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Post by zanygame on Oct 19, 2023 6:37:01 GMT
Not really. I think both growth and correct taxation are needed. But this is about how we control inflation. Which can also be done in two ways. Want to lower the amount of cash in the economy in a fair way, temporarily raise taxes and pay down public debt. That way we all share the load according to ability. But Oh no. The rich make the rules and guess what they think is best. Yep, those that need to borrow money should carry the load. Who'd have thought it. Financially illiterate. The UK's interest rates are not solely determined by the BoE. We live in a global environment and we rely on borrowing so our interest rates are heavily affected by global rates - and global rates have gone up. And the huge borrowing that we now have loaded ourselves with is partly down to Gordon Brown's expansion of the state and reliance on PFIs and it's partly down to our lockdowns during the pandemic. Sunak borrowed an extra £400 billion to finance furlough. When you ask "who's (sic) fault it is" I'm not sure who you're thinking of but the people who are actually to blame are Brown and Sunak. Then why do they claim its to lower inflation. If it was as you say just the cost of global borrowing then the BofE would have no control over it. Further they would be unable to set it well below the world level for years. I'll ignore GB and PFI as irrelevant blame pushing. As using interest rates to rob the poor goes all the way back to Thatcher. |
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Post by steppenwolf on Oct 19, 2023 8:16:29 GMT
If you "ignore GB and PFI as irrelevant blame pushing" you just compound your illiteracy. The reason why the world demands 6% and more to finance our debt is because we now have national debt of about 100% of GDP. If it weren't for the fact that the UK has never defaulted on its debt we'd be having to pay much more. And the main reason why we have such a big debt pile is because of Gordon Brown's massive borrowing to fund a huge state. Sunak is also to blame for "spaffing" £400 billion up the wall on furlough but it's still only a fraction of our £2 trillion debt.
It's SFA to do with robbing the poor. You should stop seeing things in such a divisive way. If anything the setting of interest rates at about zero after the 2008 debacle was to protect the rich by propping up asset prices. Pushing up interest rates will lower asset prices which should be better for the poor - if anything. But it's a complex issue. The fact is that we've borrowed so much that we have no alternative to high interest rates.
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Post by zanygame on Oct 19, 2023 18:27:52 GMT
If you "ignore GB and PFI as irrelevant blame pushing" you just compound your illiteracy. The reason why the world demands 6% and more to finance our debt is because we now have national debt of about 100% of GDP. If it weren't for the fact that the UK has never defaulted on its debt we'd be having to pay much more. And the main reason why we have such a big debt pile is because of Gordon Brown's massive borrowing to fund a huge state. Sunak is also to blame for "spaffing" £400 billion up the wall on furlough but it's still only a fraction of our £2 trillion debt. It's SFA to do with robbing the poor. You should stop seeing things in such a divisive way. If anything the setting of interest rates at about zero after the 2008 debacle was to protect the rich by propping up asset prices. Pushing up interest rates will lower asset prices which should be better for the poor - if anything. But it's a complex issue. The fact is that we've borrowed so much that we have no alternative to high interest rates. Jeez. You just keep making it up don't you. Long after GB was history along with PFI the world was glad to lend to us money at 3%. Beyond that I can't be bothered to answer your made up rubbish as its so far from reality. |
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Post by patman post on Oct 19, 2023 20:55:25 GMT
If you "ignore GB and PFI as irrelevant blame pushing" you just compound your illiteracy. The reason why the world demands 6% and more to finance our debt is because we now have national debt of about 100% of GDP. If it weren't for the fact that the UK has never defaulted on its debt we'd be having to pay much more. And the main reason why we have such a big debt pile is because of Gordon Brown's massive borrowing to fund a huge state. Sunak is also to blame for "spaffing" £400 billion up the wall on furlough but it's still only a fraction of our £2 trillion debt. It's SFA to do with robbing the poor. You should stop seeing things in such a divisive way. If anything the setting of interest rates at about zero after the 2008 debacle was to protect the rich by propping up asset prices. Pushing up interest rates will lower asset prices which should be better for the poor - if anything. But it's a complex issue. The fact is that we've borrowed so much that we have no alternative to high interest rates. Jeez. You just keep making it up don't you. Long after GB was history along with PFI the world was glad to lend to us money at 3%. [snipped] That’s true. Then along came Truss, whose limited understanding of economics is reflected by several on here, and she trashed a UK economy that was reeling, but coping with the Covid aftermath… |
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Post by Pacifico on Oct 19, 2023 21:27:29 GMT
Jeez. You just keep making it up don't you. Long after GB was history along with PFI the world was glad to lend to us money at 3%. [snipped] That’s true. Then along came Truss, whose limited understanding of economics is reflected by several on here, and she trashed a UK economy that was reeling, but coping with the Covid aftermath… Trashed the economy? - gilt rates are higher now...  |
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Post by patman post on Oct 19, 2023 21:44:48 GMT
That’s true. Then along came Truss, whose limited understanding of economics is reflected by several on here, and she trashed a UK economy that was reeling, but coping with the Covid aftermath… Trashed the economy? - gilt rates are higher now...
Yields on UK treasury bonds – the rate the UK government must pay to borrow money – have risen to approximately 4.6% for ten-year bonds. Yields on 30-year bonds hit 5.1%, the highest since 1998.
theconversation.com/uk-bonds-have-hit-a-25-year-high-heres-what-that-means-for-the-economy-215188#:~:text=Yields%20on%20UK%20treasury%20bonds%20–%20the%20rate,have%20risen%20to%20approximately%204.6%25%20for%20ten-year%20bonds. |
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Post by steppenwolf on Oct 20, 2023 6:02:50 GMT
If you "ignore GB and PFI as irrelevant blame pushing" you just compound your illiteracy. The reason why the world demands 6% and more to finance our debt is because we now have national debt of about 100% of GDP. If it weren't for the fact that the UK has never defaulted on its debt we'd be having to pay much more. And the main reason why we have such a big debt pile is because of Gordon Brown's massive borrowing to fund a huge state. Sunak is also to blame for "spaffing" £400 billion up the wall on furlough but it's still only a fraction of our £2 trillion debt. It's SFA to do with robbing the poor. You should stop seeing things in such a divisive way. If anything the setting of interest rates at about zero after the 2008 debacle was to protect the rich by propping up asset prices. Pushing up interest rates will lower asset prices which should be better for the poor - if anything. But it's a complex issue. The fact is that we've borrowed so much that we have no alternative to high interest rates. Jeez. You just keep making it up don't you. Long after GB was history along with PFI the world was glad to lend to us money at 3%.
Beyond that I can't be bothered to answer your made up rubbish as its so far from reality. GB may be history but the various PFIs that he used to hide borrowing are very much alive and costing us a lot of money. And while GB has gone he left us with a state that was about 50% of GDP - i.e. half of our GDP was spent paying for the civil service and the like. That's partly why our productivity was (and is) very low. He also left us with a record peacetime budget deficit. And it's proved extremely difficult to get rid of all the "fat" (or dead wood) in our civil service. The Coalition tried freezing their pay but that doesn't work because they just promote each other and move into a new pay band - and sacking is very difficult and also costs a fortune. By the time the Coalition had got the budget deficit vaguely under control the debt had spiralled to about £1.5 trillion. Then came the pandemic. There's an old saying in finance that solving one financial crisis is usually the cause of the next. The damage that Blair/Brown did to our economy was long lasting. This is not a party political point - it's just an obvious statement of fact. If you knew anything about finance you would be aware of this. But Sunak has to take his own share of the blame because his spending was completely out of control too. |
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Post by Pacifico on Oct 20, 2023 6:18:34 GMT
Trashed the economy? - gilt rates are higher now...
as I said... |
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Post by steppenwolf on Oct 20, 2023 6:27:25 GMT
Jeez. You just keep making it up don't you. Long after GB was history along with PFI the world was glad to lend to us money at 3%. [snipped] That’s true. Then along came Truss, whose limited understanding of economics is reflected by several on here, and she trashed a UK economy that was reeling, but coping with the Covid aftermath… I've spent decades working in finance so my understanding of economics is pretty good - it has to be. Truss's understanding of economics may be lacking (especially in relation to LDIs) but PMs don't necessarily need to understand economics. That's why we have the Treasury. And, if you remember, her budget (which concentrated on growth) was well received to start with. Her downfall was because of political naivety. She had sacked Tom Scholar (a very powerful civil servant) and this turned the Treasury against her. She was also rude about the OBR and didn't let them evaluate her budget because she (correctly) thinks that their reports are very inaccurate. Also Sunak wanted to be PM and he has many friends in financial circles. He put the word around that this budget would crash the bond market because of unfunded borrowing etc and this caused the traders who bet on exchange rates to mark Sterling down. This in turn caused the BoE start selling bonds (wrongly). It was a total disaster in other words, but it was all caused by various people deliberately destroying the confidence in the markets - and confidence is essential for any govt. As it happens Truss's spending was less than Sunak's has turned out to be and interest rates are now higher than he said they would be after Truss's budget. And to compound Sunak's errors he also had no strategy for growth at all. In fact he has deliberately attacked growth with his hikes to corporation tax. |
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Post by zanygame on Oct 20, 2023 7:09:15 GMT
Trashed the economy? - gilt rates are higher now...
Yields on UK treasury bonds – the rate the UK government must pay to borrow money – have risen to approximately 4.6% for ten-year bonds. Yields on 30-year bonds hit 5.1%, the highest since 1998.
theconversation.com/uk-bonds-have-hit-a-25-year-high-heres-what-that-means-for-the-economy-215188#:~:text=Yields%20on%20UK%20treasury%20bonds%20–%20the%20rate,have%20risen%20to%20approximately%204.6%25%20for%20ten-year%20bonds. Yep. According to Pacifico increased public borrowing costs is good news. |
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Post by Pacifico on Oct 20, 2023 9:48:49 GMT
Yep. According to Pacifico increased public borrowing costs is good news. Well we saw where massive money printing and artificially low interest rates got us - highest inflation in 40 years. Increasing the money supply is guaranteed to lead to higher inflation. |
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Post by zanygame on Oct 20, 2023 17:35:18 GMT
Yep. According to Pacifico increased public borrowing costs is good news. Well we saw where massive money printing and artificially low interest rates got us - highest inflation in 40 years. Increasing the money supply is guaranteed to lead to higher inflation. Inflation was caused by the war in Ukraine and the massive hike in energy prices. How could you pretend otherwise, its both ridiculous and disgusting |
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Post by Pacifico on Oct 20, 2023 21:23:04 GMT
There is no such thing as a free lunch or free money...  |
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Post by steppenwolf on Oct 21, 2023 6:32:44 GMT
Well we saw where massive money printing and artificially low interest rates got us - highest inflation in 40 years. Increasing the money supply is guaranteed to lead to higher inflation.
How could you pretend otherwise, its both ridiculous and disgusting That's caused inflation across Europe and the UK but the reason we have higher inflation is because of the QE experiment. We printed about £500 billion to cover for the debts that Blair/Brown left and we then printed £400 billion more to get us through the furlough/lockdowns. we printed far more money (in proportion to GDP) than anyone else. And we have been very stupid to rely on importing oil and gas when we have our own beneath our feet and in the North Sea. Very stupid. |
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Post by bancroft on Oct 21, 2023 12:39:39 GMT
Steppenwolf is correct you can quite clearly see this on national debt charts.
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