing:
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Not from me chief. Off on holiday later this week and am too busy making sure that everyone in my company knows what they are doing before I leave.
Plus, I thought it'd be interesting to stay quiet for a while and give Mick-Peter a chance to go a full 24 hours without making a dick of himself. I didn't think he had it in him, but I take my hat off to him.
I'm off the scene for the thick end of three weeks now. I'm leaving with particularly depressing news from the IMF today, who have (once again) had to downgrade their assessment of UK growth, just like they have had to do every year since the Election. Just like some of us were predicting would happen back then. For all the reasons that I've been trying to explain over the last few days.
The IMF are now saying (again...) that they got it wrong (again), and our economy is going to flat-line for a third year. But it'll be alright next year, because next year we'll rise off the canvas and have 1.6% growth. Until we get to next year and they say "ah yeah...we got that wrong...make that 0.3% growth." And in the meantime, they insist that they have been right all along to tell the UK Govt that bringing the deficit down is the most important thing...
This last two years has been like a slow motion car crash. Anyone who has ever glanced at Keynes's work knew what would happen if deficit reduction was placed above all else. But we went right ahead and did it anyway. With the likes of the IMF backing us and telling us it will all come right if we just do the right thing.
The entire ruling class this side of the Atlantic has wilfully forgotten the single most important economic lesson that was learned in the 20th Century. If it wasn't such an important issue, if the economic future of our country wasn't at stake and if perfectly decent and employable people weren't having their lives pissed away, it'd be f**king laughable.
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Have a great time .... and doubtless Mick will have set his alarm clock and will await your return
Dont forget to bring him something nice back :evil:
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Plus, I thought it'd be interesting to stay quiet for a while and give mjdgreg a chance to go a full 24 hours without making a dick of himself. I didn't think he had it in him, but I take my hat off to him.
The reason you've stayed quiet is because you can't refute my arguments. You are the one that has made himself look a dick by contradicting yourself so conclusively on reducing the deficit in the space of less than 2 months. Fido has also made himself look a dick by being unable to find any contradictions in my posts. He was barking up the wrong tree on that one.
Now to a further contradiction. You have stated that if you were given a tax cut you would use the money to pay down your mortgage. This goes against everything you bang on about. According to you we need to be spending not paying off debt. It is hypocritical of you in the extreme to argue this point of view and then to totally go against this argument by paying down your debts. Unbelievable.
I on the other hand am the one that is spending and rescuing the economy!!! (according to you). Let's think about it for a minute. I'd didn't believe Brown when he said he had abolished boom and bust. I have never been in debt apart from a mortgage which I made an effort to pay off early. I now no longer have a mortgage. I can now live in my house 'rent free'.
I've always saved money. I used this money to buy other properties (all also mortgage free). I've also bough solar panels and will be buying another house soon just as soon as I've saved up some more money. I am saving the economy you are not. As a typical leftie you're wanting others to spend while you get your debts paid off. No wonder you have conclusively lost this debate.
We need to get a saving and production culture going in this country. Not a borrow and consume culture like the one you advocate. My strategy works. I don't have a mortgage or any debts. You do. I am spending. You're paying off your debts. It's a no brainer.
On that note, enjoy your 3 week holiday (3 weeks!!!). No doubt this will be costing a few quid and will be benefiting a foreign country. You may have been better off hardening up and not wasting this money and used it instead to pay off your debts. But then I forgot, you are a consumer not a saver. At least you'll have time to lick your wounds and come back refreshed for a further savage beating.
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Oh! So close to 48 hours, but he couldn't quite make it.
Keep your opinions on what I do with my holidays, where I go and how I finance it to yourself, you stupid, arrogant prick. You haven't got the first idea.
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I`ve got it! Who`s arrogant and has n`t got a clue? Mick?
Step forward George Gideon Osbourne! :lol:
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BST couple of things, you say you want to see more houses built for sale to reduce house prices. Well chances are that may, but then that would cause a knock on effect wouldn't it? Current householders on huge mortgages (That they should never have got) can't sell, are saddled with huge mortgages and you end up with another negative equity situation.....
Also, I'm not sure there is an issue in the housing market, supply is there it's the demand that isn't, because the reduction in prices needed to help the younger end of the market would bankrupt half the country. Surely given the size of many people's mortgages it would be crazy to implement any scheme that reduces house prices, the key is to prevent them from growing unsustainably.
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Keep your opinions on what I do with my holidays, where I go and how I finance it to yourself, you stupid, arrogant prick. You haven't got the first idea.
Bit touchy aren't we! I was merely trying to offer you some excellent advice on hardening up.
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BST couple of things, you say you want to see more houses built for sale to reduce house prices. Well chances are that may, but then that would cause a knock on effect wouldn't it? Current householders on huge mortgages (That they should never have got) can't sell, are saddled with huge mortgages and you end up with another negative equity situation.....
Also, I'm not sure there is an issue in the housing market, supply is there it's the demand that isn't, because the reduction in prices needed to help the younger end of the market would bankrupt half the country. Surely given the size of many people's mortgages it would be crazy to implement any scheme that reduces house prices, the key is to prevent them from growing unsustainably.
Unlike silly Billy you talk a lot of sense. I agree with your first paragraph and most of your second. There is a scheme in place to reduce house prices at the moment. It's called inflation. Interest rates have been kept too low for too long meaning that house prices were allowed to get out of control and give the illusion of wealth to consumers. So they went on a spending spree which is now leading to untold damage to our economy.
Our housing bubble is taking forever to deflate because of the low interest rate policy. I reckon it is going to take at least 5 years before it finally is deflated if current policies are carried on with. During this 5 years there is no way that anyone with a big mortgage is going to spend. They're going to get as much of the mortgage paid off as possible before interest rates go up in the hope that they can avoid having their house re-possessed.
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Really can't believe this thread has gone on this long now :suicide:
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I`ve got it! Who`s arrogant and has n`t got a clue? mjdgreg?
Step forward George Gideon Osbourne!
I think you'll find it is me that is by far the most arrogant one.
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Keep your opinions on what I do with my holidays, where I go and how I finance it to yourself, you stupid, arrogant prick. You haven't got the first idea.
Bit touchy aren't we! I was merely trying to offer you some excellent advice on hardening up.
Not touchy. I just despise gobshites making comments about personal situations that they know f**k all about. It shows them up for the dick heads that they are.
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BST couple of things, you say you want to see more houses built for sale to reduce house prices. Well chances are that may, but then that would cause a knock on effect wouldn't it? Current householders on huge mortgages (That they should never have got) can't sell, are saddled with huge mortgages and you end up with another negative equity situation.....
Also, I'm not sure there is an issue in the housing market, supply is there it's the demand that isn't, because the reduction in prices needed to help the younger end of the market would bankrupt half the country. Surely given the size of many people's mortgages it would be crazy to implement any scheme that reduces house prices, the key is to prevent them from growing unsustainably.
BFYP.
We have two major problems with the housing market.
1) Ther long term one - there is a chronic lack of supply in this country. That is why the house price bubble inflated in the first place. In the last ten years, whilst the population has gone up by 3 million, we have built fewer than 1.5 million new houses. That is barely enough to keep up with replacement of the old, dilapidated stock, never mind take in to account the increased population and the trend for smaller households, with more people living alone, hence requiring more housing. This was a major policy error by Labour, but follows a trend of house building not being prioritised by successive Govts. House building starts have rarely gone above 150-170,000 per year since the early 1980s. That is an unsustainably low figure and it is no surprise that we have had two house price bubbles in that time. And since the start of the current crisis, house building has utterly collapsed. In 2009-11 to just over half the very low figure that it already was.
In the last 100 years, the only times we have built so few houses was during the two world wars. There is a pressing need to increase the stock of housing in the medium term and it is becoming more urgent by the month. By not addressing this, we are laying the seeds for the next housing bubble once the economy finally does start to expand.
2) The short-term problem. There is currently an excess of marketed supply over demand because, to put it simply, the economy is f***ed. The way to address that is to get the economy back moving again.
A clear and obvious double solution is to encourage house building. This is a step towards addressing the long term lack of housing stock. In the meantime, it gets some of the hundreds of thousands of unemployed builders back into work. It helps kick-start the economy as a result. That will very quickly sort out the short-term problem in the housing market. And it makes a start at addressing the long term problem of over-inflation in the housing market due to long-term excess of demand over supply. I fully agree that it would be crazy to depress house prices by a large amount and very quickly. That wouldn't happen under the policy that I'm suggesting. It would instead be a long-term and fairly slow-acting corrector to house prices, by relatively slowly increasing supply. (I say relatively slowly, because even if you started building a quarter of a million houses per year now - which we won't - it would still take a decade to sort out the long term chronic under-supply problem.)
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I`ve got it! Who`s arrogant and has n`t got a clue? mjdgreg?
Step forward George Gideon Osbourne!
I think you'll find it is me that is by far the most arrogant one.
And both equally clueless!
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Mick.
Parting shot before I go.
1) Since the start of the crash, Austrians like your hero Peter Shciff have been prophesying imminent mega-inflation and currency collapse. It hasn't happened. Their response is - ah yeah, but it will. It reminds me of the religious freaks who sit on top of a hill waiting for the second coming of Christ, and when he doesn't come, they say, "Ah yeah, but he'll come NEXT time."
2) At the start of the crisis, Keynesian economists were predicting how an immediate stimulus would halt the rise in unemployment and boost growth without generating large internally driven rises in inflation. That is EXACTLY what happened in 09-10.
3) From 2010, Austrians like Peter Schiff have been saying that what is required is massive cuts in public spending. That is the pre-requisite for renewed growth. The places that have implements massive cuts in spending are currently the basket cases, with no sign of a recovery this side of 2020 - Ireland, Portugal, Spain. All bumping along with 1930s levels of unemployment. (Greece too, but for different reasons - that is the ONE case where there WAS a ridiculously high Govt debt before the crash and they are in a special circle of hell.)
4) When Austerity became the rage, the anti-Keynesians like the IMF blithely predicted high growth in the UK as a response to Govt cut-backs. This was always utterly illogical and frankly ignorant of the basics of macro-economics. Keynesians and those who understood their economic history were saying that at the time. Guess who was right, the way that growth has collapsed over the last 2 years?
5) The Austrians have repeatedly claimed that unless Govt spending is slashed, bond rates will explode. You have repeated this fallacy times many in here. It hasn't happened. It is a belief that is deeply ignorant of the mechanisms that produce changes in bond rates. Go and look at the long-term history of our bond rate figures. They were at their highest in the 1970s and the late 1980s, when our Govt debt was at historically low levels. When our Govt debt was very high (1945-1960 and right now) bond rates were rock bottom. The whole basic premise of your argument against Govt spending (that it will increase interest rates and cause us long term harm) is fundamentally flawed and is contradicted by both the long term and the short term historical evidence. It is a belief that comes from a political viewpoint that Govt=bad and therefore Govt spending=bad. It is demonstrably incorrect.
I'm still, after all these pages of wittering from you, STILL waiting for a single example of a country that has ever got growth kick started in a debt-induced recession without significantly increasing Govt spending. Just one. Any one will do. If you can't find one, why should anyone take your approach seriously?
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1) Since the start of the crash, Keynesians like Billy have been prophesying we're all doomed unless we spend even more money that we haven't got. Inflation and a currency collapse are the least of their worries. They believe it won't happen. But it will unless governments harden up and stop excessive borrowing for consumption. It reminds me of the scientologist freaks who sit on top of a hill waiting for the second coming of Christ, and when he doesn't come, they say, "Ah yeah, but at least we've got Billy."
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Part of the solution to the housing problem is to stop letting in so many immigrants. Since 2001 we've increased our population by 3.7m which is mainly accounted for by immigrants. These people also tend to have bigger families thus exacerbating the problem further. Well done Labour for causing more damage to our economy.
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BST couple of things, you say you want to see more houses built for sale to reduce house prices. Well chances are that may, but then that would cause a knock on effect wouldn't it? Current householders on huge mortgages (That they should never have got) can't sell, are saddled with huge mortgages and you end up with another negative equity situation.....
Also, I'm not sure there is an issue in the housing market, supply is there it's the demand that isn't, because the reduction in prices needed to help the younger end of the market would bankrupt half the country. Surely given the size of many people's mortgages it would be crazy to implement any scheme that reduces house prices, the key is to prevent them from growing unsustainably.
BFYP.
We have two major problems with the housing market.
1) Ther long term one - there is a chronic lack of supply in this country. That is why the house price bubble inflated in the first place. In the last ten years, whilst the population has gone up by 3 million, we have built fewer than 1.5 million new houses. That is barely enough to keep up with replacement of the old, dilapidated stock, never mind take in to account the increased population and the trend for smaller households, with more people living alone, hence requiring more housing. This was a major policy error by Labour, but follows a trend of house building not being prioritised by successive Govts. House building starts have rarely gone above 150-170,000 per year since the early 1980s. That is an unsustainably low figure and it is no surprise that we have had two house price bubbles in that time. And since the start of the current crisis, house building has utterly collapsed. In 2009-11 to just over half the very low figure that it already was.
In the last 100 years, the only times we have built so few houses was during the two world wars. There is a pressing need to increase the stock of housing in the medium term and it is becoming more urgent by the month. By not addressing this, we are laying the seeds for the next housing bubble once the economy finally does start to expand.
2) The short-term problem. There is currently an excess of marketed supply over demand because, to put it simply, the economy is f***ed. The way to address that is to get the economy back moving again.
A clear and obvious double solution is to encourage house building. This is a step towards addressing the long term lack of housing stock. In the meantime, it gets some of the hundreds of thousands of unemployed builders back into work. It helps kick-start the economy as a result. That will very quickly sort out the short-term problem in the housing market. And it makes a start at addressing the long term problem of over-inflation in the housing market due to long-term excess of demand over supply. I fully agree that it would be crazy to depress house prices by a large amount and very quickly. That wouldn't happen under the policy that I'm suggesting. It would instead be a long-term and fairly slow-acting corrector to house prices, by relatively slowly increasing supply. (I say relatively slowly, because even if you started building a quarter of a million houses per year now - which we won't - it would still take a decade to sort out the long term chronic under-supply problem.)
Some of that I'd agree with others I wouldn't. There isn't a huge demand for housing and there isn't going to be for quite a while yet, the damage was done when prices were allowed to rise under the previous government (I'd need a mortgage ten times my wage to buy my Dad's house). Now I'm not badly paid but what's the point in even thinking of a buying a house? I'll probably carry on renting, it suits me and it's achieveable.
As for Keynesian theory, never really been against or for it. Some of the principles make sense others don't but the big thing is that right now that's kind of irrelevant. I'm thinking back a bit now but I always thought it was built upon spending when we're struggling and running a surplus in the good times (something Brown didn't do) - can you see the gap here? The problem was never the bail outs, that was a necessity, no theory will ever come above the fact of circumstance. But we never kept enough back in the good times and carried on the borrowing, that can't continue hence we have to reign it in - sadly the public sector attempts to do this in all the wrong ways every single time.
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I'm still, after all these pages of wittering from you, STILL waiting for a single example of a country that has ever got growth kick started in a debt-induced recession without significantly increasing Govt spending. Just one. Any one will do. If you can't find one, why should anyone take your approach seriously?
When Maggie came to power in 1979 we had inflation in double figures, trade unions with too much power, unemployment increasing to a post war record and high levels of government debt that required us to borrow from the IMF. We were the sick man of Europe.
Her first policies were to tackle both inflation and the budget deficit. She raised taxes and cut government spending. Interest rates were also increased to reduce inflation. The UK emerged from recession in 1981 without resorting to a Keynesian stimulus. She sowed the seeds of a 'goldilocks' economy which was handed over to Labour only for them to squander all the hard fought for gains.
Game set and match.
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Some of that I'd agree with others I wouldn't. There isn't a huge demand for housing and there isn't going to be for quite a while yet, the damage was done when prices were allowed to rise under the previous government (I'd need a mortgage ten times my wage to buy my Dad's house). Now I'm not badly paid but what's the point in even thinking of a buying a house? I'll probably carry on renting, it suits me and it's achieveable.
As for Keynesian theory, never really been against or for it. Some of the principles make sense others don't but the big thing is that right now that's kind of irrelevant. I'm thinking back a bit now but I always thought it was built upon spending when we're struggling and running a surplus in the good times (something Brown didn't do) - can you see the gap here? The problem was never the bail outs, that was a necessity, no theory will ever come above the fact of circumstance. But we never kept enough back in the good times and carried on the borrowing, that can't continue hence we have to reign it in - sadly the public sector attempts to do this in all the wrong ways every single time.
I'd agree with most of that. Especially the bit about the public sector. Renting may be OK for you for now but I'd advise looking at buying instead. A typical mortgage for £50,000 would only cost about £275 per month.
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BST couple of things, you say you want to see more houses built for sale to reduce house prices. Well chances are that may, but then that would cause a knock on effect wouldn't it? Current householders on huge mortgages (That they should never have got) can't sell, are saddled with huge mortgages and you end up with another negative equity situation.....
Also, I'm not sure there is an issue in the housing market, supply is there it's the demand that isn't, because the reduction in prices needed to help the younger end of the market would bankrupt half the country. Surely given the size of many people's mortgages it would be crazy to implement any scheme that reduces house prices, the key is to prevent them from growing unsustainably.
BFYP.
We have two major problems with the housing market.
1) Ther long term one - there is a chronic lack of supply in this country. That is why the house price bubble inflated in the first place. In the last ten years, whilst the population has gone up by 3 million, we have built fewer than 1.5 million new houses. That is barely enough to keep up with replacement of the old, dilapidated stock, never mind take in to account the increased population and the trend for smaller households, with more people living alone, hence requiring more housing. This was a major policy error by Labour, but follows a trend of house building not being prioritised by successive Govts. House building starts have rarely gone above 150-170,000 per year since the early 1980s. That is an unsustainably low figure and it is no surprise that we have had two house price bubbles in that time. And since the start of the current crisis, house building has utterly collapsed. In 2009-11 to just over half the very low figure that it already was.
In the last 100 years, the only times we have built so few houses was during the two world wars. There is a pressing need to increase the stock of housing in the medium term and it is becoming more urgent by the month. By not addressing this, we are laying the seeds for the next housing bubble once the economy finally does start to expand.
2) The short-term problem. There is currently an excess of marketed supply over demand because, to put it simply, the economy is f***ed. The way to address that is to get the economy back moving again.
A clear and obvious double solution is to encourage house building. This is a step towards addressing the long term lack of housing stock. In the meantime, it gets some of the hundreds of thousands of unemployed builders back into work. It helps kick-start the economy as a result. That will very quickly sort out the short-term problem in the housing market. And it makes a start at addressing the long term problem of over-inflation in the housing market due to long-term excess of demand over supply. I fully agree that it would be crazy to depress house prices by a large amount and very quickly. That wouldn't happen under the policy that I'm suggesting. It would instead be a long-term and fairly slow-acting corrector to house prices, by relatively slowly increasing supply. (I say relatively slowly, because even if you started building a quarter of a million houses per year now - which we won't - it would still take a decade to sort out the long term chronic under-supply problem.)
Some of that I'd agree with others I wouldn't. There isn't a huge demand for housing and there isn't going to be for quite a while yet, the damage was done when prices were allowed to rise under the previous government (I'd need a mortgage ten times my wage to buy my Dad's house). Now I'm not badly paid but what's the point in even thinking of a buying a house? I'll probably carry on renting, it suits me and it's achieveable.
As for Keynesian theory, never really been against or for it. Some of the principles make sense others don't but the big thing is that right now that's kind of irrelevant. I'm thinking back a bit now but I always thought it was built upon spending when we're struggling and running a surplus in the good times (something Brown didn't do) - can you see the gap here? The problem was never the bail outs, that was a necessity, no theory will ever come above the fact of circumstance. But we never kept enough back in the good times and carried on the borrowing, that can't continue hence we have to reign it in - sadly the public sector attempts to do this in all the wrong ways every single time.
BFYP
1) Essentially, Keynesian analysis is based on the concept of Aggregate demand. It says that the overall demand in an economy is the sum of private (individuals') expenditure, business expenditure and Government expenditure. Recessions occur when the total demand slumps, so there is not enough demand in the economy for the potential amount that the economy ought to be able to produce. What happened in 08-09 was a classic case of private and business demand collapsing.
If Govt expenditure is then also cut back, where does the demand in the economy come from?
If there is a huge reduction in demand, there is a huge reduction in the amount of goods and services being bought.
If there is a huge reduction in the amount of goods and services being bought, companies contract, reduce hours or wages and lay people off.
If companies contract and people have less money in their pockets, there is less demand in the economy.
A classic vicious circle. That is what happened in the Great Depression and Keynes's work was a response to that, giving an intellectual framework for how to ensure that you don't make the same mistakes again. It involves Government injecting demand into the economy, either by tax cuts that specifically boost demand (rather than simply give people money to pay off their debts) or by Govt going out and spending on new houses, schools, road, railways, fibre-optic systems etc.
Anyone who doesn't agree with that needs to put forward a logically coherent argument as to how else you get out of a a demand-collapse recession. The argument of the Austrian school appears to be "cut Govt spending and the Confidence Fairy will sort us all out."
The lack of demand in the housing market that you correctly identify is just the most visible symptom of the overall lack of demand in the economy as a whole. It is that lack of demand that is throttling the UK economy. And even going on the IMF's figures from yesterday (which, on previous track record, are probably overly optimistic), there is no sign whatsoever of any increase in demand coming in the near future.
We weren't supposed to be here, according to the deficit hawks. We were supposed to get the deficit under control over the first 3 years of this Govt, and a strong economic rebound would naturally occur. Aye, right. It is economic illiteracy on a criminal and historic scale.
2) We've been through this issue a hundred times about the Govt supposedly spending too much in the good times. It all comes down to what you consider to be "too much" Govt spending. There is now an accepted "fact" that Brown was a manic over-spender who left us peculiarly vulnerable to the downturn. It ignores the fact that in 2007, our Govt debt as a proportion of the country's income was lower than that of any other major industrialised country, and at historically very low levels for UK. Fact, as some people say at the end of their statements.
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I'm still, after all these pages of wittering from you, STILL waiting for a single example of a country that has ever got growth kick started in a debt-induced recession without significantly increasing Govt spending. Just one. Any one will do. If you can't find one, why should anyone take your approach seriously?
When Maggie came to power in 1979 we had inflation in double figures, trade unions with too much power, unemployment increasing to a post war record and high levels of government debt that required us to borrow from the IMF. We were the sick man of Europe.
Her first policies were to tackle both inflation and the budget deficit. She raised taxes and cut government spending. Interest rates were also increased to reduce inflation. The UK emerged from recession in 1981 without resorting to a Keynesian stimulus. She sowed the seeds of a 'goldilocks' economy which was handed over to Labour only for them to squander all the hard fought for gains.
Game set and match.
Mick. I struggle to figure out whether you really ARE clueless, or whether you just pretend.
UK debt in the late 70s was at historically low levels. When Thatcher came to power in 79, the debt-to-GDP ratio was lower than at any time in the previous 250 years, apart from a brief spell in the run-up to WWI. You really, really don't understand the bond market issue do you? You really don't understand what causes increases in the rates demanded of Governments when they go to the markets to borrow money. You really don't understand the reason why the UK couldn't borrow at affordable rates in 1976 and had to go to the IMF. Because if you did, you wouldn't say really, really daft things like this.
The 1980-81 recession had nothing whatsoever to do with the level of the country's debt. It was nothing remotely like the current recession. Those policies, which were grim enough back then would be utter suicide today, because the threat today is not inflation. It is the polar opposite of inflation.
And to say that Thatcher's policies worked in bringing us rip-roaring out of recession is utter crap. We inflicted upon ourselves the most severe recession in the industrialised world. That might just have been acceptable if we came out of it with a transformed economy. But we didn't. Were were left with near- Depression era unemployment for a decade. Our GDP measured in dollars fell from 1980-1985 and it wasn't until a manic housing bubble was generated in the mid-late 80s that GDP finally took off, only to collapse into the most severe recession in the western world in 1990-91.
So, at the end of your heroine's manic decade-long experiment in manic cutting followed by a wild boom, we had inflation, budget deficit, unemployment and interest rates all higher than when she came to power. Some f**king model to emulate eh?
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The 1980-81 recession had nothing whatsoever to do with the level of the country's debt.
Wrong again. Here's what the opening section of the link I include states were the reasons for the recession in 1980:
When Mrs Thatcher came to power in 1979, the economy was generally considered to be facing severe structural problems including:
* Inflation in double figures
* Powerful Trades unions causing wage inflation and time lost to strikes.
* Unemployment increasing to a post war record of 700,000
* High levels of government debt that required politically sensitive borrowing from the IMF.
http://econ.economicshelp.org/2007/03/uk-economy-under-mrs-thatcher-1979-1984.html
Maggie did sow the seeds for a much brighter future for the UK economy. When Clarke handed over to the last Labour government they did indeed inherit a 'goldilocks' economy which they then managed to totally screw up.
Game set and match.
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When Mrs Thatcher came to power in 1979, the economy was generally considered to be facing severe structural problems including:
* Inflation in double figures
* Powerful Trades unions causing wage inflation and time lost to strikes.
*Unemployment increasing to a post war record of 700,000
* High levels of government debt that required politically sensitive borrowing from the IMF.
http://econ.economicshelp.org/2007/03/uk-economy-under-mrs-thatcher-1979-1984.html
Maggie did sow the seeds for a much brighter future for the UK economy. When Clarke handed over to the last Labour government they did indeed inherit a 'goldilocks' economy which they then managed to totally screw up.
Game set and match.
She soon sorted that record out. 3.2 million unemployed inside no time at all.
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Well Mick, that explains a lot. You pick up scrappy little bits of un-supported opinion from sub-GSCE websites and take them as Gospel fact.
Instead of doing that Mick, why not do some real research? Why not go and dig out the figures for yourself instead of relying on second hand opinion? Why not make your own judgement, instead of scouring round the Internet for quotes to back up your pre-formed opinion?
If you are serious, you'd dig into the ONS data for example. Or past Treasury reports. But being idle, you don't even need to do that. You can look on your very own GSCE-help website.
http://www.economicshelp.org/blog/334/uk-economy/uk-national-debt/ (http://www.economicshelp.org/blog/334/uk-economy/uk-national-debt/)
I'll help you even further Mick. If you scroll down the page, you'll find this graph.
(http://4.bp.blogspot.com/_Z_3bgQQpLBE/TL_tYYSpP6I/AAAAAAAAAE4/6_NAPKhXUmg/s400/debt-gdp.jpg)
So. Go on then. By what measure did we have high Govt debt in 1979? Or in 2007 come to that?
As I say, you haven't the faintest comprehension what causes Governments to have borrowing crises. You assume it is simply a function of debt. In which case, why did we have a borrowing crisis with spiralling bond rates in 1976, but not in, say, 1960, or today?
Laughable.
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Really can't believe this thread has gone on this long now :suicide:
You and me both !
Shall we start another thread (just you and me) where you can say (for instance) "I see Mick has posted again" .... then I can say BST has replied - what a good one it is too
That will have the rest of the Forum riveted !
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Once again you base all your arguments on UK Debt as % of GDP ignoring all other factors.
The IMF only gives loans to countries that are virtually bankrupt. If that isn't an indication that you've got a debt problem then I don't know what is. Anyway here is some more evidence from another link showing we had a government debt problem in the 1970's. Hopefully the source meets with your very high standards. The link starts with the following:
JP Morgan, said that in “many” ways “the UK’s fiscal position is currently worse than observed around the IMF loan in 1976”.
The bank warns that Government debts, when compared to the total size of the economy, are higher than during the 1970s crisis.
http://www.telegraph.co.uk/finance/financialcrisis/7198359/Britains-economy-now-as-bad-as-1970s-JP-Morgan-warns.html
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Mick.
You really are a card. YOU Mick/Peter, whatever your name is. YOU quoted someone as saying that GOVERNMENT debt was an issue in the 1980-81 recession. I know you have personality issues Mick/Peter but it really was one of you who said that.
I then point out that by any historical standard, our Govt debt as a percentage of GDP in 1979 was actually very low.
You then complain that I am basing all my arguments of debt to GDP. What other way of basing the argument is there Mick/Peter when we are talking about the level of Govt debt?
And then, despite my earlier attempts to nudge you in the right direction, you can't help yourself but to go scouring the Internet for a random quote to back you up. And to cap it all, the article you quote is talking about Govt debt to GDP...
How long is it going to take for the penny to drop Mick/Peter? Just finding some other internet poster who agrees with you does not make your facts or your arguments correct. That JP Morgan quote is hardly news. Of course our fiscal position is worse than in the 1970s. Far, far, far worse. It doesn't take a genius to work that out. I agree 100%. Our Govt debt to GDP is now WAY higher than it was in the mid 70s. (Hardly surprising since in the mid 70s it was at historically low levels, as we've established from the data on the web site that you so perceptively linked to.)
And our bond rates are now ~1.5% whereas in 1976, they were pushing 20%.
What conclusion to you draw from that Mick/Peter? Go on. It's really not difficult.
You still haven't twigged yet what affects bond markets have you? Happy Googling.
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And our bond rates are now ~1.5% whereas in 1976, they were pushing 20%.
What conclusion to you draw from that ? Go on. It's really not difficult.
I know what conclusion you draw. You think that just because the bond markets are 'currently' giving us bond rates of 1.5% then our huge debt isn't a cause for concern and we can keep on merrily adding to it. In silly Billy land there is no need to look further than today. Whatever our rates are today will stay the same for many years to come so we'll be able to borrow lots more money cheaply and don't need to worry about rates going up and bankrupting us in the blink of an eye.
You assume that the bond markets have got it all worked out correctly. I don't. The bond markets are currently behaving very irrationally. We're only getting those rates for now because other countries are in a bad way as well and at the moment we are seen as a better bet thanks to Plan A. George has done a marvellous job of conning them into thinking we are a good bet. We're not. Far from it, especially if you had your way.
If Plan A were abandoned as you want, sentiment would soon change and this is where your argument falls down. You deride Plan A but then think you can use the fruits of this plan to borrow against the low bond rates that Plan A has delivered. The low rates you are so fond of would be gone like a shot if we implemented your Plan B and then where would we be? Talk about wanting to have it both ways.
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Really can't believe this thread has gone on this long now
There are a lot of people out there that like to see pompous Billy given a good battering every day by someone who doesn't read newspapers and books. That's why this thread has gone on so long. Just because he's a scientologist and likes to use big words and graphs etc. doesn't mean he's right.
It makes a refreshing change for an ordinary man in the street to stand up to him and get the better of him in every debate he has with him. Sometimes common sense and the courage of your convictions are all that's needed to bring people like Billy down a peg or two. I hope one or two of you out there have been inspired by me and will now feel more confident in putting your views across. Hopefully Billy will have learnt a lesson or two in humility and will tone down his utterings.
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Mick/Peter.
As I say. You haven't the faintest idea what drives the bond markets.
They are not doing what you, Mick/Peter, think they should (i.e. go up with debt). Therefore they are irrational.
Osborne claims that the bond rates are low because he has given the markets confidence that the UK is being well run. So let's follow that logic. When the economic crisis exploded, our GDP fell by 6% in one year and the deficit went up to 12%, bond rates halved. Presumably, according to Osborne, the bond markets must have been REALLY impressed with our economy back then, eh?
But you have a different argument Mick/Peter. You say that the markets are "currently" behaving irrationally. By "currently", I assume you mean "over the last 5 years", because our bond rates have been dropping like a stone for that time whilst our debt has doubled. Or perhaps you mean "over the last 12 years", because our debt has been rising for all that time and yet bond rates have consistently reduced? Or perhaps you mean "over 20 years", because Japan's bond rates have fallen by 5/6ths over that time whilst its debt has quadrupled? Or perhaps you mean "over the last 35 years", because our bond rates went sky high in 1976, even though our debt was at historically low levels.
Mick/Peter, your arguments can be boiled down to this.
1) This is what I believe
2) The facts don't actually support what I believe
3) But I will continue to believe it anyway because the facts will change.
See me? I'd look at all that information and think either.
1) The bond markets are permanently irrational, or
2) There is no, and never has been a direct causal link between high Govt debt and increased bond rates.
Either way, there is no evidence whatsoever for claiming that failing to reduce the debt will lead to Bond Market catastrophe. None at all.
In the meantime, failure to accept that argument is putting us through economic trauma.
I'd laugh about it, were in not for the fact that people with exactly the same approach are in power in the UK and across much of Europe. it is the tragedy of the era that we are condemning ourselves to years, if not decades of unnecessary economic grief through this sort of ideologically-driven ignorance.
I'll help you out here Mick/Peter, because I can see that you are having trouble Googling to find out what actually drives up bond rates.
Basically, bonds are the international money markets lending money to Governments. The rates that they charge come down to how the markets believe that they will get the value of their money back when they come to withdrawn.
There are therefore two, and really only two issues that affect this decision.
1) Whether they believe that a country will default. If there is a chance of a country going bust, the bond markets will up the required interest rate. It's a gamble. If I lend you money and its not rock solid certain that you'll be able to pay me back in future, I want a decent mark-up to make it worth taking the risk. That is what has happened in the Euro periphery.
2) Whether they believe that runaway inflation will eat away at the value of their loan. If they think that our inflation is going to be high over the period that they have lent us money, they will require a high interest rate to compensate, so that when they get their money back at the end of the loan, it's made enough interest to cover the inflation effect. THAT is what happened to the UK in the mid 70s. Inflation was through the roof and so bond rates went sky high.
And that is about it. Look at it that way and it all makes perfect sense. Japan's bond rates have been stubbornly low despite their massive debt because Japan can always print money to pay off its debts, and inflation has been rock bottom for 20 years.
Our bond rates are very low, because the markets don't believe that there is any chance of us not being able to pay off our debt, and because they believe that there is no prospect of high inflation any time in the next decade. In other words, the markets have effectively pencilled us in as another Japan. We're in for our own Lost Decade, because we have made EXACTLY the same stupid mistakes that Japan made back in 1990-92.
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Our bond rates are very low, because the markets don't believe that there is any chance of us not being able to pay off our debt, and because they believe that there is no prospect of high inflation any time in the next decade.
Exactly. You make my point for me although inadvertently. This is exactly why I believe the bond markets are behaving irrationally. If we adopted your policy there would be no chance of us ever being able to repay our debt and the markets would soon turn against us and increase rates. They also believe there is no prospect of high inflation any time in the next decade. Another irrational view. Your policy along with Quantitative Easing (money printing) is guaranteed to cause inflation and a devaluing of Sterling.
Like I said, you believe the current circumstances will prevail for many years. Of course they won't. You would leave us holed below the water-line whereas I would have caulked the hull and fixed the rigging allowing us to weather the financial storms ahead. That's if it's not already too late. I suspect it is, but hope I am wrong.
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Mick/Peter.
But the markets were right to fear inflation in the mid 70s. They were right to NOT fear inflation in Japan in the early 90s, despite Japan running huge deficits and running huge QE policies. They were right to not fear inflation in the UK or a threat to our ability to repay debts in the early 2000s when Govt borrowing increased. They were right not to fear inflation or a threat to our ability to repay debts in 2007-08 when Govt deficits exploded and we engaged in huge QE.
You, Peter, said in 2008 that the US Govt policy was going to lead to hyper inflation and a collapse of the dollar and bond rates exploding. The markets didn't say that. They were right Peter and you were wrong.
Why should they suddenly be wrong now? They've got the call right every single time before.
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Just to show why I suspect it is already too late, here is the shocking truth of our real National Debt with a link included to show the full horror story. For Billy to want to add to our debt is complete lunacy. Here is a brief extract:
The real national debt extends far beyond the Government’s formal measurements. It also includes substantial liabilities in relation to unfunded public sector pensions, unfunded state pensions, the Private Finance Initiative (PFI), Network Rail, nuclear decommissioning and a number of other items. Moreover, since 2007 there have been considerable additional liabilities arising from the bank bail-outs. Drawing on a wide range of official sources and independent analyses we have calculated the real national debt for every year since 2000-01:
At the end of 2009-10, the real national debt stood at £7.9 trillion, over £300,000 for every single household in Britain.
http://www.taxpayersalliance.com/realdebt.pdf
I rest my case.
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Why should they suddenly be wrong now? They've got the call right every single time before.
The reason they've got it wrong is because they are underestimating our true National Debt. There is also the logic that if you've got it right every time you are due to get it wrong sometime soon. I am not naive enough to think that just because I have got everything right that I have posted on this forum that I may get something wrong in the future. Even I do occasionally make mistakes. So if I am capable of making a mistake the bond markets certainly are as well.
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I have followed this debate with great interest and have learned a great deal from both sides of the argument. Fair play to Billy he keeps coming back for more, if it had been a boxing match the referee would have stepped in ages ago to protect him from any further punishment.
I declare the winner on points to be:
mgdgreg (congratulations)
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Wondered when Micks mate/relation would reappear!
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Ahem.
http://m.bbc.co.uk/news/business-18908882 (http://m.bbc.co.uk/news/business-18908882)
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I have followed this debate with great interest and have learned a great deal from both sides of the argument. Fair play to Billy he keeps coming back for more, if it had been a boxing match the referee would have stepped in ages ago to protect him from any further punishment.
I declare the winner on points to be:
mgdgreg (congratulations)
Thank you for your support. I'm sure you had an open mind before you started following this thread and I am pleased that you have been persuaded by the excellent case I've made. I must admit I'm surprised one of the moderators hasn't stepped in to close the thread to save poor Billy from further serious punishment. Ah well, while ever he keeps arguing I'll keep taking him apart.
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Wondered when Micks mate/relation/other personality would reappear!
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http://www.youtube.com/watch?v=xCzbdbL0XXI
Last Post PLEEEEEEAAAAAAASE
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The moral of the story is, you can win an argument simply by saying you've won over and over again. If only I'd known this when I was at uni, my dissertation would've been a doddle.
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Ahem.
http://m.bbc.co.uk/news/business-18908882
You've done it again! pmsl. Brilliant contradiction. Only a few days ago you said:
'By the way, why should we take the IMF word as being gospel? Why should we assume that they are correct in saying that if there wasn't a deficit reduction plan then things would have gone tits up? They have been wrong on every other prediction about the UK economy recently.
In 2009, they predicted a -0.4% contraction in the UK for 2010. They didn't believe that Brown's fiscal stimulus would work. Actual outcome? 2.1% growth, even allowing for the economy crashing into reverse in Q4 after the Coalition cuts started (remember Gideon blaming it all on the snow?)
In 2010, after the Election, they predicted that there would be 2.1% UK growth in 2011. They said that the Coalition deficit reduction plan would add confidence to the economy. Actual result? 0.6% growth as the economy went into flatline mode.
In 2011, they predicted that the UK would grow by 1.6% in 2012. Result? Well, we contracted by 0.3% in the first quarter, and even the most optimistic forecasts indicate that we flatlined at best in Q2. So we would need a pretty spectacular recovery over Summer and Autumn to come remotely close to the IMF prediction.
So, the IMF has been wrong on every call in predicting the UK performance. They didn't believe that Brown's stimulus would produce growth. It did. They didn't believe that Osborne's spending cuts would cripple growth. They have done.
Wrong at each turn. Why should we listen to them on the deficit?'
So how you can post a link to an IMF report is totally amazing. It doesn't even back up your argument. Best laugh I've had for ages. You were obviously in bad need of a 3 week holiday.
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The moral of the story is, you can win an argument simply by saying you've won over and over again. If only I'd known this when I was at uni, my dissertation would've been a doddle.
Sounds like you don't like my pugnacious debating style. I can live with that. People are far too modest in this country. If you win a debate hands down then you shouldn't be ashamed about proclaiming your victory. Be honest and admit that you have been persuaded by my excellent destruction of Billy's thesis.
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Sums Gordon up nicely.
http://www.youtube.com/watch?v=0650Cg60gB0
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Oh dear:
http://www.bbc.co.uk/news/business-18977084
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Oh dear:
Given the disastrous debt legacy left behind by Labour I would say we're doing very well considering. We need a recession to get the economy re-balanced and re-structured. There are still far too many public sector jobs that need to be cut and spending is nowhere near being brought under control.
My solution would be to put up interest rates and get the housing bubble deflated quickly instead of prolonging the agony. Cut taxes and spending much further and stop believing in the fantasy of borrowing for consumption.
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How long do you want it to go on for Mick?
https://twitter.com/EdConwaySky/status/228112002508263424/photo/1/large?tw_p=twt (https://twitter.com/EdConwaySky/status/228112002508263424/photo/1/large?tw_p=twt)
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How long do you want it to go on for mjdgreg?
That's an irrelevant question. How long do I think it will go on for? I don't think we'll see average growth above 2% for about 10 years. We need this rate just to stand still given the size of population. So in real terms things are not going to get any better for at least 10 years. Given that this is what is likely to happen, the sensible amongst us will prepare accordingly and not believe the bullshit spouted by politicians.
I'd be grateful if all you lefties out there stopped for a second and thought about who is to blame. If any of you have got any level of intelligence then you will quickly realise that the vast bulk of the blame lies with Gordon Brown. This is a recession made in Downing Street when he was Chancellor and then Prime Minister.
Unfortunately the only quicker way out of our mess would be if I was elected as the benevolent dictator of the country with a term of 25 years. I'd soon get things moving in the right direction.
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Who is Bob Diamond?
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Who is Bob Diamond?
Neil`s twin brother!
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Who is Bob Diamond?
I've forgotten, that's a sign of how long this thread has dragged on....
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Who is Bob Diamond?
He's a product of the last Labour government and is one of the reasons the country is bankrupt.
http://en.wikipedia.org/wiki/Bob_Diamond_(banker)
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Who is Bob Diamond?
He's a product of the last Labour government and is one of the reasons the country is bankrupt.
http://en.wikipedia.org/wiki/Bob_Diamond_(banker)
Would you like to explain to us thicko`s how Labour was involved in appointing him Goup CEO of Barclays plc?
you`ll probably ignore the question and produce some waffle and something you`ve found via google and then try to pass it off as your own words
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Would you like to explain to us thicko`s how Labour was involved in appointing him Goup CEO of Barclays plc?
Where did I say that? He was a product of the lax regulatory framework that Labour encouraged. He took reckless gambles and was dishonest with his customer's money knowing full well Gordon would bail him out if necessary. He epitomised all that was wrong with Labour's cosy relationship with the banks.
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Would you like to explain to us thicko`s how Labour was involved in appointing him Goup CEO of Barclays plc?
Where did I say that? He was a product of the lax regulatory framework that Labour encouraged. He took reckless gambles and was dishonest with his customer's money knowing full well Gordon would bail him out if necessary. He epitomised all that was wrong with Labour's cosy relationship with the banks.
And the Tories de regulated in the first place
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And the Tories de regulated in the first place
Labour were in power. Not the Tories. Labour could have tightened up regulation. They didn't. They loosened it to the point there was no point in having regulation. They are to blame. End of.
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If you dont vote you cant comment on the government, either party, for or against
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And the Tories de regulated in the first place
Labour were in power. Not the Tories. Labour could have tightened up regulation. They didn't. They loosened it to the point there was no point in having regulation. They are to blame. End of.
Right, we`re in agreement that the Tories De regulated the banks?
Now you can`t go bleating that the other party did n`t put that regulation back in place can you, when it`s de regulation you wanted in the first place, damned if you do and damned if you don`t, Cameron would have kicked a right fuss up if Labour re regulated would n`t they?
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Right, we`re in agreement that the Tories De regulated the banks?
Now you can`t go bleating that the other party did n`t put that regulation back in place can you, when it`s de regulation you wanted in the first place, damned if you do and damned if you don`t, Cameron would have kicked a right fuss up if Labour re regulated would n`t they?
I've never said I wanted de-regulation. What I do want is proper regulation. Anyway, what the Tories got up to before Labour came to power is not the issue. Labour only had 13 years to sort things out. When Labour came to power they completely changed the way the banks were regulated. So they did re-regulate as you put it. They just re-regulated in a totally inept way.
I have graphically explained where they went wrong in previous posts. The regulatory framework they put in place was useless and we are all now paying the price. Trying to pin the blame on the Tories totally misses the point. Labour were in power for 13 years. They are responsible for their actions. We are all suffering the consequences of their ineptitude.
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If you dont vote you cant comment on the government, either party, for or against
Why not? Is it now a condition of free speech that you can only exercise this right if you vote? That's a new one on me. There's no point voting in Doncaster unless you are a Labour supporter. No matter how bad the Labour council have been over the years we always end up with Labour MPs. This says a lot about the lack of political awareness of the majority of the people that vote in this town.
If I had my way there would be plenty of people in this town that would be denied the right to vote because they are clueless when it comes to politics and are a danger to the well-being of the country.
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..............starting with you
There's more to this world than Economics. It needs to be balanced with Social issues. Finding that equilibrium is the key
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..............starting with you
There's more to this world than Economics. It needs to be balanced with Social issues. Finding that equilibrium is the key
I'm not exaggerating when I say I consider my vote to be worth at least 1000 votes of the general public. People should be made to sit an exam to qualify for getting the vote. I would be quite happy to set the questions. Depending on how well you did in the exam would determine the weight your vote carried.
For example if you can't even spell your own name you would not be given the vote. If the only correct answer you gave was naming who the current Prime Minister was then your vote would be worth 1% of someone like me. There are far too many people who just vote the way they do because that's the way their mum and dad did or that's how their mates vote. Others cast their vote purely based on class prejudice and who will give them the most benefits. No wonder Labour keep getting the chance to ruin the country.
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I've forgotten, that's a sign of how long this thread has dragged on....
You seem to be inferring that this thread has gone on too long. I'm sure there are many people out there who have benefited and continue to benefit from my excellent posts that would totally disagree with you. I give out far more useful information and advice about the state of the economy than the likes of the BBC.
I also advise people what to do to protect themselves. Please feel free to ignore my advice but don't come back on here moaning in the future that you got caught with your pants down. If I have persuaded just one person to never vote Labour ever again then my time has been spent very wisely.
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There's more to this world than Economics. It needs to be balanced with Social issues. Finding that equilibrium is the key
I'm afraid that you seem to fall into the category of not qualifying for the vote. You seem to be implying that social issues are as if not more important than economics. Wrong. If you don't get the economics right first, then you can forget all about social issues. Put social issues first, then you get into the mess that the last socialist government left us in.
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If you dont vote you cant comment on the government, either party, for or against
Why not? Is it now a condition of free speech that you can only exercise this right if you vote? That's a new one on me. There's no point voting in Doncaster unless you are a Labour supporter. No matter how bad the Labour council have been over the years we always end up with Labour MPs. This says a lot about the lack of political awareness of the majority of the people that vote in this town. Not everyone on this forum lives in Doncaster
If I had my way there would be plenty of people in this town that would be denied the right to vote because they are clueless when it comes to politics and are a danger to the well-being of the country.
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If you dont vote you cant comment on the government, either party, for or against
Why not? Is it now a condition of free speech that you can only exercise this right if you vote? That's a new one on me. There's no point voting in Doncaster unless you are a Labour supporter. No matter how bad the Labour council have been over the years we always end up with Labour MPs. This says a lot about the lack of political awareness of the majority of the people that vote in this town.
If I had my way there would be plenty of people in this town that would be denied the right to vote because they are clueless when it comes to politics and are a danger to the well-being of the country.
Mick
I cannot let this pass without comment. I have taken little interest in the original thread as I have far too little time to read endless “War and Peace “ length posts …BUT ….
… you are obviously trying to wind someone else up for a debate on Politics (a bit like Wives do when they are wrong and then switch the argument to a tangent issue)
We live in a Democracy. We have free speech. People fought and died for the right to vote. One could argue they are still fighting or dying to bring Democracy** to peoples of other countries.
** (Aside : you could argue the USA and us have altogether different agendas)
The Suffragettes jumped through amazing “hoops” including one throwing themself under the Kings Horse in The Derby JUST to secure the right to vote and yet you seek to reverse all that just because people want to vote a certain way.
It IS one man and one woman one vote END OF and to say people cannot vote because the are mentally not up to it is an affront to all the people who have fought when they were disenfranchised
Lets face it --- the WHOLE Political system is corrupt but again that is an entirely different debate - and I have no wish to spend WEEKS debating this with you either because a) I have neither the time not the inclination and b) as I have said many times before we could swap points of view again and again and again and again and you would not be convinced by my arguments and I would not be swayed by yours
You may have valid points on the economy (who knows I have not read them) but your views on the qualities required to simply vote are simply flawed
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I'm sorry but if you can't spell your own name you shouldn't have the vote. If you've voted Labour more than twice in your life you should no longer have the vote as you have proved conclusively that you haven't got a clue about politics.
Democracy is not all it's cracked up to be. Give me a benevolent dictator any day of the week. Look at Egypt. They have democratic elections and the Muslims get in. Why should the biggest religious sect get to say what goes? Trust me, I know what I'm talking about.
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Wolfie, I think you are casting your grain on stoney ground there mate. It was due to the ruling classes having the same attitude as Mick that caused the suffragettes to have to organise in the first place (if Emily Davidson intended to throw herself under the horse why did she buy a return ticket?) - the French and Russian revolutions, Hitler to come to power - in fact he reminds me of a Greek autocrat who has tried to pay as little tax as possible and caused the destruction of that economy. Social issues dont matter only economics. Is that the attitude that brings countries together into recovery - nah its the attitude that starts riots & revolutions.
A benavolant dictator......hanging on a rope like Mussolini.
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So, what happnes if you have a stroke that affects your ability to write your name?
What happens if you have an accident and have a head injury that causes you to lose this basic function...
What happens if you come home from war badly injured perhaps brain damaged.. According to you and your blanket distain for people who for one reason or another cannot sign their name should give up their right to make their mark.
You might say I'm being simplistic in the extreme, but isn't that just what you are being by saying that?
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You might say I'm being simplistic in the extreme
Yes I would.
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According to you and your blanket distain for people who for one reason or another cannot sign their name should give up their right to make their mark.
I said spell not sign. As you cannot read properly I'm afraid you have also just lost the vote.
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According to you and your blanket distain for people who for one reason or another cannot sign their name should give up their right to make their mark.
I said spell not sign. As you cannot read properly I'm afraid you have also just lost the vote.
Tell that to Ben Parkinson ... who has lost his legs and other body parts to provide Afghanis with a vote each.
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Wolfie, I think you are casting your grain on stoney ground there mate. It was due to the ruling classes having the same attitude as Mick that caused the suffragettes to have to organise in the first place (if Emily Davidson intended to throw herself under the horse why did she buy a return ticket?) - the French and Russian revolutions, Hitler to come to power - in fact he reminds me of a Greek autocrat who has tried to pay as little tax as possible and caused the destruction of that economy. Social issues dont matter only economics. Is that the attitude that brings countries together into recovery - nah its the attitude that starts riots & revolutions.
A benavolant dictator......hanging on a rope like Mussolini.
Yes but he wont answer that one ... just be very selective with other posts
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Yes but he wont answer that one ... just be very selective with other posts
I've no idea why she bought a return ticket. If I knew, I would answer the only question posed in Wilts Rovers post. Beats me why you want me to answer that question anyway. There's probably only one person that could answer that and she killed herself.
If you would like to explain your comment ' just be very selective with other posts' I would be more than happy to oblige. If there are any parts of any posts you need further enlightenment on then just let me know. I pride myself on answering any question thrown at me (unlike some on here). For example, I'm still waiting for Filo to show where I've contradicted myself in nearly every post.
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Tell that to Ben Parkinson ... who has lost his legs and other body parts to provide Afghanis with a vote each.
You've lost me (and I suspect everybody else on this message board). If you think brave lads like Ben were sent to Afghanistan to provide the indigenous population with a vote each then I'm afraid you've been smoking too much wacky baccy.
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Tell that to Ben Parkinson ... who has lost his legs and other body parts to provide Afghanis with a vote each.
You've lost me (and I suspect everybody else on this message board). If you think brave lads like Ben were sent to Afghanistan to provide the indigenous population with a vote each then I'm afraid you've been smoking too much wacky baccy.
I have cut this directly and without alteration from my post only a few posts above. I was replying to your idea that seemed to suggest politically unaware voters should not be allowed to vote ! Please feel free to go back and read your initial post and then my FULL reply
We live in a Democracy. We have free speech. People fought and died for the right to vote. One could argue they are still fighting or dying to bring Democracy** to peoples of other countries.
** (Aside : you could argue the USA and us have altogether different agendas)
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So are you saying that anyone who is 18 and can breathe should be given the vote? Way too simplistic in my view. There are far too many clueless people out there that can inflict major damage on the country if that policy is followed. It needs to change.
All you have to do is look at every Labour government's legacy. They always leave the country in a financial mess. By and large it is the clueless amongst us that keep on voting for the incompetent fools. Until people are restricted from voting if they are clueless then the same old sorry state of affairs will continue.
Also democracy is a very flawed system. How would you feel if one day the Muslims outnumbered all the other faiths in this country? Would you then be happy for us to become a Muslim state just because they were the majority? What about Afghanistan? What if there is an election and the Taliban get into power because they are the majority? I thought we were supposed to be fighting the Taliban. That's how democracy can work and it is not for me. I'm not holding my breath for a sensible answer.
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Hold your breath no longer. I have given you several (ino) intelligent answers. I dare say others have done the same during your debate on Bob Diamond which I have declined to read
You are obviously an intelligent chap , eloquent , diligent , fastidious in your views BUT I cannot equate that intelligence and rationale with the issue you have "moved" this thread towards and your opinion that you should have a vote worth 1000 votes is just TOTALLY IRRATIONAL when judged against your overall persona and its views
I repeat (for the final time as I will not post another word on this thread) - We have as individuals and as a Nation fought for democracy both at home and abroad with the basic premise of one man one vote and I think it is an affront to all those who have "fought" either actively or passively to suggest some of the limitations you wish to apply are valid
Goodbye
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Mick you`re Aiden Burley are n`t you?
http://www.telegraph.co.uk/sport/olympics/london-2012/9434123/London-2012-Nazi-stag-party-MP-Aidan-Burley-attacks-multicultural-Opening-Ceremony.html
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I don't watch such drivel. Sounds to me though from what I've heard it was a load of leftie rubbish. Especially the bit on the NHS. Our healthcare system is an excellent example of how to waste a vast amount of taxpayer's money.
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(http://desmond.imageshack.us/Himg88/scaled.php?server=88&filename=punkstoposting.gif&res=landing)
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As Donnywolf has avoided the question I'll throw it out to anyone who supports democracy to answer it. If the Muslims win the biggest share of the vote in this country at some point in the future, would you be happy for them to turn the country into a Muslim state?
Another question. What if the Catholics eventually outnumber the Protestants in Northern Ireland to such a point that they decide they want to become part of Southern Ireland again. Do you let that happen? What happens to the Protestants? Do we ship them all back to the UK?
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On the question of Northern Ireland, I'm pretty sure our position is we keep it until the majority want out (same goes for the Falklands).
But then I'm just a thick Kitson lefty aren't I.
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On the question of Northern Ireland, I'm pretty sure our position is we keep it until the majority want out (same goes for the Falklands).
So all the Catholics have to do is breed faster than the Protestants and they can then get their wish to become part of a united Ireland. Hardly seems fair on the Protestants. Great system this democracy lark.
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On the question of Northern Ireland, I'm pretty sure our position is we keep it until the majority want out (same goes for the Falklands).
Out of interest why did you avoid the Muslim question?
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But then I'm just a thick c*** lefty aren't I.
If you say so. I do think you are being a bit harsh on yourself though, but I do admire your honesty.
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Thing is, not all Catholics are nationalist and not all Protestants are unionist. Not that simple.
I avoided that for no particular reason, I just felt better qualified to answer the one on NI (or rather underqualified for the former). I don't know and I don't think I would know until it came to it.
It isn't if I say so, I'm perfectly aware that you seem to feel yourself to be superior.
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Thing is, not all Catholics are nationalist and not all Protestants are unionist. Not that simple
Good answer. In fact more Catholics would now prefer to stay part of the UK than join the Republic of Ireland. They've copped themselves on and want nothing to do with the Euro. It could also have something to do with England subsidising them to the tune of over £6bn every year. They are taking us for mugs. Northern Ireland is the most subsidised region in the world. No wonder they want to keep on taking our money.
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I avoided that for no particular reason, I just felt better qualified to answer the one on NI (or rather underqualified for the former). I don't know and I don't think I would know until it came to it.
It would be too late by then. I'll take the bull by the horns and tell you what I think. There is no way on this Earth that the Muslims should be allowed to become the largest religion in this country. This must be avoided at all costs. Even if it means democracy suffers. If I had my way all religions would be banned and there would be no faith schools. If you didn't like it, tough. Go and live somewhere else where they still believe in the fantasy of some kind of God.
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It isn't if I say so, I'm perfectly aware that you seem to feel yourself to be superior.
I'm sorry if you feel this way. I prefer to think of myself as very self confident and I have a pugnacious, take no prisoners debating style. Some find this intimidating but I find it stimulates a more honest, interesting debate. I find myself getting more confident in my views as time goes on as I've yet to be proved wrong on anything. As soon as anyone does manage to achieve this feat I will be the first to admit it.
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I half agree with you there. I don't think the state should 'push' any faith - in fact, it should be totally secular, as it ever increasingly is - but I don't think it should be banned.
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I don't think the state should 'push' any faith - in fact, it should be totally secular
I could live with that.
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Having a state without religion is impossible. All religion is at heart is a set of values and lifestyle choices/commandments/laws. A fully secular state has those - in fact it generally tends to replace the religious leader icon with a secular one, Hitler/Lenin/Pol Pot being three most extreme examples. In fact in your posts mgreg - haven't you proposed impossing yourself as our great dictator? Anyway dont you fully support the immigration of Catholic-EU employees into England thus perpetuating the religious dominance in this country?
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Having a state without religion is impossible.
Wrong. If I were in charge I could make it happen. Anyone who wanted to follow their religion would be given a grant to go to another country of their choosing and would not be allowed back in unless they became an atheist.
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Anyway dont you fully support the immigration of Catholic-EU employees into England thus perpetuating the religious dominance in this country?
I don't support immigration into our over-crowded island. If I was in charge there would be an immediate withdrawal from the EU and the repatriation of foreigners would start in earnest. When I say 'British jobs for British workers' I mean it, unlike Gordon Brown who said one thing and did completely the opposite.
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Anyway dont you fully support the immigration of Catholic-EU employees into England thus perpetuating the religious dominance in this country?
I don't support immigration into our over-crowded island. If I was in charge there would be an immediate withdrawal from the EU and the repatriation of foreigners would start in earnest. When I say 'British jobs for British workers' I mean it, unlike Gordon Brown who said one thing and did completely the opposite.
Somewhere among the myriad of argumentative dross that you post you say how you prefer to recruit Polish workers rather than British. How far back are you going with the repatriations? 1, 2, 5 generations. The stone-age? Most of the England cricket team? The Sky TdF squad? Three-quarters of the PL? The Gurkhas? All the descendents of those 'foreign personel who served for us during WW2? Where are you going to build the gas chambers?
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Somewhere among the myriad of beautifully crafted prose that you post you say how you prefer to recruit Polish workers rather than British.
No I didn't. I have never recruited a Polish worker. I do believe though that in a lot of instances they make much better recruits than the indigenous population.
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How far back are you going with the repatriations?
Not very far. It would be unfair to repatriate 'foreigners' that have been here a while and to all intents and purposes are now British. What I am talking about doing is sending back all the workers that have flooded into the country in recent years from EU countries, for example the Polish. Also any non EU countries that fall into the same category.
I would also put an immediate block on any foreigner of any nationality coming here to work and live. It may have escaped your notice but the country is full and we can't afford to just keep on letting people come here just because they can get a better standard of living than in their own country. There would be exceptions, but these would be few and far between. Like I say, 'British jobs for British workers.'
I take it that you are quite happy for anyone to come and stay for as long as they want. This kind of woolly minded liberalism really makes my piss boil. It's time we started putting the indigenous population first and stopped all this politically correct nonsense.
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Given our Great land has been conquered by Vikings, Normans Romans etc, what group would you consider indigenous, pagans?
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Given our Great land has been conquered by Vikings, Normans Romans etc, what group would you consider indigenous, pagans?
It's very simple. Anyone that has been born here or has been here for a reasonable amount of time (this could be only a few years) and has reasonable grounds for staying. However what I want is for a line to be drawn in the sand now. No more immigration and send back the people referred to in my previous post as soon as possible.
We are being taken for mugs and lefties like you seem to be happy for that to continue. Ask yourself why do people come to the UK instead of the much nearer countries to where they live. Also it is morally wrong for the best people in these countries to be 'poached' by us. Their own countries are never going to get any better if their youth keeps on jumping ship.
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But not so long ago you said it is morally right for parents to do all the can to help their own children? Now when they do it - thats wrong!
And you suddenly want half our international sports people, most of the doctors and nurses, small business owners and every take-away owner to be sent to America? Are we all going to live on fish and chips? Are you going to dig the tatties?
Btw the ingineous Welsh and Irish are the true descendents of the original inhabitants of these islands. Unless your lineage goes back that far let me know when you are going, I'd like to wave you off.
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But not so long ago you said it is morally right for parents to do all the can to help their own children? Now when they do it - thats wrong!
Please explain. Where have I said that. You definitely would lose the vote for not being able to comprehend posts properly.
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And you suddenly want half our international sports people, most of the doctors and nurses, small business owners and every take-away owner to be sent to America? Are we all going to live on fish and chips? Are you going to dig the tatties?
Btw the ingineous Welsh and Irish are the true descendents of the original inhabitants of these islands. Unless your lineage goes back that far let me know when you are going, I'd like to wave you off.
Your powers of comprehension really are severely limited. How you can possibly interpret what I've said in such a ridiculous manner is a complete joke. You are obviously one of these politically correct leftie losers that thinks it's OK for anyone in the world to come to our country and live here as long as they want. You obviously couldn't care less about how hard it is for people born and bred here to find a job and the strain all these foreigners put on our public services.
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But not so long ago you said it is morally right for parents to do all the can to help their own children? Now when they do it - thats wrong!
Please explain. Where have I said that. You definitely would lose the vote for not being able to comprehend posts properly.
Given our Great land has been conquered by Vikings, Normans Romans etc, what group would you
Ask yourself why do people come to the UK .... if their youth keeps on jumping ship.
I present the evidence of the guilty partys' earlier post m'lud and therebye prove that his intellectual powers of argument are as flimsy as his fascist theories and grasp of historic reality. Guilty as charged.
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pmsl. You present no evidence whatsoever. I said nothing about parents. At first I was only going to give you a 10 year ban from voting but I'm afraid you are now getting a life-time ban.
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Now Billy's back off his 3 weeks holiday (I know 3 weeks!!! - he must have some kind of job related to the public sector), I'll be posting more evidence of why he is wrong soon.
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Mick
We can add an utter inability to do simple sums to your charge sheet of incompetences.
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mjdgreg
We can add an utter inability to do simple sums to your charge sheet of incompetences.
I think you'll find that my grasp of mathematics is far superior to yours. In all your posts about the economy none of your figures add up whereas all mine make perfect sense.
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So where do you get three weeks from then, dipshit.
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So where do you get three weeks from then
I refer you to a comment you made in a previous post on this thread.
Off on holiday later this week and am too busy making sure that everyone in my company knows what they are doing before I leave......
I'm off the scene for the thick end of three weeks now.
I'll be honest. I thought you were intelligent enough to be able to work out how many days made up 3 weeks, so didn't check the date you posted this comment to make sure you'd been away for 3 weeks. Seems like you've said one thing and then done another (again). 'Do as I say and not as I do' seems to be your mantra.
With hindsight (one of your favourite words) I was obviously giving you too much credit for being able to do basic maths. As time goes on I'm beginning to think that I have over-estimated your level of intelligence by quite a big margin. I won't make the same mistake again.
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Mick. I know you have issues with drawing logical conclusions from simple facts, but you have surpassed yourself in assuming that my previous post meant that I was having a three week holiday.
Read it again, carefully. Then explain for the readers why you came to that conclusion.
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mjdgreg
We can add an utter inability to do simple sums to your charge sheet of incompetences.
I can add an utter inability to do basic grammar to your charge sheet of 'incompetencies'. By the way, what's with using the royal 'we' instead of 'I'? It's not the first time you've done it.
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When I wished you an enjoyable 3 week (3 weeks!!!) holiday this was your somewhat touchy reply:
Keep your opinions on what I do with my holidays, where I go and how I finance it to yourself, you stupid, arrogant prick. You haven't got the first idea.
At no point did you refute the fact that you were having a 3 week holiday.
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Mick
Do you take sexual pleasure from making a public idiot of yourself?
You have incompetence (noun: lack of ability to function adequately) on several issues. Therefore you have several incompetences.
You were working on the assumption that I was using the plural of incompetency. As in pretty much every case when you drag yourself to your keyboard, your assumption was incorrect.
Tiresome in the extreme.
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When I wished you an enjoyable 3 week (3 weeks!!!) holiday this was your somewhat touchy reply:
Keep your opinions on what I do with my holidays, where I go and how I finance it to yourself, you stupid, arrogant prick. You haven't got the first idea.
At no point did you refute the fact that you were having a 3 week holiday.
Mick
What does my refutation (or lack thereof) have to do with anything? YOU stated an opinion. YOU should back it up. My refutation (or lack thereof) of your opinion has no bearing on the accuracy of your opinion.
In simple terms, if you are determined to make a prick of yourself, it's not my job to save you from yourself.
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Billy
Do you take sexual pleasure from making a public idiot of yourself?
You have (noun: lack of ability to function adequately) on several issues. Therefore you have several incompetencies.
I think you'll find that my grasp of grammar is much better than yours. There is no such word as 'incompetences'. As usual I back up everything I say. If you apologise, rest assured your apology will be accepted immediately.
http://www.wordhippo.com/what-is/the-plural-of/incompetence.html
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Jesus f**king wept man, are you determined to make an idiot of yourself?
Word-Hippo? You back up your idiocy by choosing a random website called Word Hippo? Well at least you are being consistent. Your arguing style comprises trawling round the web for some obscure website that supports your bizarre ideas, then claiming that you have been proved correct. You really don't have the first idea of how to form an argument do you? You have no comprehension of how to go about checking whether your sources have any credibility do you?
A simple first check on the credibility of Word Hippo, for example, might be to check what it says about plurals of other common nouns.
http://www.wordhippo.com/what-is/the-plural-of/head.html (http://www.wordhippo.com/what-is/the-plural-of/head.html)
http://www.wordhippo.com/what-is/the-plural-of/idiot.html (http://www.wordhippo.com/what-is/the-plural-of/idiot.html)
And when you've finished doing all that, disconnect your keyboard and let us all have a day without listening to your witless witterings.
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By the way, what's with using the royal 'we' instead of 'I'? It's not the first time you've done it.
Still waiting.
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Mick.
"We" as in first person plural. As in, anyone and everyone who reads this page. I'd have thought that to be self-evident but once again I find myself having to explain something very simple to you. Do you have learning problems?
Go check it out on Word Hippo and see how "we" is defined. It's a very simple word.
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Jesus f***ing wept man, are you determined to make an idiot of yourself?
It seems you are. I repeat, there is no such word as 'incompetences'. More proof.
http://www.spellcheck.co.uk/spellchecker.html
Just admit my grammar is better than yours and apologise. I will readily accept your apology and move on. I can't say fairer than that.
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mjdgreg
What does my refutation (or lack thereof) have to do with anything? YOU stated an opinion. YOU should back it up. My refutation (or lack thereof) of your opinion has no bearing on the accuracy of your opinion.
Look it's very simple. Given the fact that you were not going to post for 3 weeks and were going on holiday it was logical to assume that you were going on a 3 week holiday. If you'd only been going on a 2 week holiday you would have kept posting up to the day you went abroad. Having made this assumption I then tested out my logic by posting that you were going on a 3 week holiday which you did not refute.
I'm sure if I'd got that wrong you'd have been the first to let me know. You didn't, so I like all the other readers assumed you were going on a 3 week holiday, which is something that most of us can only dream about doing (not me of course).
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mjdgreg
What does my refutation (or lack thereof) have to do with anything? YOU stated an opinion. YOU should back it up. My refutation (or lack thereof) of your opinion has no bearing on the accuracy of your opinion.
Look it's very simple. Given the fact that you were not going to post for 3 weeks and were going on holiday it was logical to assume that you were going on a 3 week holiday. If you'd only been going on a 2 week holiday you would have kept posting up to the day you went abroad. Having made this assumption I then tested out my logic by posting that you were going on a 3 week holiday which you did not refute.
I'm sure if I'd got that wrong you'd have been the first to let me know. You didn't, so I like all the other readers assumed you were going on a 3 week holiday, which is something that most of us can only dream about doing (not me of course).
Us Mick? why say us when you don`t include yourself?
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Us mjdgreg? why say us when you don`t include yourself?
It's very simple. You need to take note of the two words in front of 'us'. I'll remind you what they were - 'most of'. Now if I'd said 'all of us' instead of 'most of us' you'd have a point. Unfortunately you have just succeeded in making yourself look silly. As I'm in a good mood, if you remove your post I'll remove mine so that other readers don't take the piss out of you.
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Us mjdgreg? why say us when you don`t include yourself?
It's very simple. You need to take note of the two words in front of 'us'. I'll remind you what they were - 'most of'. Now if I'd said 'all of us' instead of 'most of us' you'd have a point. Unfortunately you have just succeeded in making yourself look silly. As I'm in a good mood, if you remove your post I'll remove mine so that other readers don't take the piss out of you.
Piss off daft lad, there`s only one idiot here and it aint me!
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This proves you right about the economy how, exactly?
Mjdgreg/Marydene Rover/Mick, please stop. You're thoroughly embarrassing yourself to the point where I and probably everyone else will never take you seriously again, and resorting to arguing about the length of Billy's holiday and miniscule semantic matters is not helping at all. You're determined to be right about something, aren't you? When you log off do you sit outside shouting to the birds that they sing out of tune?
No, incompetences is not a word, but it is acceptable to coin a word in situations where everyone is fully aware what it means. For someone who claims to be always right you're fairly insecure, so this will hopefully settle you down. You were right about something, it isn't a word, no need to go making clone accounts to agree with yourself or picking internet fights with people then insisting copying swathes of text from Wikipedia is "pugnacious" of you. You have one small victory to put next to your enormous pile of failures.
I'm not going to humour you anymore, though why I did when you call experts of their fields who were proven 100% right on matters of economics "cranks" I'll never know. No doubt you'll reply to this with another strawman argument, which I'm telling you now I'm going to ignore. I also don't doubt it will end with you metaphorically sticking your fingers in your ears and yelling that you've won again, like a 5 year old would do. I won't post again in here as your extreme stupidity is actually starting to grate on me a little bit. Abandon thread. :suicide:
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Piss off daft lad, there`s only one idiot here and it aint me!
I did offer. So be it.
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mjdgreg
What does my refutation (or lack thereof) have to do with anything? YOU stated an opinion. YOU should back it up. My refutation (or lack thereof) of your opinion has no bearing on the accuracy of your opinion.
Look it's very simple. Given the fact that you were not going to post for 3 weeks and were going on holiday it was logical to assume that you were going on a 3 week holiday. If you'd only been going on a 2 week holiday you would have kept posting up to the day you went abroad. Having made this assumption I then tested out my logic by posting that you were going on a 3 week holiday which you did not refute.
I'm sure if I'd got that wrong you'd have been the first to let me know. You didn't, so I like all the other readers assumed you were going on a 3 week holiday, which is something that most of us can only dream about doing (not me of course).
Mick
I've been wondering what it is that you remind me of. It's just come to me. You're a mosquito.
Utterly without redeeming features. Persistent. Parasitical. And every time one is splatter against a wall, another one of the annoying little f**kers comes back again to annoy all and sundry.
Do you really have nothing better to do on your life than this? Do you realise how f**king stupid you make yourself look by your insistence on being a living example of Darth's Law? Do you comprehend how utterly imbecilic you look when you write your f**kwitted drivel?
Take this latest one. Go and read what I said about being off the scene for the thick end of 3 weeks, about having to make sure that my employees were all fixed up while I was away, then ask yourself why you insist on making a compete tool of yourself by continuing to talk about me taking a three week holiday.
Now. We'll all sit back and wait for the NEXT f**king annoying mosquito to come pointlessly buzzing round, eh?
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This proves you right about the economy how, exactly?
Not sure what you mean about 'This'. If you would care to elaborate, then I'll do my best to answer you.
Mjdgreg/Marydene Rover/Mick, please stop. You're thoroughly embarrassing yourself to the point where I and probably everyone else will never take you seriously again, and resorting to arguing about the length of Billy's holiday and miniscule semantic matters is not helping at all.
Billy was the one that said he hadn't had a 3 week holiday and asked me the question where had I got the 3 weeks from. I merely did him the courtesy of replying to his question. You'll notice I always do readers the courtesy of answering their questions.
No, incompetences is not a word, but it is acceptable to coin a word in situations where everyone is fully aware what it means.
I hope Billy now stops arguing the toss over that one now. You are totally wrong saying it is acceptable to coin a word in situations where everyone is fully aware what it means. What a load of hogwash. You can't just make up words when you feel like it. I'm glad I didn't get taught grammar at your school. There are rules of grammar and they are needed to stop people like you and Billy debasing the English language. I was merely trying to stop him using the non-word again to save him from further embarrassment.
For someone who claims to be always right you're fairly insecure, so this will hopefully settle you down. You were right about something, it isn't a word, no need to go making clone accounts to agree with yourself or picking internet fights with people then insisting copying swathes of text from Wikipedia is "pugnacious" of you. You have one small victory to put next to your enormous pile of failures.
Rest assured I am not insecure. I am totally confident. If you had said I was over confident then I may have considered your point of view for a nano-second before dismissing it. You also seem to be jealous of my photographic memory. If you would like to list my alleged enormous pile of failures I will go through them one by one to prove you totally wrong. I'm not holding my breath.
I'm not going to humour you anymore, though why I did when you call experts of their fields who were proven 100% right on matters of economics "cranks" I'll never know.
I think you'll find that they have not been proven to be 100% right on matters of economics. Far from it. Governments following their views is what's got us in this mess. That's why they are cranks and they are usually trying to sell a book. I am the only person I know that is 100% right about the economy and I am not trying to sell a book so you can take my views far more seriously than the cranks.
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You know what, I'm a mug. I said I wouldn't post, but I stupidly clicked back into the thread while enjoying this little game of tennis on the telly and lo and behold, I'm like a moth drawn to Mick's exceptionally dim bulb. Mick, feel free to quote this, with the "I'm a mug" part in bold text so you can get a cheap shot in. That's a free one for you.
Not sure what you mean about 'This'. If you would care to elaborate, then I'll do my best to answer you.
"This" is obviously this stupid f**king argument over some bloke's holiday or lack thereof, and subsequent argument over meaningless semantics.
Billy was the one that said he hadn't had a 3 week holiday and asked me the question where had I got the 3 weeks from. I merely did him the courtesy of replying to his question. You'll notice I always do readers the courtesy of answering their questions.
Irrelevant. You're still arguing over his holiday/break/whatever for no reason.
I hope Billy now stops arguing the toss over that one now. You are totally wrong saying it is acceptable to coin a word in situations where everyone is fully aware what it means. What a load of hogwash. You can't just make up words when you feel like it. I'm glad I didn't get taught grammar at your school. There are rules of grammar and they are needed to stop people like you and Billy debasing the English language. I was merely trying to stop him using the non-word again to save him from further embarrassment.
See, I'll take the fall on this one. This is the main reason I'm bothering to reply, as I should have clarified what I meant. It wouldn't be acceptable to just make up a word in a formal environment such as school or work. You wouldn't use contractions or first-person pronouns, either. However, in an informal environment, such as, say, debating with an imbecile on an internet messageboard, it's perfectly acceptable. By the way, I do have a degree in English, but I'm probably just a leftie crank so feel free to ignore this.
Rest assured I am not insecure. I am totally confident. If you had said I was over confident then I may have considered your point of view for a nano-second before dismissing it. You also seem to be jealous of my photographic memory. If you would like to list my alleged enormous pile of failures I will go through them one by one to prove you totally wrong. I'm not holding my breath.
Who cares whether you've got a photographic memory or not? It doesn't matter if you've got a photographic memory or if you're Guy Pearce in Memento, you're still copying verbatim from other websites (and not particularly effectively, either)!
I think you'll find that they have not been proven to be 100% right on matters of economics. Far from it. Governments following their views is what's got us in this mess. That's why they are cranks and they are usually trying to sell a book. I am the only person I know that is 100% right about the economy and I am not trying to sell a book so you can take my views far more seriously than the cranks.
Again, just feel I should clarify on this one. 100% right is probably not totally accurate as nobody is 100% right. However, the Keynesian model has proven effective in dragging economies out of deep recessions before (Google Franklin D Roosevelt unless he's just a leftie crank too, and the New Deal, and copy and paste what you find on Wikipedia if you like) and all empirical evidence suggests that it is what is required in this recession. Cutting the deficit too harshly leads to Weimar Germany, which you can also Google. Admittedly the situations aren't exactly alike as Germany was forced into paying off their debts by the Treaty of Versailles, instead of doing it out of choice as you would do, but the principle is the same: dedicating an entire economy to cutting national debt leads to disaster. I'm no expert (although clearly, neither are you) but I know an economy requires some stimulation to be kick-started. You seem to lack a simple grasp of the most basic economic laws.
Anyway, I feel like I've clarified a little more, I really am done with this ridiculous thread now. Enjoy making more strawman arguments out of it Mick, the tennis has finished now so I'm going to do something productive with my Sunday afternoon. Try and do the same, yeah?
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You know what, I'm a mug.
Fair play to you for admitting that. I totally agree.
"This" is obviously this stupid f***ing argument over some bloke's holiday or lack thereof, and subsequent argument over meaningless semantics.
I fail to see why you would think this important clarification of whether Billy had a 3 week holiday and his poor grasp of grammar meant I thought I was right about the economy. Way off at a tangent on that one I'm afraid.
Billy was the one that said he hadn't had a 3 week holiday and asked me the question where had I got the 3 weeks from. I merely did him the courtesy of replying to his question. You'll notice I always do readers the courtesy of answering their questions.
Irrelevant. You're still arguing over his holiday/break/whatever for no reason.
I don't think it's irrelevant to answer questions. That would be very impolite of me.
I hope Billy now stops arguing the toss over that one now. You are totally wrong saying it is acceptable to coin a word in situations where everyone is fully aware what it means. What a load of hogwash. You can't just make up words when you feel like it. I'm glad I didn't get taught grammar at your school. There are rules of grammar and they are needed to stop people like you and Billy debasing the English language. I was merely trying to stop him using the non-word again to save him from further embarrassment.
See, I'll take the fall on this one. This is the main reason I'm bothering to reply, as I should have clarified what I meant. It wouldn't be acceptable to just make up a word in a formal environment such as school or work. You wouldn't use contractions or first-person pronouns, either. However, in an informal environment, such as, say, debating with an imbecile on an internet messageboard, it's perfectly acceptable. By the way, I do have a degree in English, but I'm probably just a leftie crank so feel free to ignore this.
I like a man who admits he's wrong. Well done. However you then backtrack and say it's OK to debase the English language in informal environments. I bet your lecturer wouldn't agree with you. It's more important in an informal environment to maintain high standards or we would be well and truly on the slippery slope. The standard of grammar on this forum really does make my piss boil.
Rest assured I am not insecure. I am totally confident. If you had said I was over confident then I may have considered your point of view for a nano-second before dismissing it. You also seem to be jealous of my photographic memory. If you would like to list my alleged enormous pile of failures I will go through them one by one to prove you totally wrong. I'm not holding my breath.
Who cares whether you've got a photographic memory or not? It doesn't matter if you've got a photographic memory or if you're Guy Pearce in Memento, you're still copying verbatim from other websites (and not particularly effectively, either)!
Just like Billy you contradict yourself. You say I copy verbatim from other websites then in the next breath say that I don't do it particularly effectively so how can it be verbatim? pmsl. I notice you don't list any of my alleged enormous pile of failures. That's because there aren't any.
I think you'll find that they have not been proven to be 100% right on matters of economics. Far from it. Governments following their views is what's got us in this mess. That's why they are cranks and they are usually trying to sell a book. I am the only person I know that is 100% right about the economy and I am not trying to sell a book so you can take my views far more seriously than the cranks.
Again, just feel I should clarify on this one. 100% right is probably not totally accurate as nobody is 100% right. However, the Keynesian model has proven effective in dragging economies out of deep recessions before (Google Franklin D Roosevelt unless he's just a leftie crank too, and the New Deal, and copy and paste what you find on Wikipedia if you like) and all empirical evidence suggests that it is what is required in this recession. Cutting the deficit too harshly leads to Weimar Germany, which you can also Google. Admittedly the situations aren't exactly alike as Germany was forced into paying off their debts by the Treaty of Versailles, instead of doing it out of choice as you would do, but the principle is the same: dedicating an entire economy to cutting national debt leads to disaster. I'm no expert (although clearly, neither are you) but I know an economy requires some stimulation to be kick-started. You seem to lack a simple grasp of the most basic economic laws.
Well done for admitting you were wrong again! We'll just have to disagree about Keynes the crank.
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Mick
Bizarrely, this issue about the duration of my holiday actually IS germane to the rest of this thread.
See, it's really all about whether YOU Mick are capable of reading simple words, processing simple concepts and drawing robust conclusions.
Or whether you are an obsessive gobshite who makes up his mind then violently argues his position regardless of evidence.
Let's start with clearly identifiable facts. I appreciate that this is not usually your modus operandi, but it IS the way that the rest of the world tends to approach things.
So, I said the following, explaining why I wasn't going to carry on getting deeply involved in your obsessive argument:
"Off on holiday later this week and am too busy making sure that everyone in my company knows what they are doing before I leave...I'm off the scene for the thick end of three weeks."
From that, you drew the conclusion that I was taking a three week holiday. That ignored the term "thick end of" and the clear comment that I was too busy dealing with my employees before I left to be on the scene.
For the record (not that it is any if your f***ing business, but just for the record) I was away from home for exactly two weeks. One week visiting very ill relatives and one at a beach holiday.
The key point is that you took very simple facts and drew an entirely erroneous conclusion. Your mistake was compounded by later suggesting that I must have a public sector job, in blithe ignorance of what I had posted earlier about "my company". For the record (not that it is any of your f***ing business, but just for the record) I am Managing Director of a very successful SME that I founded 9 years ago and that now has a turnover of over £1million and employs a dozen high able, motivated and hard working staff.
So, there we have it. From very simple evidence, you drew entirely incorrect conclusions. You drew the conclusions that you WANTED to be correct.
One of the best lessons in logic I ever had was gained from reading that great scientific educator Carl Sagan when I was 10 or 11. He said that when he was a young NASA scientist, a well known scientist desperately wanted life to be found on Venus. He developed the following theory:
When we look at Venus through a telescope, there is nothing to be seen. Why? Because it is covered in cloud. What are clouds made of? Water. What comes out of water clouds? Rain. What does rain produce on the surface? Rivers, oceans and swamps. What do we find in oceans, rivers and swamps? Life in abundance.
Observation - there is nothing to be seen on Venus. Conclusion - Venus is teeming with life. Of course it isn't though. The clouds are sulphuric acid and the surface temperature would melt lead.
It's a very powerful little parable. It says that if you read into things what you want to see, you will invariably be wrong and in the process will make a right f***ing tit of yourself. It's a lesson I heartily recommend.
You, however, start off by deciding what you think is correct, then taking only observations and assumptions that support your pre-conceived opinions. Anything that goes against those opinions is ignored or results in imbecilic comments such as calling the two greatest economic philosophers of the 20th Century "cranks".
That sort of approach probably works with your mates. They probably think you are a really, really intelligent bloke. But you're not Mick. You are the archetype of the clever gobshite. You are good at crafting an argument against people who are not good at crafting arguments. When faced with someone who points out your errors in a methodical and calm way, you look like a fool.
You made a bit of a prick of yourself over this 3 week issue. Down inside, you know that of course. You realise that if you can draw incorrect conclusions on something so simple, your entire credibility as someone whose opinion has any worth on more complex issues is shot.
So, you do what Internet trolls the world over do. You obfuscate, ignore the issue and focus on some insignificant grammatical minutiae.
You are a buffoon Mick. You had some comic value a few months ago, but that rapidly evaporated. Now, you are simply an annoying embarrassment.
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mjdgreg
Bizarrely, this issue about the duration of my holiday actually IS germane to the rest of this thread.
See, it's really all about whether YOU Mick are capable of reading simple words, processing simple concepts and drawing robust conclusions.
Or whether you are an obsessive gobshite who makes up his mind then violently argues his position regardless of evidence.
Let's start with clearly identifiable facts. I appreciate that this is not usually your modus operandi, but it IS the way that the rest of the world tends to approach things.
So, I said the following, explaining why I wasn't going to carry on getting deeply involved in your obsessive argument:
"Off on holiday later this week and am too busy making sure that everyone in my company knows what they are doing before I leave...I'm off the scene for the thick end of three weeks."
From that, you drew the conclusion that I was taking a three week holiday. That ignored the term "thick end of" and the clear comment that I was too busy dealing with my employees before I left to be on the scene.
For the record (not that it is any if your f***ing business, but just for the record) I was away from home for exactly two weeks. One week visiting very ill relatives and one at a beach holiday.
The key point is that you took very simple facts and drew an entirely erroneous conclusion. Your mistake was compounded by later suggesting that I must have a public sector job, in blithe ignorance of what I had posted earlier about "my company". For the record (not that it is any of your f***ing business, but just for the record) I am Managing Director of a very successful SME that I founded 9 years ago and that now has a turnover of over £1million and employs a dozen high able, motivated and hard working staff.
So, there we have it. From very simple evidence, you drew entirely incorrect conclusions. You drew the conclusions that you WANTED to be correct.
The issue about whether you had a 3 week holiday or not is not relevant to the debate. It is an assumption that I made and gave you the opportunity to refute but you didn't. At the end of the day I couldn't care less whether you had a 3 week holiday or not. I do wish you'd stop going on about it. It's getting very boring.
All I know is that when I go on holiday I don't need a full week working until bedtime to get my employees up to speed before I go. They are always up to speed because I run my businesses like well-oiled machines. I could drop dead tomorrow and my businesses would be able to carry on without me. I would suggest you may benefit from time management training and a course in the art of delegation.
Then to try and use this pointless spat as evidence that all my arguments on the economy are wrong because you had a 2 week holiday not a 3 week one is laughable in the extreme. If that's the best you can do then I wouldn't bother.
You are the one that is incapable of reading simple words. You prove it again in this post. You say that I stated you must have a public sector job. I didn't say that. I said I suspect you must have a job that is related to the public sector. I suspect your business is heavily involved with the public sector and that you have previously worked in the public sector.
I draw these conclusions because you are unlike any prosperous businessman that I have ever come across in that you are a leftie socialist that is happy to pay higher taxes. I suspect the irretrievable damage done to the way you view business life was done earlier on in your working life when all you ever knew was the public sector. I suspect that your business has only kept going for so long because you deal predominantly with the public sector and as everyone knows they are a soft touch.
I am very unimpressed with a turnover of over £1million with 12 employees after 9 years. The net profit can't be very much on such a low turnover with those kind of overheads. In fact I'd be surprised if there was any net profit at all.
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employs a dozen high able, motivated and hard working staff.
You do know that you could get into trouble for supplying drugs to your employees don't you. They may well perform well in the short-term but long-term they are going to be a liability.
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One of the best lessons in logic I ever had was gained from reading that great scientific educator Carl Sagan when I was 10 or 11. He said that when he was a young NASA scientist, a well known scientist desperately wanted life to be found on Venus. He developed the following theory:
When we look at Venus through a telescope, there is nothing to be seen. Why? Because it is covered in cloud. What are clouds made of? Water. What comes out of water clouds? Rain. What does rain produce on the surface? Rivers, oceans and swamps. What do we find in oceans, rivers and swamps? Life in abundance.
Observation - there is nothing to be seen on Venus. Conclusion - Venus is teeming with life. Of course it isn't though. The clouds are sulphuric acid and the surface temperature would melt lead.
It's a very powerful little parable. It says that if you read into things what you want to see, you will invariably be wrong and in the process will make a right f***ing tit of yourself. It's a lesson I have totally ignored.
I think you have summed yourself up perfectly in the emboldened bit of your ramble.
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You, however, start off by deciding what you think is correct, then taking only observations and assumptions that support your pre-conceived opinions. Anything that goes against those opinions is ignored or results in imbecilic comments such as calling the two greatest economic philosophers of the 20th Century "cranks".
I start off by weighing up the pros and cons of all the arguments and then form my opinion. I then state my opinion and give everyone the chance to question it. I answer any question that is thrown at me and don't change my mind on the deficit every few weeks because I've forgotten that what I previously posted totally contradicts what I have recently said. I also don't totally slag off the IMF and then shortly afterwards try and use one of their reports to back up my latest change of mind.
I also don't decide what my point of view is just because some crank economist has written a book. You are the one that views everything with a leftie perspective which makes you incapable of weighing up the pros and cons. Hence you come up with a weak argument that is very easy for me to totally destroy.
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That sort of approach probably works with your mates. They probably think you are a really, really intelligent bloke. But you're not mjdgreg. You are the archetype of the clever gobshite. You are good at crafting an argument against people who are not good at crafting arguments. When faced with someone who points out your errors in a methodical and calm way, you look like a fool.
My mates don't think I'm a really, really intelligent bloke, they know I am. As do the readers of this forum.
I'm the one that points out the errors in your arguments in a calm, methodical way. You're the one that has been made to look like a fool. pmsl. You're the one that regularly resorts to insults not me. Methodical and calm is not a description that can be applied to you.
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Bzzzzz
Bzzzzz
Bzzzzzzzzzzzzzzzz
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Mick
You "couldn't care less whether I had a3 week holiday"?
And yet you mentioned it in no fewer than 5 different posts before I pulled you up?
Why did you mention it so often (once with numerous exclamation marks) if you couldn't care less about it?
As you say, you made an assumption. You were wrong. You have made equally incorrect assumptions about my business and my previous professional experience. Wrong, wrong, wrong on every score. But it won't stop you coming back and being wrong again tomorrow, I'm sure. You are attracted to making foolish, imbecilic, unsubstantiated and unsubstantiable comments as a bluebottle is attracted to a pile of shit.
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Mick, I don't want to be rude and I would not want to assume that I speak for anyone other than my self but I have to say, you don't impress me.
I can honestly say I don't think oh goody another post by Mick..
Being the one who shouts loudest by voice or keyboard doesn't make you the best. Your inability to do anything but argue and your opinion of yourself Isn't exactly attractive to read to be honest.
You make every post a battle and have taken the joy completely out of this forum for most except yourself. Now I know you are having a complete blast at your posting, but Lord you have depressed the life out of me...
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mjdgreg
You "couldn't care less whether I had a3 week holiday"?
And yet you mentioned it in no fewer than 5 different posts before I pulled you up?
Why did you mention it so often (once with numerous exclamation marks) if you couldn't care less about it?
I'll let you into a secret. Quite a few of my posts are designed to have a bit of humour in them. I am hilarious. You are obviously not picking up on this and instead of laughing are getting increasingly annoyed instead!!!!
This is why this thread has attracted so many views. It's not because people are interested in the economy and politics. Most of them couldn't care less. People are pissing themselves laughing at the way I've danced rings around you. Trust me, I know this to be a fact. I'd get to the doctor's and get that humour bypass operation reversed if I was you.
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mjdgreg, I don't want to be rude and I would not want to assume that I speak for anyone other than my self but I have to say, you don't impress me.
I can honestly say I don't think oh goody another post by mjdgreg..
Being the one who shouts loudest by voice or keyboard doesn't make you the best. Your inability to do anything but argue and your opinion of yourself Isn't exactly attractive to read to be honest.
You make every post a battle and have taken the joy completely out of this forum for most except yourself. Now I know you are having a complete blast at your posting, but Lord you have depressed the life out of me...
I'm not out there to impress anyone. In fact I couldn't care less what people think. As long as I know I am always right, that will do for me. I hope Billy takes on-board your advice, 'Being the one who shouts loudest by voice or keyboard doesn't make you the best'. It's obvious that I am the best.
You are entitled to your opinion and you don't have to read or respond to my posts so your loss won't be missed. It would seem there are plenty of people out there that do enjoy reading my posts. If I were you I'd get to the doctor's with Billy and get that humour bypass operation reversed.
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I'll let you into a secret. Quite a few of my posts are designed to have a bit of humour in them. I am hilarious.
I'll give you your due Mick. You've certainly excelled at keeping this particular secret well hidden. You had me totally fooled.
In fact, having gone through this thread again, I am in awe of the way that you kept your comedic genius so well hidden.
My congratulations.
If we are now able to work on the premise that nothing you say should be taken seriously, the world will be that tiny bit better for it.
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I'll give you your due mjdgreg. You've certainly excelled at keeping this particular secret well hidden. You had me totally fooled.
In fact, having gone through this thread again, I am in awe of the way that you kept your comedic genius so well hidden.
My congratulations.
Thank you. You can see why I have recommended you get yourself along to the doctor and get that humour bypass operation reversed.
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Mick - given your views on the NHS would you trust a doctor in this country to carry out a humour bypass reversal operation? Or would you recommend going private?
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mjdgreg - given your views on the NHS would you trust a doctor in this country to carry out a humour bypass reversal operation? Or would you recommend going private?
I'm pleased you agree Billy and Jucyberry need the reversal operation and I would recommend going to the doctors that did the original operations as they did such a good job they would probably be the best ones to do the reversal.
With regards to my views on the NHS I would definitely go private every time if I could afford it (which I can). Due to my healthy lifestyle though, I've never had to make the choice.
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However, the Keynesian model has proven effective in dragging economies out of deep recessions before (Google Franklin D Roosevelt unless he's just a leftie crank too, and the New Deal, and copy and paste what you find on Wikipedia if you like) and all empirical evidence suggests that it is what is required in this recession.
I can't allow this re-writing of history to go unchallenged. Here's a link that people like Billy don't want you to see. It proves conclusively that Keynes was a crank.
http://danieljmitchell.wordpress.com/2011/12/12/new-video-punctures-myths-about-great-depression-exposes-damaging-impact-of-statist-policies-by-hoover-and-fdr/
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Billy is constantly asking for examples of where austerity has worked claiming that it never has. He didn't like my offering of the UK under Maggie. Maybe he'll like this one that also shows that austerity does work and proves that his hero Krugman is a crank that uses data selectively to try and back up his ludicrous theories.
http://danieljmitchell.wordpress.com/2012/06/07/estonia-and-austerity-another-exploding-cigar-for-paul-krugman/
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Mjdgreg/Marydene Rover/Mick, please stop. You're thoroughly embarrassing yourself to the point where I and probably everyone else will never take you seriously again, and resorting to arguing about the length of Billy's holiday and miniscule semantic matters is not helping at all.
Keep me out of this I don't even know mjdgreg. Marydene Rover
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I'm flattered to be put into the same catagory as BST, he is a man I have always admired very much, so thank you for that.. :)
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Mjdgreg/Marydene Rover/Mick, please stop. You're thoroughly embarrassing yourself to the point where I and probably everyone else will never take you seriously again, and resorting to arguing about the length of Billy's holiday and miniscule semantic matters is not helping at all.
Keep me out of this I don't even know mjdgreg. Marydene Rover
Yes you do! pretty well! does n`t he Mick? ;-)
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I'm flattered to be put into the same catagory as BST, he is a man I have always admired very much, so thank you for that..
You're welcome. If I was a leftie I would also admire him.
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Mjdgreg/Marydene Rover/Mick, please stop. You're thoroughly embarrassing yourself to the point where I and probably everyone else will never take you seriously again, and resorting to arguing about the length of Billy's holiday and miniscule semantic matters is not helping at all.
Keep me out of this I don't even know mjdgreg. Marydene Rover
Yes you do! pretty well! does n`t he Mick? ;-)
As I have said I do not know Mjdgreg though I do admire his pugnacious debating style which does have some similarities to that used by Madmick when he was on the forum.
I have been accused a few times on this forum of being Madmick for the record that is not correct.
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Mjdgreg/Marydene Rover/Mick, please stop. You're thoroughly embarrassing yourself to the point where I and probably everyone else will never take you seriously again, and resorting to arguing about the length of Billy's holiday and miniscule semantic matters is not helping at all.
Keep me out of this I don't even know mjdgreg. Marydene Rover
Yes you do! pretty well! does n`t he Mick? ;-)
As I have said I do not know Mjdgreg though I do admire his pugnacious debating style which does have some similarities to that used by Madmick when he was on the forum.
I have been accused a few times on this forum of being Madmick for the record that is not correct.
I see mjdgreg (Mick) has avoided answering or confirming that he knows you very well and you know him equally well, if he did deny he knew you he would be telling porkies, unfortunately there`s no way he can confirm he does n`t know you by trawling the internet for something for him to copy and paste. I know you know each other, Mick knows it, and so do you, come on Mick, cat got yer tongue?
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I knew you wouldn't disappoint me Mick when I expectec you to continue to post selective, partisan garbage to support your opinions. You've just done it again.
Estonia. Four weeks of searching and you've come up with Estonia. Nice one.
I'll pass on the fact that you ignored a crucial part of my challenge - that you find an example of a MATURE capitalist economy which has grown out of a depression through austerity. That is actually a critical aspect of the debate, in that developing capitalist economies have very high innate growth capacity, because they can work at very low wages to service other markets. The very link you posted shows this - Estonia's GDP doubled in 10 years to 2007. Their economy is still immature with bags of growth potential due to low wages relative to strong Western economies and, all things being equal, would be expected to grow much more strongly than ours, France's or Germany's until they caught up with our standard of living and lost that competitive advantage.
But we'll ignore that issue and take on the figures at face value.
So, an indisputible fact is that Estonia experienced one of the deepest collapses in the world, with GDP collapsing by nearly 20% in 08-09. Your website writer by the way says that this occurred despite Estonia increasing Government expenditure by 18% in 2008, and implies that the depth of their economic collapse was due to this profligacy. He strongly implies that Keynesian approaches put them in trouble and Austerity pulled them out. Let's have a look at the figures then.
He gives a website which claims to support his claim. I am entirely unable to find the information which says that Estonian Government expenditure increased by 18% in 2008 on that website. Being the sort of person who takes claims as being nothing but piss and wind unless they are clearly backed up, I'd appreciate it Mick if you would point out the data to me. Otherwise, I'll assume that it is a mistake at best, or a partisan lie at worst.
What is thoroughly clear from that link is that Estonia actually ran a very, very small deficit as the crisis exploded - 2.9% of GDP in 08 and 2.0% of GDP in 2009. By comparison, the figures for the UK (which really DID run a Keynesian stimulus) were 5.0% and 11.4%. By no sensible standard can it be suggested that Estonian went Keynes-mad in 08-09. In the teeth of the hurricane of 08-09, they were effectively running Austerity from Day One. To claim otherwise is partisan mendacity.
Now. What happened as a result of those decisions in Estonia and the UK in 08-09? Well, in the UK, things were bad. We lost 6% or so of GDP and unemployment went up by about half. Not good certainly. But a f***ing cakewalk compared to Estonia. There, they lost 20% of GDP and unemployment went up four-fold. If we in the UK had done in 08-09 what Estonia did, our unemployment would have increased from 1.5M to SIX MILLION in 12 months. That is a Depression of epic proportions.
Since the depths of that self-inflicted Depression, Estonia has weakly bounced back, then stalled. The graph in the very same website that you link to show, by early 2012, their GDP growth had tailed off and their GDP was something like 25-30% below their long-term trend. Oh, and by the way, their unemployment is still three times what it was in 2007.
You call that an example of success? Really?
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By the way Mick. Remember yesterday's parable? The one that said that if you make your mind up first, then trawl round for supporting evidence and argue that black really IS white because you really, really, REALLY want it to be, then you end up looking like a right f***ing tit?
Remember that lesson. Because the writer of the website that you linked to doesn't seem to be aware of it.
He says that Estonia shows the success of Austerity. That is Estonia with an economy still 10% down on its pre-slump position and perhaps 25% down on its long-term growth position. That's Estonia that has unemployment still THREE TIMES what it was in 2007.
He says that Estonia shows Austerity works because he really, really, really wants Austerity to work. So, he's given us a standard for what he considers to be success.
But hang on a moment Mick. Because the same writer says this about the USA where a weak Keynesian stimulus was implemented in 08-09.
"It’s been nearly three years since the recession officially ended in June 2009, yet jobs are still well below their pre-recession levels. And overall economic output, or gross domestic product, has just now finally gotten back to where it was when the downturn began. This is an anemic record. Especially since an economy normally enjoys a strong bounce when coming out of a deep recession. The problem is that Obama has tried all the wrong policies. He tried a big-spending Keynesian package that was supposed to be a “stimulus,” but it's a failed approach."
http://danieljmitchell.wordpress.com/2012/03/14/the-big-debate-for-u-s-news-have-obamas-policies-helped-or-hurt-the-economy/ (http://danieljmitchell.wordpress.com/2012/03/14/the-big-debate-for-u-s-news-have-obamas-policies-helped-or-hurt-the-economy/)
As I say, when you start out by making your mind up, then argue against all logic that facts which show you to be incorrect are actually supporting you, you make a right f***ing tit of yourself.
And when you stupidly link to a fool like this to support your own argument, you look an even bigger tit.
I don't doubt for a moment that you'll take the opportunity to continue making a right f***ing tit of yourself tomorrow.
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Look, you mistake me for someone that believes austerity is the only way forward. I don't. You ask for examples where austerity has worked and I've given them to you just to keep you happy. I've not given them to you because I believe solely in austerity. You have gone off at a tangent and I am merely humouring you. To keep you even happier here's another one. The USA!
Here's the evidence that can be found in the link above in one of my earlier posts:
'America suffered a harsh depression after World War I, with GDP falling by a staggering 24 percent.
But we don’t read much about that downturn in the history books, in large part because it ended so quickly.
The key question, though, is why did that depression end quickly while the Great Depression dragged on for a decade?
One big reason for the different results is that markets were largely left unmolested in the 1920s. This meant resources could be quickly redeployed, minimizing the downturn.
But this doesn’t mean the crowd in Washington was completely passive. They did do something to help the economy recover. As Ms. Fields explains in the video, President Harding, unlike Presidents Hoover and Roosevelt, slashed government spending'.
There you have it. A rapid recovery because the government kept it's nose out and slashed government spending. Game set and match.
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Mjdgreg/Marydene Rover/Mick, please stop. You're thoroughly embarrassing yourself to the point where I and probably everyone else will never take you seriously again, and resorting to arguing about the length of Billy's holiday and miniscule semantic matters is not helping at all.
Keep me out of this I don't even know mjdgreg. Marydene Rover
Yes you do! pretty well! does n`t he Mick? ;-)
As I have said I do not know Mjdgreg though I do admire his pugnacious debating style which does have some similarities to that used by Madmick when he was on the forum.
I have been accused a few times on this forum of being Madmick for the record that is not correct.
I see mjdgreg (Mick) has avoided answering or confirming that he knows you very well and you know him equally well, if he did deny he knew you he would be telling porkies, unfortunately there`s no way he can confirm he does n`t know you by trawling the internet for something for him to copy and paste. I know you know each other, Mick knows it, and so do you, come on Mick, cat got yer tongue?
Still waiting Mick, confirm or deny that you know Marydenerover very very well, and he knows you equally well!
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Still waiting mjdgreg, confirm or deny that you know Marydenerover very very well, and he knows you equally well!
I'll make a deal with you. Quite a while ago you made the assertion that my posts were full of contradictions. I asked you to back up this claim and have been patiently waiting for weeks for you produce the evidence. So far I have heard nothing from you. Out of the hundreds of posts I've done it shouldn't be too difficult for you to find ten contradictions then I will happily answer your question.
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Still waiting mjdgreg, confirm or deny that you know Marydenerover very very well, and he knows you equally well!
I'll make a deal with you. Quite a while ago you made the assertion that my posts were full of contradictions. I asked you to back up this claim and have been patiently waiting for weeks for you produce the evidence. So far I have heard nothing from you. Out of the hundreds of posts I've done it shouldn't be too difficult for you to find ten contradictions then I will happily answer your question.
Translates into "I`m not going to answer your claim because if I tell the truth it will confirm Marydene Rover is lying and if I deny it it will confirm I`m wrong"
Of course Mick, in your warped little world you`re never wrong, so will not confirm it, you`ll just ignore the question as you are doing now, and have done throughout this and other threads.
I don`t do deals Mick, just answer the question, do you and Marydene Rover know each other very well, yes or no will do! You already know that I know the answer, but just confirm it for the benefit of the rest of the posters, confirm that you`re a fake Mick, thats all!
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Translates into "I`m not going to answer your claim because if I tell the truth it will confirm Marydene Rover is lying and if I deny it it will confirm I`m wrong"
Of course mjdgreg, in your warped little world you`re never wrong, so will not confirm it, you`ll just ignore the question as you are doing now, and have done throughout this and other threads.
I don`t do deals mjdgreg, just answer the question, do you and Marydene Rover know each other very well, yes or no will do! You already know that I know the answer, but just confirm it for the benefit of the rest of the posters, confirm that you`re a fake mjdgreg, thats all!
Translates into I can't find ten contradictions so will just keep on asking the same question and hope that nobody notices that I have made an absurd claim. Look, I'll make it even easier for you. Just admit that you can't find ten contradictions and I'll happily answer your question.
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Mick.
You display on a daily basis the classic steps of the second rate arguer.
You start with certainty
When your certainty is shown to be mistaken because the facts don't back it up, you follow up with obfuscation.
When your obfuscationary tactics are pointed out, you respond by saying that you never meant what you actually said anyway.
And then, tediously, predictably, you start all over again by stating that another of your ideas is certainly correct.
Round, and round and round. Bzzzz....Bzzzz....f**king Bzzzz....
It's been like that for millennia. Socrates gave examples of people who argue like that, and for the last 2,500 years, human development has been built on humanity generally ignoring those arguments and instead trusting arguments that are logically consistent and that produce predictions that can be checked by empirical facts.
But go on. Have another go...
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mjdgreg.
You display on a daily basis the classic steps of the second rate arguer.
You start with certainty
When your certainty is shown to be mistaken because the facts don't back it up, you follow up with obfuscation.
When your obfuscationary tactics are pointed out, you respond by saying that you never meant what you actually said anyway.
And then, tediously, predictably, you start all over again by stating that another of your ideas is certainly correct.
Round, and round and round. Bzzzz....Bzzzz....f***ing Bzzzz....
It's been like that for millennia. Socrates gave examples of people who argue like that, and for the last 2,500 years, human development has been built on humanity generally ignoring those arguments and instead trusting arguments that are logically consistent and that produce predictions that can be checked by empirical facts.
But go on. Have another go...
I've produced evidence with links that show what you say is factually incorrect. I've humoured you with giving answers to questions you ask and then you try to say that because I've given you an answer then that is the strategy that I believe will get us out of the mess we're in. Wrong.
You again make the mistake of confusing me with someone that believes austerity is the only way forward. I repeat, I don't believe solely in austerity and never have done. You try to paint that picture of me because it suits your black and white view of the world. Unfortunately life is a bit more complicated than that.
You say that I start with certainty and when it is shown to be mistaken I follow up with obfuscation. That is your opinion. You are guilty of changing the facts to suit your own argument and assume incorrectly that I then accept your version of events. I don't. I stand by my facts and give no credence to your altered version.
I totally dispute that you have shown my facts to be mistaken. Please give an example of where I have ever responded by saying that I never meant what I actually said anyway. You won't be able to because I have never done it.
One thing you should have learned by now is that I don't change my mind. I work it all out thoroughly beforehand and then remain consistent in my views (unlike you). I am prepared to change my views if someone can show me where I've got it wrong but so far no-one has come close to making me change my mind. Therefore rest assured that there is no obfuscation on my part. The obfuscation is all down to you.
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Mick.
Give up lad. Just give up. The world is laughing at you. This thread has gone viral.
I KNOW you don't just believe in Austerity. You also want higher interest rates. Genius. EXACTLY the right way to get out of Depression. I can't imagine why no central banker or Finance Minister has thought of that...
But you still make the same mistakes in every exchange. In the latest one, after you were taken by the nose to see that your internet friend didn;t know his arse from his elbow, you respond by posting yet MORE from him. Genius arguing style. I'll accept that I've been posting webshite, but in response I'll post yet more from the same webshite. Socrates would have placed olive wreaths on your head and gone home weeping.
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mjdgreg
Give up lad. Just give up. The world is laughing at you. This thread has gone viral.
I KNOW you don't just believe in Austerity. You also want higher interest rates. Genius. EXACTLY the right way to get out of Depression. I can't imagine why no central banker or Finance Minister has thought of that...
But you still make the same mistakes in every exchange. In the latest one, after you were taken by the nose to see that your internet friend didn;t know his arse from his elbow, you respond by posting yet MORE from him. Genius arguing style. I'll accept that I've been posting webshite, but in response I'll post yet more from the same webshite. Socrates would have placed olive wreaths on your head and gone home weeping.
pmsl. It must be great living in a parallel universe. The only one that is being laughed at is you! Every time evidence is produced that you don't agree with you always try to rubbish the source. Why don't you try to counter the arguments instead? You don't because you can't, so then you fall back on trying to rubbish the source again. You then also throw insult after insult at me. This is not a good debating style and shows your weak argument up for what it is.
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Mick.
Rubbishing the source is not some sort of jerk-off debating trick.
If you are basing your arguments on other folks' opinions, then the veracity of their opinions is crucial. If they can easily be shown to be inconsistent, inaccurate and biased in their interpretations, then they are unreliable sources.
You posted a source today who contradicted himself within 48 hours. Rubbishing him for doing so is a perfectly legitimate approach.
Bzzzz.....Bzzzzz.....f**king Bzzzzzzzzzzzz.....
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You posted a source today who contradicted himself within 48 hours.
Only in your opinion because it didn't suit your argument. I nearly gave your opinion some credence but only because you know what you are talking about when it comes to contradicting yourself.
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Mick.
Cone in then. Chapter and verse. Give it to us straight. Why do you think that your man was being consistent in his assessments of Estonia and USA?
Easy route here for you to finally win a discussion point. Let's hear your thoughts.
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I KNOW you don't just believe in Austerity. You also want higher interest rates. Genius. EXACTLY the right way to get out of Depression. I can't imagine why no central banker or Finance Minister has thought of that...
Central bankers and Finance Ministers have thought of that but don't do it because they always take the short-term politically expedient way out that ends up doing more damage in the long run. Higher interest rates are only one part of the strategy that I have worked out that will save our economy. If I was in charge there would be no political expediency.
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Go on Mick. I'm agog. Remind me what the rest of your strategy is...
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Translates into "I`m not going to answer your claim because if I tell the truth it will confirm Marydene Rover is lying and if I deny it it will confirm I`m wrong"
Of course mjdgreg, in your warped little world you`re never wrong, so will not confirm it, you`ll just ignore the question as you are doing now, and have done throughout this and other threads.
I don`t do deals mjdgreg, just answer the question, do you and Marydene Rover know each other very well, yes or no will do! You already know that I know the answer, but just confirm it for the benefit of the rest of the posters, confirm that you`re a fake mjdgreg, thats all!
Translates into I can't find ten contradictions so will just keep on asking the same question and hope that nobody notices that I have made an absurd claim. Look, I'll make it even easier for you. Just admit that you can't find ten contradictions and I'll happily answer your question.
I`ll use one of your tactics Mick. It`s refreshing to see by your lack of confirmation or denial that you are admitting defeat on this one, you really should be more humble when you`ve had your arse kicked though!
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I`ll use one of your tactics mjdgreg. It`s refreshing to see by your lack of confirmation or denial that you are admitting defeat on this one, you really should be more humble when you`ve had your arse kicked though!
Sorry, I don't do humble. My offer still stands. I can't say fairer than that. I'm happy to leave the readers to decide whose arse has been kicked.
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Go on mjdgreg. I'm agog. Remind me what the rest of your strategy is...
I'll try and get back to you later today. In the meantime I suggest you read my latest thread because if you follow the advice in it your memory will improve. However if you are over 55 years of age which judging by the way you debate I suspect you are, then you may already be too old to benefit.
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I`ll use one of your tactics mjdgreg. It`s refreshing to see by your lack of confirmation or denial that you are admitting defeat on this one, you really should be more humble when you`ve had your arse kicked though!
Sorry, I don't do humble. My offer still stands. I can't say fairer than that. I'm happy to leave the readers to decide whose arse has been kicked.
OK, you don`t like being humble when you`ve had your arse kicked, I can live with that, can you live with having your arse kicked by a leftie crank? I`m sure the readers have already decided that I`ve won this latest duel with you, your clear refusal to answer my question confirms you have lost again! well done Mick for admitting defeat!
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OK, you don`t like being humble when you`ve had your arse kicked, I can live with that, can you live with having your arse kicked by a leftie crank? I`m sure the readers have already decided that I`ve won this latest duel with you, your clear refusal to answer my question confirms you have lost again! well done mjdgreg for admitting defeat!
You're beginning to sound like me more and more every day. Well done. You don't need the humour bypass reversal operation. I'm pleased you've realised that you are a leftie crank. Admitting the problem is the first step to getting a cure. I'm also happy for you that you think you won that duel. I think the next problem we need to tackle is delusion.
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I'm lost Mick. Does that mean you DO know Marydene Rover or your don't?
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Translates into "I`m not going to answer your claim because if I tell the truth it will confirm Marydene Rover is lying and if I deny it it will confirm I`m wrong"
I have never said whether or not I know Madmick, I have said that I do not know Mjdgreg. I certainly haven't been lying !!! Marydene Rover
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My strategy for sorting out the economy in a nutshell is as follows:
1) Raise interest rates.
2) Cut taxes.
3) Cut public spending.
4) Withdraw from the EU.
5) Scrap Quantitative Easing.
6) Stop borrowing to fuel consumption.
7) Execute Gordon Brown as a warning to politicians that gross mismanagement of the economy will not be tolerated in future.
8) Jail for anyone who votes Labour in future.
9) Immediate stop to immigration and the repatriation of certain foreigners.
There you have it. The recipe for economic success. Simple really.
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Translates into "I`m not going to answer your claim because if I tell the truth it will confirm Marydene Rover is lying and if I deny it it will confirm I`m wrong"
I have never said whether or not I know Madmick, I have said that I do not know Mjdgreg. I certainly haven't been lying !!! Marydene Rover
Really? I'd like mjdgreg to confirm that, he seems to be avoiding the answer!
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Cool list Mick.
That idea of raising interest rates, cutting public spending and scrapping QE. Sounds like a gem of an idea to get a country out of a demand-slump Depression. I'm at a loss as to why no economist has thought of that over these last 5 years.
I wonder if it might be because it would lead to a 25% drop in GDP and 12 million extra on the dole perhaps?
But hey. Mickonomics is the future eh? A future that presumably includes unicorns, Father Christmas, the Tooth Fairy, Dog Heaven and all the other infantile shit that people believe in before they start to get educated in how the real world actually operates.
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I'm at a loss as to why no economist has thought of that over these last 5 years.
Whether they have or haven't is irrelevant. I'm sure I could find some if I could be bothered. I have the courage of my own convictions and don't need to check with a crank economist before I post. We are in uncharted territory and new clear blue sky thinking is required. I am ready to step up to the mark and offer my help and advice to George any time. Sometimes all that is needed is common sense, a quality I have in abundance.
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I wonder if it might be because it would lead to a 25% drop in GDP and 12 million extra on the dole perhaps?
Interesting that you are able to predict so accurately what would happen. I must admit I would have found it impossible to make any predictions unless I knew how much interest rates were going to go up by and for how long and how far public spending was going to be cut. I'd have also found it difficult to make a prediction without knowing all the ins and outs of the rest of the policy first. I'd then have to factor in the rest of the world economy as well and no end of other macro-economic factors.
So I take my hat off to you for being able to come up with such accurate predictions on next to no data. You must have an amazing crystal ball and I suggest you change your name to Gypsy Rose Stubbs.
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Yes Mick. Yes. Agreed. You are so, so right. You could be the saviour of the world. I'll accept every word and put this thread to bed now.
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Yes Mick. Yes. Agreed. You are so, so right.
At last, the penny has dropped. Phew, that was hard work. Just one more thing. Why if you agree so wholeheartedly have you not changed your name to Gypsy Rose Stubbs?
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If it makes you happy Mick. If it makes you happy...
PS: I just phoned the people at Word Hippo to ask why they didn't have a synonym for "happy". They said "shut the f*** up".
So, if it makes you shut the f*** up Mick...
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Now that Gypsy Rose Stubbs has seen the light and won't be posting on this thread any more I will in the near future produce a layman's guide to the economy so you can all understand the impending doom that faces us much better. Once you understand the problem you will be far better placed to get through the extremely tough years that lie ahead.
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Meanwhile, can you answer my previous question, a simple yes or no will do, not the usual b*llocks you post when trying to avoid the answer!
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My Thoughts on Mick's list.
1) Raise interest rates. - Inflation is lowering so there is scope. It's a decision on to how we move long term that will drive this and there's too much of a wedge between political parties to allow for economic re-structure. We need it but we won't get it, therefore it'd be a pointless move.
2) Cut taxes. - I'm neither here or there on this, the problems are largely outside of our country, that will drive our future, a tax cut won't make a huge difference and will only see to a cut in revenues. Equally a tax rise would be pointless, small tweeks but nothing major. If anything the only potential cut should be to business taxes and to national insurance to get more people working, but given the state of the treasury's expenditure it may end up unaffordable. Working that out isn't easy. I actually think whilst it's helping ordinary people it's not having a huge difference.
3) Cut public spending. - Agree, this has to happen as we're still overly weighted into public expenditure that won't cut the debt. Labour have no plan for this, big weakness of theirs still.
4) Withdraw from the EU. - Long term I'd prefer us to be out of Europe for non economic reasons, but economically it's not the right move.
5) Scrap Quantitative Easing. - Agreed, it has limited effect, the only positive is to devalue the currency, bad for savers, increased inflation but does increase competitiveness.
6) Stop borrowing to fuel consumption. - Massively agree, it's against the principles I belive in economically. This has happened for too long and we're at the tipping point now, don't fall into the traps that partly caused the problem.
7) Execute Gordon Brown as a warning to politicians that gross mismanagement of the economy will not be tolerated in future. - Hmmmm.
8) Jail for anyone who votes Labour in future. - Under the current leadership of Labour anyone who votes for them needs their head checking. But, we don't know enough about what they plan to do, the soundbites they have said are offering nothing, just shots at the Tories. Could they actually deliver anything different? Well, they've not answered that yet.
9) Immediate stop to immigration and the repatriation of certain foreigners. - Pointless.
One day people will realise the one thing, what we do in this country is pointless right now, we're integrated too much globally. We need to build our economy differently, but the politicians in this country can't agree on enough to do that, which is a shame. Who cares about the pathetic party policits most are attempting to employ.
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Well balanced post BFYP. We'll just have to disagree on a few points. I'll be fleshing out my policy a bit more in the near future to explain why I came up with my list. It's a big job so people will have to just bear with me for a while.
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Still refusing to answer the question Mick?
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BFYP.
A question for you:
Why does a reduction in inflation mean that there is scope to raise interest rates? Raising interest rates is the classic response to an overheating economy, in which there is a danger of excess demand leading to raised inflation. Our prime current problem (and that of the USA and Europe) is the precise opposite of that. We have a massive gap in demand relative to what the economy could be producing. That is the reason that we have tipped back into a severe recession. Raising interest rates in such a situation is economic lunacy, since it would suppress demand still further.
This entire discussion unfortunately shows how the root of the problem has not been grasped by the population.
We are in a terrifyingly dangerous economic situation, where demand has collapsed. The standard approach to re-igniting demand over the last 50 or so years has been to cut interest rates, make it easier for companies to borrow to invest and get the economy moving again. Then you raise interest rates once the economy is pulling away, to stop things overheating.
We've tried that and, whilst it has helped, it isn't nearly enough. But to think, as many on the lunatic right-wing fringe do that the conclusion of that is that interest rates should be raised is mad.
The next, rarely used big step is QE. The idea here is to massively increase the amount of currency in circulation, in an attempt to convince people that they should spend it. What happens in a demand-slump recession/Depression is that the rate at which money goes round the economy collapses. If more and more people and businesses decide to hold onto money rather than spend it, the size of the economic market contracts. There's no argument about that - it's a simple fact. (You can think about that by considering the limit in which EVERYONE held on to ALL their money and spent nothing. We'd all have the money that we started with, but no-one would have any work because no-one would be paying for any goods or services.)
We're a long way into the demand collapse situation now, with a very large number of individuals and companies trying to cut back on their expenditure. That is a very logical thing for them each to do, considering their own individual circumstances. But it is precisely the WRONG thing for the country as a whole when very large numbers of individuals and companies all do it at the same time. We know that, because it has happened time and again through history, always with catastrophic economic effects. And the same catastrophic effects are being visited on us and Europe right now, for exactly the same reasons.
So, QE is an attempt to get more money into circulation, in an attempt to convince more people to spend and to get the economy working again. Again, it's helped, but it's clearly not enough on its own.
By the way, the doom-mongers on the Right who say that QE will lead to rampant inflation have been proved utterly wrong by events. In both the UK and USA there has been MASSIVE QE, yet inflation is falling, after a brief rise due mainly to increases in global commodity prices. The long-term bond rates for both countries strongly suggest that the Markets believe that inflation will remain low for the rest of this decade, despite QE, and there are renewed fears starting to emerge that we are heading back into outright DEflation, which really WOULD be the nightmare scenario. The lunatic Right will continue to say that inflation WILL rise in the long run. But as a very great man once said, in the long run, we are all dead. What matters is getting things right in the short and medium term, and QE has a part to play in that.
I'll repeat what I've said times many in this thread, there is no example in economic history of a mature Western market economy getting itself out of this kind of demand-collapse Depression without major increases in demand produced by increased Govt spending. To the person who has not studied this in detail, it sounds illogical to suggest this in a situation where Government debt is already high, but there is simply no credible alternative. None. Anywhere. Ever.
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Here's my first part of understanding the economy. There will be more to follow.
To understand the economy better I’ve come up with a hypothetical example that shows why we’re in the mess we’re in and why borrowing and spending more money will only make matters worse. This isn’t going to be easy to understand and you may have to read it a few times before the penny drops.
In the following example I’m going to assume that a country has a gross domestic product of £1,000. Let’s imagine that the government raises taxes from the population of 25% of GDP and this money is then used for public spending. Unfortunately politicians being what they are, instead spend 30% of GDP. This then means that they have to borrow the difference which is £50 (5% of £1,000).
Because the country has got little debt this attracts a low interest rate. This is because those who buy the debt are very confident that the country can afford to pay them back. So we end up with the country having a debt of only 5% of GDP (£50). If the interest rate is say 4%, this equates to an interest payment of £2 per annum which is only 0.2% of GDP. Doesn’t sound too bad does it?
Unfortunately this goes on year after year. Let’s assume that public spending grows at the same rate as the country grows. Also let’s assume that the debt keeps growing at an average of 5% of GDP per annum. If we assume a growth rate of say 3% per annum, after 24 years the economy will have doubled to around £2,000 GDP. This will mean that the debt has grown to about £1,800, which is now a debt-to-GDP ratio of 90% (90% of £2,000 is £1,800). This has happened because debt has grown faster than the country's economy by 2% per annum (3% growth rate, 5% debt interest).
If the country had held public spending down to a level where it grew slower than GDP, so below 3%, it would have reduced the requirement for debt, thus making the debt-to-GDP ratio lower. This would have happened even if the National Debt had grown. So to summarise, it is possible to grow your way out of a debt problem as long as the growth of public spending is less than the growth of the economy. If only we had politicians that would do this but unfortunately they can’t resist the urge to over-spend, especially Labour politicians.
In my next instalment I'll explore what happens if public spending grows to about 50% of GDP, rather than 25% or 30% over the 24 years.
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Mick.
Your post can be put rather more concisely.
If a Govt's deficit as a proportion of GDP is consistently higher than GDP growth, the Govt debt will grow as a percentage of GDP. You have said precisely no more and no less than this.
I am utterly overwhelmed by this quite dazzling insight. I strongly suspect that no economist in world history has previously latched onto this. This has the potential to transform world economics. I bet Keynes and Friedman, if alive today, would be sticking pins in their genitalia, such would be their self-loathing at having overlooked this concept.
The world salutes your unrivalled genius.
I'm waiting on the edge of my seat to find out what happens in your next installments.
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mjdgreg
Your post can be put rather more concisely.
If a Govt's deficit as a proportion of GDP is consistently higher than GDP growth, the Govt debt will grow as a percentage of GDP. You have said precisely no more and no less than this.
I am utterly overwhelmed by this quite dazzling insight. I strongly suspect that no economist in world history has previously latched onto this. This has the potential to transform world economics. I bet Keynes and Friedman, if alive today, would be sticking pins in their genitalia, such would be their self-loathing at having overlooked this concept.
The world salutes your unrivalled genius.
I'm waiting on the edge of my seat to find out what happens in your next installments.
Everything I've posted is as easy as A B C to me. Unfortunately our media doesn't do a very good job of educating the great unwashed. So this post is aimed at them and not the likes of you and I.
I always explain my arguments in easy to understand language whereas you like to try and blind everyone with science. You don't fool me though. When I've finished they will be in no doubt whatsoever that Keynes is a crank and your strategy would turn us into a third world country.
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I'm sat here like Kwai Chang Caine at the feet of the old blind master Po.
Let the learning begin...
PS: I think you probably meant "you and me" at the end of that first paragraph, but I'll let it pass.
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PS: I think you probably meant "you and me" at the end of that first paragraph, but I'll let it pass.
Be warned. If you want to go up against me on grammar you will come off a very poor second.
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Master Po, I do not doubt it. I say these things only in confidence to you, so that you may modify your posts in order to ensure that others do not think less of you.
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Still refusing to answer the question Mick?
Meanwhile, back at the ranch!
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Master Po, I do not doubt it. I say these things only in confidence to you, so that you may modify your posts in order to ensure that others do not think less of you.
I'm going to do a test. I'll be making some deliberate mistakes in grammar in future just to see if you can spot them. Then we'll sea how good you are.
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Will that be after you've answered Filo or before?
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Mick
You do realise that I don't give a flying f**k if your grammar is better than mine. You DO realise that don't you? You do realise that I only posted comments on your grammar to point out the facile imbecility of someone who takes it upon themselves to vociferously criticise other people's grammar.
The whole concept of complaining about grammar on a non language-relate forum is tedious in the extreme. As Oscar Wilde once said, it is the last refuge of a tit who has lost all sense of self-respect. But since you DID insist on bringing the subject up over and over and over again, I thought you would like to have your manifold errors pointed out, just so you can improve your game in the future.
I'm SURE your grammar is better than mine Mick. I'm certain of it. I salute your grasp of it.
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This thread is hilarious. Just putting it out there.
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Thank you mushRTID. You confirm what I already knew and what Billy has failed to see. That's why I recommended the humour bypass reversal operation.
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And still no answer :whistle:
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Will that be after you've answered Filo or before?
You've failed already! My post that you replied to contained the following delibarate error:
I'm going to do a test. I'll be making some deliberate mistakes in grammar in future just to see if you can spot them. Then we'll sea how good you are.
I've highlighted the error just in case you still failed to spot it. It should have been 'see' not 'sea.' See, I did warn you.
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And still no answer
I know. I've been waiting for sevaral weeks now for you to find some of the hundreds of contradictions you say I've made. Lucky for you that I am very patient.
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And still no answer
I know. I've been waiting for sevaral weeks now for you to find some of the hundreds of contradictions you say I've made. Lucky for you that I am very patient.
Says it all really, you refuse to confirm how cosy you are with Marydene Rover, because you know if you deny it you`ll be telling porky`s, your charade is over Mick, the whole forum knows you`re a fraud, time to come clean and stop making yourself look more foolish than you already are! I`ve beaten you hands down, everyone can see that, yourself included, game, set and match!
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Will that be after you've answered Filo or before?
You've failed already! My post that you replied to contained the following delibarate error:
I'm going to do a test. I'll be making some deliberate mistakes in grammar in future just to see if you can spot them. Then we'll sea how good you are.
I've highlighted the error just in case you still failed to spot it. It should have been 'see' not 'sea.' See, I did warn you.
Ooof! Kerpowww!!
You got me Mick. Gee, but you're a canny one...
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You've failed already! My post that you replied to contained the following delibarate error:
Quote
I'm going to do a test. I'll be making some deliberate mistakes in grammar in future just to see if you can spot them. Then we'll sea how good you are.
I've highlighted the error just in case you still failed to spot it. It should have been 'see' not 'sea.' See, I did warn you.
Ooof! Kerpowww!!
You got me Mick. Gee, but you're a canny one...
Got you again! I've highlighted the error for you. I said ' My post that you replied to contained the following delibarate error.' That should be deliberate not delibarate. pmsl....
Also, I've checked with WordHippo and 'Gee', 'Ooof' and Kerpowww are not words. I think you must have been reading too many Batman comics. Also it should be 'You've got me'. All in all a pretty poor effort. Don't say I didn't worn you.
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Here's my next instalment in understanding the economy which follows on from my previous one.
Now let’s see what happens if public spending grows to about 50% of GDP, rather than 25% or 30% over the 24 years. (When Labour left office it was over 50%). This means that the productive part of the economy (the private sector) must pay about 50% of its production in taxes. Also the debt is now growing out of control. The consequence of this is that the private sector has less money and so the growth of the economy slows.
Then along comes a very nasty financial crisis. The revenues of the government fall as the economy shrinks. If the economy shrinks by 3% and total taxes are 50%, then tax revenue falls to £970 (£1000 less 3%). But the government does not cut back. Indeed, because it must pay unemployment benefits and welfare (because unemployment rises in a recession), its expenses actually rise by 5%! So it now needs £1,050 to pay all its budgeted expenses and it must now borrow £80 (£970 + £80= £1050) to pay everyone it has promised to pay, in addition to the £100 it was already borrowing every year to cover its deficit. So we now end up borrowing a total of £180 a year, which is 9% of GDP (remember our GDP is now £2000 so 9% of £2000 is £180). When Labour left office, our budget deficit was over 10% a year.
Now debt-to-GDP is rising by about 5% a year. Not a large number in the grand scheme of things and everyone knows that the recession will soon be over and the deficits will come down as the economy starts to grow again. Sovereign governments never default on their debts according to our politicians. They can always raise taxes or cut spending (so they say).
Things tick along nicely and the bond market continues to buy the debt, until one day they realise that the debt has risen to 120% of GDP. Then the bond market gets nervous and says that instead of 4% it wants 7%. Now the interest payments are over 8% of GDP and account for over 16% of government spending, which means the government must either cut back on public spending, or raise taxes, or borrow more money. Or a combination of all of these options. But cutting spending, raising taxes and borrowing more money have consequences. They reduce the opportunity for GDP growth as the economy adjusts and increase the National Debt.
What if that interest rate cost rose to 10%? Then the interest cost to the government would become 20% of its expenses and would be rising faster than the country could grow, even in the best of times. And if they continued to borrow at 7% and the country did not grow, those interest expenses would rise at least 7% a year (as long as interest rates didn't go up).
Then what would happen if the other countries who had been buying the government's debt looked at the basic maths of the situation and realised that, another step or two down the current path of government spending, there was no way they would be able to get their money back?
Now, government bond investors invest in government bonds because they actually think there is not supposed to be any risk. They want their money to be safe. If they wanted risk, there are lots of opportunities to invest with the potential for more reward.
The moment that government bond investors begin to think they might be at risk, they leave. History suggests they tend to leave seemingly all at once. Someone fires the starting gun, and they all head for the exits. They start selling their bonds to speculators at discounts, which makes the effective interest rates in the market rise, sometimes by a lot. That means that if a country wants to borrow more money, it will have to pay the effective price in the market, or maybe as much as 15-20% if, and it’s a big if, it can even get someone to buy the bonds, which of course makes it even more difficult to pay their debt as interest costs rise.
This is the path Labour were taking us down and it has to stop. In my next instalment I’ll explain a bit more about the bond holders and what happens when governments are unable to pay their debts.
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Mick - what's amazing is that someone else had the exact same thoughts, and phrased them almost identically, back in January:
http://articles.businessinsider.com/2012-01-14/markets/30626783_1_s-p-european-commission-global-growth/3
Eerily, your first "educational" post on economics was also penned by the same guy, in the same article, back in January:
http://articles.businessinsider.com/2012-01-14/markets/30626783_1_s-p-european-commission-global-growth/2
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This is the thread that just keeps on giving.
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mjdgreg - what's amazing is that someone else had the exact same thoughts, and phrased them almost identically, back in January:
You have a very vivid imagination. Why is it a surprise that you can find views similar to mine if you spend hours trawling the internet? Also, don't forget that I have a photographic memory and can instantly recall information with no effort at all. Why do you think I am so super intelligent? It's partly due to my photographic memory. I suggest you spend your time reading my posts instead of trawling the internet and get an education on the economy. You never know one day you may see the light and be free of being a leftie crank.
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Very informative series you have put together thank you Mjdgreg, I'm no expert on these matter and I am a natural leftie labour voter. I would appreciate BST's response to help me understand the counter argument.
I hope he hasn't given up and withdrawn from the debate.
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Very informative series you have put together thank you Mjdgreg, I'm no expert on these matter and I am a natural leftie labour voter. I would appreciate BST's response to help me understand the counter argument.
I hope he hasn't given up and withdrawn from the debate.
Don't hold your breath. I think even he has realised that he has conclusively lost the debate and that there isn't a counter argument. Billy would have you believe that more spending is the solution. It is over-spending that has got us to where we are now. He would have you believe that the coalition have introduced swingeing cuts. They haven't.The Labour party have done an excellent job in convincing everyone that this is the case. Nothing could be further from the truth. In fact, the coalition is borrowing almost as much over five years as Labour did over thirteen!!!
Labour have left us well and truly in the shit big-time and we are nowhere near feeling the consequences yet. Here is an article that I could have written myself that exposes the big lie that our gullible population (and bond markets) has swallowed. If anyone can still call themselves a Labour supporter after reading this article then there is no hope for them.
http://www.dailymail.co.uk/news/article-2146571/Cuts-What-cuts-Ignore-BBC-Left-public-spending-HIGHER-Labour.html
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Here’s the next instalment in my understanding of the economy for the great unwashed.
I’m now going to add a twist. The other countries that have bought those bonds are not actually countries, but are actually banks in other countries. Because the regulators of those banks knew it was impossible (or so they thought), that a sovereign country might default, they allowed their banks to buy 30 times as much sovereign debt as they had capital in their banks!!! They did not have to have any reserves to protect themselves against any losses because in theory there could never be any losses.
So in effect these were "free" profits for the banks. You pay 2% to people who deposit with you and then buy bonds paying at 4%. You make a 2% spread, so make 2% profit which you then do 30 times. Now you are making 60% profits (30 x 2%) on your capital and deposits. It is a very nice business – as long as everyone pays the interest. Because it is such a good business, you just roll over the debt every time the bond comes due, because you want more easy profits.
Let's say that banks bought up to 10% of their total government sovereign-debt holdings in our problem country (think Greece, Ireland, Portugal, Spain, Italy etc). If the country gets into trouble and says, we will only pay 50% of our debt, then that means the banks lose 5% of their total assets (they’ve lost half of 10% of their total government sovereign-debt holdings in our problem country, which is where we get the 5% of total assets from). But they only have about 3% capital, because they were allowed to leverage. Because they don’t have 5% capital to cover the losses that means they are functionally bankrupt. This ludicrous leveraging system was so be-loved of Gordon Brown and the incompetent Bank of England.
Because the banking system is effectively bankrupt, other countries now have to step in and take the losses (and perhaps wipe out the shareholders and owners of their banks). That would be bad for the other countries, as that much spare cash is not just lying around in government coffers. They are ALL borrowing money already and have their own deficits to worry about.
So everyone gets together and they tell the bankrupt country (because that is what it really is), we will lend you more money to keep you alive, but you must agree to balance your budget. Since that is the only way the problem country can get more money, they initially say, "Sure. We can do that. Just give us some money now so we can get it figured out and get everything under control."
In the world of government, living within your means is called austerity. And it's an uphill slog. Let's say your deficit started out at 15% of GDP (somewhat like Greece's). If you agree to cut that deficit by 4% a year for four years running, if everything stays the same, you could be back in balance. But the other countries would have to agree to lend you the difference between what you budgeted to spend and what you took in as tax revenues, just to keep things going. Otherwise you'd have to default on your debt. If the countries simply have to guarantee the loans and not actually spend the money, it is a lot easier than having to find real money to save their banks, so they agree.
But the cuts you have to make are not as easy as everyone hoped. It seems that employees don't like having their pay cut, and unions don't want pensions cut, and retirees certainly expect the government to fulfil its promises.
So you raise taxes and cut spending by about 4% the first year. But a funny thing happens. That reduces the private economy by about 4%, so the base on which taxes are collected is reduced, which means less revenue is raised, which means that the deficit is much worse than projected. Then the following year you have to make another 4% in cuts, plus the last shortfall, just to stick to the plan and get to the agreed-upon deficit, in order to get more loan money. It becomes a very vicious circle.
In my next instalment we'll look at the endgame.
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Very informative series you have put together thank you Mjdgreg, I'm no expert on these matter and I am a natural leftie labour voter. I would appreciate BST's response to help me understand the counter argument.
I hope he hasn't given up and withdrawn from the debate.
Breaking News....
Mick fails to correct a gramatical error in one his alias' posts......
Filo wins by TKO
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Breaking News....
mjdgreg fails to correct a gramatical error in one his alias' posts......
Filo wins by TKO
You need to concentrate more on my posts. I've been leaving the odd grammatical error on purpose for Gypsy Rose Stubbs to find not Filo (or you).
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Breaking News....
mjdgreg fails to correct a gramatical error in one his alias' posts......
Filo wins by TKO
You need to concentrate more on my posts. I've been leaving the odd grammatical error on purpose for Gypsy Rose Stubbs to find not Filo (or you).
So by that statement, are you, in fact, admitting that you and Marydene are, in fact, one and the same
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So by that statement, are you, in fact, admitting that you and Marydene are, in fact, one and the same
No we're not. Marydene has joined in with leaving the odd gramatical error that's all.
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..... mmmmm what does that remind me of ?
http://www.youtube.com/watch?v=z5effaImHsU
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I repeat I am not Mad Mick and never have been, my views are my own please treat me with a little more respect.
Also if I have made a spelling or grammatical error please let me know as I can't see it.
Thanks
Marydene Rover
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I repeat I am not Mad Mick and never have been, my views are my own please treat me with a little more resepct.
Also if I have made a spelling or grammatical error please let me know as I can't see it.
Thanks
Marydene Rover
I know you`re not Madmick, I also know that you`re not mjdgreg (madmick), and I also know that you know him, despite you denying it, if you want respect then treat the forum with respect! mjdgreg (Mick) knows I know this, that`s why he keeps ignoring my question to confirm this
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Next instalment.
Now let's look at the endgame. That debt-to-GDP ratio will rise to at least 150%, while the economy is actually shrinking. If interest rates settle to a mere 7% (hardly likely), it means the people of the country are going to have to pay over 10% of their total production to foreign banks each and every year for decades, never mind paying down the principle.
Let's throw in one more twist. The country has been buying about 10% of GDP more from other countries than it sells to them. That is because the relative wages in the problem country are about 30% higher than in the "good" countries. The good countries get the money from what they sell and have a nice surplus. The problem country soon runs through its savings, trying to buy the goods and service it wants; and the private sector, as well as the government, must cut back.
What happens is that you are locking in what feels like a depression initially, and then you have a slow- or no-growth economy for many years, as so much of your work goes just to pay back that debt to the banks of other countries.
Understand, your government has freely obligated itself to pay that debt. But it means that its citizens in effect become debt slaves for a generation or two to foreign banks. Not a very popular platform for a politician to run on for re-election.
You all know what I think of crank Keynes. People who blindly follow his logic don’t have a proper view of the world. They live in a theoretical world divorced from what really happens. But in this respect they are deadly right. Austerity on the scale needed by many countries will only reduce potential GDP. The Keynesian prescription is to therefore run deficits and borrow money until you get growth again. Unfortunately they ignore the fact that when you have already exhausted your ability to borrow money, it just doesn't work.
More debt makes if far more difficult to grow your way out of the problem. If you are already drunk, you can't get sober by drinking more whiskey. If our problem country cuts its deficit by 15% of GDP, the reality is that GDP over time will be reduced by about 20%, and the debt will grow, both in real terms and as a percentage of GDP.
A 20% decline in GDP is by any standard a depression and makes it even harder to grow. This is because so much of what you produce has to be used to pay basic expenses and is not allocated as productive capital. If you have the burden of massive debt it becomes impossible.
That is why individuals can file for personal bankruptcy. We no longer force people into slavery or debtor's prison to pay their debts, at least in most places.
So our problem country goes to its lenders and says, "We think you should share our pain. We are only going to pay you back 50% of what we owe you, and you must let us pay a 4% interest rate and pay you over a longer period. We think we can do that. Oh, and give us some more money in the meantime. And if you refuse, we won't pay you anything and you will all have a banking crisis. Thanks for everything."
So as I see it there are two ways governments typically try to solve the problem. Default on the debt (which brings its own major problems) or inflate the debt away. Make no mistake the current policy of the UK government is to inflate the problem away. They won’t tell you this, but it is obvious that this is the strategy.
This is going to take many years and will gradually reduce everyone’s standard of living to the point where we are eventually living within our means for a change. It is going to be an extremely painful process and is being implemented because of the wasteful spending and borrowing of the previous Labour government.
My solution would be different and would get things sorted out in about 2 years. There would initially be a lot of pain but then the gain would come around much more quickly. At the moment we are bleeding to death. It’s no good keeping on pumping blood (money) into the body (economy) unless you are going to sew up the wound (cut the Budget Deficit) first.
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Time to lock this thread now Mick, it`s run it`s course, it`s obvious now that no one wants to debate it any more, you`re now posting in reply to yourself and attempting to get a bite to continue this charade
END OF THREAD!