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the UK, the next Iceland
- Thread starter Brendan R
- Start date
Quote from just21:
Running an fx market cannot support 60 million people. A figure the government want to increase to 70 million. I guess if 10 million people turn up and buy a bed then you get economic growth.
so your point is...
The UK has 6 % def, but look around.
Who has the power to spend?
The US and the UK.
No one else. No, not China. They are in full on panic mode.
I used to think the U.S. consumer was the most indebted consumer in the world.
I was wrong.
U.K. consumers are the most indebted in the world. It's quite astonishing:
http://www.theglobeandmail.com/servlet/story/LAC.20081108.RUKPROPERTY08/TPStory/Business
The tastes of fine life begin to go sour for besieged Britons
DOUG SAUNDERS
November 8, 2008
[snippet]
...
"Banks explained that they believe the British consumer has worse crises to come - more jobs lost, more home foreclosures, more business failures - and that there are very few good arguments for opening up mortgage credit in this economy.
"The U.K. household sector is highly indebted, it has higher levels of household debt than anywhere else, and that is a product of upturns in the housing market," said Martin Ellis, chief economist for Halifax, one of the banks that cut its rates yesterday."
I was wrong.
U.K. consumers are the most indebted in the world. It's quite astonishing:
http://www.theglobeandmail.com/servlet/story/LAC.20081108.RUKPROPERTY08/TPStory/Business
The tastes of fine life begin to go sour for besieged Britons
DOUG SAUNDERS
November 8, 2008
[snippet]
...
"Banks explained that they believe the British consumer has worse crises to come - more jobs lost, more home foreclosures, more business failures - and that there are very few good arguments for opening up mortgage credit in this economy.
"The U.K. household sector is highly indebted, it has higher levels of household debt than anywhere else, and that is a product of upturns in the housing market," said Martin Ellis, chief economist for Halifax, one of the banks that cut its rates yesterday."
Quote from Jayford:
so your point is...
The UK has 6 % def, but look around.
Who has the power to spend?
The US and the UK.
No one else. No, not China. They are in full on panic mode.
What is 6% def? The uk has a deficit of about 150% of gdp when you add up debt plus pfi plus northern rock plus bradford and bingley plus public sector pension liabilities. 75% of all gilts bought since 2004 were sold in september. How is the Uk going to fund all the extra spending the delusional PM has promised? Do you want to buy gilts here? Take a look at sterling today, it is testing the october lows. The market does not believe the government lies.
Quote from just21:
What is 6% def? The uk has a deficit of about 150% of gdp when you add up debt plus pfi plus northern rock plus bradford and bingley plus public sector pension liabilities. 75% of all gilts bought since 2004 were sold in september. How is the Uk going to fund all the extra spending the delusional PM has promised? Do you want to buy gilts here? Take a look at sterling today, it is testing the october lows. The market does not believe the government lies.
OK, add all US debts.
Not even close.
I read in Stratfor that the 700 billion bailout plan represents 5% of the GDP of the US.
Is it true that the UK Govt is spending 50% of its GDP to bolster their banking system. If that is the case - and I'd like confirmation from someone in the know -
then it doesn't take a rocket scientist to figure out which economy is in the worst doo doo.
Is it true that the UK Govt is spending 50% of its GDP to bolster their banking system. If that is the case - and I'd like confirmation from someone in the know -
then it doesn't take a rocket scientist to figure out which economy is in the worst doo doo.
from a friend called Fintag....
Bad Parenting.
As the credit crunch morphed into a game of blame, our socialist leaning nanny governments have seen the boundaries of their responsibility move from laissez faire, with the odd detention for bad behavior, to full blown naughty step beatings and confusing messages. Telling a child off but not following up with any form of punishment is the cardinal sin of being a bad parent. Parallel this to governments who have allowed electorates to borrow now and then work out how to pay it off later, whilst doing exactly the same, there is now a divergence in what to do next.
Where as families are tightening their belts, vacationing at home and hanging onto their jobs and future security, their surrogate parents are doing the opposite. Nanny is borrowing more, spending more and then taxing the children. Huge poverty traps are being built as the poor who traditionally spend instead of saving are given huge hand outs and the wealth creators are punished with future tax rises.
The upshot is families will revolt. The black economy will be the new black as we all become equal. Except some will be more equal - the civil servants with jobs for life, index linked pensions and the new haves of a new world of confused children who are being given no guidance or leadership.
The revolt will take the form of an increase in racism, crime and hate. This may seem extreme but history does repeat itself. I can hear the "but this time it is different" and we are more educated and sophisticated. If only that were true. Times ahead are going to be grim unless Obama, the new world leader, can with his advisors break the back of this fastest ever falling bear market in history and provide leadership. Instead he will provide dollars which is fine because the way things stand it is the only currency you want right now.
At the weekend I had dinner with a well known Management Consultant who told me al the CEO's and boards are in absolute panic. Planning is no more on the agenda - now it is knee jerk mass cost cutting and firings and crossing of fingers. The life of many boards of directors will be shorter and shorter and companies will become more inefficient.
Great times of course for trading you might think? Well it is a bit like being on a roller coaster. We have gone down some of the scariest drops, but it is getting dark and we are unsure when the ride ends. That is why most of us are sitting on cash and hibernating for a few months planning on how to move our business offshore.
The UK government has decided to increase income tax. This is a bad move because in this global economy the wealth creators will move and the UK will be one big public sector, lumbering around like a bureaucratic monster trying to devour any wealth creation as it feeds its insatiable hunger for revenue to pay for the life styles of retiring mandarins and pen pushers.
Someone told me 350,000 jobs have been lost in the UK. But in the public sector, they have employed 50,000 more. Nice.
I am currently waiting to board a BA flight to New York. 6 months ago the flight cost GBP5,500. Today it costs just over GBP1,000. This sort of deflation is quite extreme but of course when I arrive in the land of depression, my weak GBP will buy very little. So I am bringing some juggling balls to busk for some dollars. I have worked out that a couple of hours will buy me a 5 bedroom house in Camden Town.
So who is a naughty school boy then?
Bad Parenting.
As the credit crunch morphed into a game of blame, our socialist leaning nanny governments have seen the boundaries of their responsibility move from laissez faire, with the odd detention for bad behavior, to full blown naughty step beatings and confusing messages. Telling a child off but not following up with any form of punishment is the cardinal sin of being a bad parent. Parallel this to governments who have allowed electorates to borrow now and then work out how to pay it off later, whilst doing exactly the same, there is now a divergence in what to do next.
Where as families are tightening their belts, vacationing at home and hanging onto their jobs and future security, their surrogate parents are doing the opposite. Nanny is borrowing more, spending more and then taxing the children. Huge poverty traps are being built as the poor who traditionally spend instead of saving are given huge hand outs and the wealth creators are punished with future tax rises.
The upshot is families will revolt. The black economy will be the new black as we all become equal. Except some will be more equal - the civil servants with jobs for life, index linked pensions and the new haves of a new world of confused children who are being given no guidance or leadership.
The revolt will take the form of an increase in racism, crime and hate. This may seem extreme but history does repeat itself. I can hear the "but this time it is different" and we are more educated and sophisticated. If only that were true. Times ahead are going to be grim unless Obama, the new world leader, can with his advisors break the back of this fastest ever falling bear market in history and provide leadership. Instead he will provide dollars which is fine because the way things stand it is the only currency you want right now.
At the weekend I had dinner with a well known Management Consultant who told me al the CEO's and boards are in absolute panic. Planning is no more on the agenda - now it is knee jerk mass cost cutting and firings and crossing of fingers. The life of many boards of directors will be shorter and shorter and companies will become more inefficient.
Great times of course for trading you might think? Well it is a bit like being on a roller coaster. We have gone down some of the scariest drops, but it is getting dark and we are unsure when the ride ends. That is why most of us are sitting on cash and hibernating for a few months planning on how to move our business offshore.
The UK government has decided to increase income tax. This is a bad move because in this global economy the wealth creators will move and the UK will be one big public sector, lumbering around like a bureaucratic monster trying to devour any wealth creation as it feeds its insatiable hunger for revenue to pay for the life styles of retiring mandarins and pen pushers.
Someone told me 350,000 jobs have been lost in the UK. But in the public sector, they have employed 50,000 more. Nice.
I am currently waiting to board a BA flight to New York. 6 months ago the flight cost GBP5,500. Today it costs just over GBP1,000. This sort of deflation is quite extreme but of course when I arrive in the land of depression, my weak GBP will buy very little. So I am bringing some juggling balls to busk for some dollars. I have worked out that a couple of hours will buy me a 5 bedroom house in Camden Town.
So who is a naughty school boy then?
Banks fall in sharply lower London
http://www.marketwatch.com/news/story/HBOS-Lloyds-TSB-fall-more/story.aspx?guid={C99DA359-79DD-4E19-8D2F-C553BDAF4A2B}
HBOS bad debt charges soar to $7.5 billion
http://www.marketwatch.com/news/story/HBOS-bad-debt-charge-soars/story.aspx?guid={34E5D63C-DF13-4969-9481-667C0BD375CF}
London symbols:
HBOS LLOY RBS BARC HSBA
HBOS
5.41 billion shares
4.74 billion GBP market cap
LLOY
5.97 billion shares
9.56 billion GBP market cap
RBS
39.46 billion shares
26 billion GBP market cap
BARC
8.37 billion shares
13.48 billion GBP market cap
HSBC
12.10 billion shares
90.82 billion GBP market cap
New York:
LYG RBS BCS HBC (HBOS not listed)
http://www.marketwatch.com/news/story/HBOS-Lloyds-TSB-fall-more/story.aspx?guid={C99DA359-79DD-4E19-8D2F-C553BDAF4A2B}
HBOS bad debt charges soar to $7.5 billion
http://www.marketwatch.com/news/story/HBOS-bad-debt-charge-soars/story.aspx?guid={34E5D63C-DF13-4969-9481-667C0BD375CF}
London symbols:
HBOS LLOY RBS BARC HSBA
HBOS
5.41 billion shares
4.74 billion GBP market cap
LLOY
5.97 billion shares
9.56 billion GBP market cap
RBS
39.46 billion shares
26 billion GBP market cap
BARC
8.37 billion shares
13.48 billion GBP market cap
HSBC
12.10 billion shares
90.82 billion GBP market cap
New York:
LYG RBS BCS HBC (HBOS not listed)
CORPORATE BRITAIN FACES £110BN DEBT TIME BOMB
According to data compiled for The Sunday Telegraph by Dealogic, British businesses have £25bn of debt maturing in the form of corporate bonds this year as well as a staggering £85bn of loans.
The lack of funding available to companies was behind the Government's unprecedented £500bn bail-out of the British banking sector last October but the credit markets remain stubbornly frozen, raising fears that companies face annihilation if they are unable to refinance their debt.
According to data compiled for The Sunday Telegraph by Dealogic, British businesses have £25bn of debt maturing in the form of corporate bonds this year as well as a staggering £85bn of loans.
The lack of funding available to companies was behind the Government's unprecedented £500bn bail-out of the British banking sector last October but the credit markets remain stubbornly frozen, raising fears that companies face annihilation if they are unable to refinance their debt.