tag:blogger.com,1999:blog-32841798.post8304942931571488638..comments2024-03-28T22:45:51.014+00:00Comments on Capitalists@Work: Life after Debt? Part1.CityUnslickerhttp://www.blogger.com/profile/15929544047783163175noreply@blogger.comBlogger14125tag:blogger.com,1999:blog-32841798.post-41565598525459596742010-06-30T20:01:53.932+01:002010-06-30T20:01:53.932+01:00After debt?
When?After debt?<br /><br />When?James Highamhttps://www.blogger.com/profile/14525082702330365464noreply@blogger.comtag:blogger.com,1999:blog-32841798.post-49735064674969842892010-06-30T13:08:29.452+01:002010-06-30T13:08:29.452+01:00"At least in the UK we have a Government dete..."At least in the UK we have a Government determined to create a life after debt, more austere perhaps, but a life at least."<br /><br />I don't share your confidence about the government's austerity agenda. It sounds good but, push come to shove, I don't actually believe Nick'n'Dave will follow thru. 25% cuts in public sector spending is very high. I don't see how any govt could survive that, esp when the govt is reliant on the support of a party many of whose parliamentary members don't really share a pro-free market agenda. Heck I don't even think Tory Councillors across England will necessarily share the govt's cuts and policy agenda once they wake up and realise what the implications of it are for their own little fiefdoms. <br /><br />Ultimately more and more reliance will be put in raising taxes and QE and less on cuts. This will serve merely to keep this country in a long drawn out recession with increased intervention of other kinds that we have not seen for decades (e.g., exchange controls, wage and price controls, increased direct govt investment in industry aka the failed policy of picking winners). Some compare Cameron to Tahtcher. To my mind the better comparison is Ted heath - a Prime Minister who came to power with much promise but who within two to three years had done a major about face on economic policy to the despair of his back benchers.not an economisthttps://www.blogger.com/profile/08679610738502901666noreply@blogger.comtag:blogger.com,1999:blog-32841798.post-28273867645635176802010-06-30T01:30:59.003+01:002010-06-30T01:30:59.003+01:00The thing you're missing CU is that the tories...The thing you're missing CU is that the tories <a href="http://pricewagesqueeze.blogspot.com/2010/06/green-ron-omics.html" rel="nofollow">want more off-balance sheet government borrowing</a>.Steven_Lhttps://www.blogger.com/profile/05029437876479574883noreply@blogger.comtag:blogger.com,1999:blog-32841798.post-21797413513614229922010-06-29T14:10:48.681+01:002010-06-29T14:10:48.681+01:00I simply can't see the UK going Japanese. When...I simply can't see the UK going Japanese. When the bubble burst Japan was able to fund its fiscal deficit for 20 years from domestic savings. Japan is also an export economy producing value added goods that the rest of the world wants.<br /><br />There is no way the UK can fund deficits of 150+ billion GBP from domestic savings. The UK will need to rely on foreigners in a world where trillions in sovereign debt needs to be funded or have the Bank of England continue to purchase. <br /><br />This is a situation which is highly unstable and can't continue. Somethings gotta give in a bad way - interest rates or the pound or inflation or default.markhttps://www.blogger.com/profile/05669268286602330607noreply@blogger.comtag:blogger.com,1999:blog-32841798.post-88148268945798940522010-06-29T13:38:01.910+01:002010-06-29T13:38:01.910+01:00I learned much about the Japanese psyche in my stu...I learned much about the Japanese psyche in my study of karate. They have a special word - the word is 'mu'. There is no word like it in our language.<br /><br />I can't give you a direct translation but if we were to answer a question such as:<br /><br />"Is the cat dead or is it alive ?" We could give two answers about its state:<br /><br />- Yes<br />- No<br /><br />The Japanese could give three answers as to whether the cat is dead or alive:<br /><br />- yes<br />-no<br />- mu<br /><br />'Mu' meaning that the cat is neither dead and nor is it alive.<br /><br />Such conceptual neutrality is normal in the Japanese mind.<br /><br />Their economy is mu.<br /><br />I left karate because I began to develop Tourettes.Electro-Kevinhttps://www.blogger.com/profile/18073103431166273080noreply@blogger.comtag:blogger.com,1999:blog-32841798.post-59145872329276003342010-06-29T13:08:04.275+01:002010-06-29T13:08:04.275+01:00The politicos can spout about growth as much as th...The politicos can spout about growth as much as they like but ultimately growth comes down to working harder. <br /><br />As long as we are comfortable due to all the middle class benefits and our wealth is protected by bank bailouts, QE and low interest rates, there will be no incentive to work and things will just drag along.Jonathannoreply@blogger.comtag:blogger.com,1999:blog-32841798.post-76438814770885696352010-06-29T12:48:54.261+01:002010-06-29T12:48:54.261+01:00What we haven't yet heard too much about is ov...What we haven't yet heard too much about is over-regulation and over-legislation. If Cam and Cle can start burning those controls we can have a decent period of catch-up growth even if the tax burden doesn't fall.<br /><br />I don't think the cuts or the debts will be as bad as some think. A modest squeeze to get the state's share of GDP down a bit, a bit of growth and things will look a lot better.Old BEhttps://www.blogger.com/profile/06974090439936326476noreply@blogger.comtag:blogger.com,1999:blog-32841798.post-85119069652404930732010-06-29T12:46:22.963+01:002010-06-29T12:46:22.963+01:00Andrew B -
Is there a 3rd way. I think this is i...Andrew B - <br /><br />Is there a 3rd way. I think this is it, we allow some banks to go under (like we should have let Northern Rock sink), we limit the pain with mild QE to stop market collapses. But we do reform, we don't allow moral hazard to pervert the system a la Japan. <br /><br />A middle path between greek suicide deflation and Japanese euthanasia.CityUnslickerhttps://www.blogger.com/profile/15929544047783163175noreply@blogger.comtag:blogger.com,1999:blog-32841798.post-5768217491679975982010-06-29T11:32:25.892+01:002010-06-29T11:32:25.892+01:00I like jobless hoardes, Steven - great freudian sl...I like jobless <b>hoardes</b>, Steven - great freudian slip !!<br /><br />I predicted fighting in the streets in a little <a href="http://cityunslicker.blogspot.com/2008/09/online-dialectics.html" rel="nofollow">interview</a> 2 years ago ...Nick Drewhttps://www.blogger.com/profile/13670594203660051701noreply@blogger.comtag:blogger.com,1999:blog-32841798.post-13900165632445039692010-06-29T11:14:42.077+01:002010-06-29T11:14:42.077+01:00"...riots, jobless hordes roaming the streets..."...riots, jobless hordes roaming the streets, mad max style."<br /><br />It could probably be quite good fun as long as you still had Sky News and an internet connection.<br /><br />These days, I reckon the jobless hoardes would be more likely to stay at home (or squat with their parents) and play on the XBox.Steven_Lhttps://www.blogger.com/profile/05029437876479574883noreply@blogger.comtag:blogger.com,1999:blog-32841798.post-59950330885262414822010-06-29T10:50:03.581+01:002010-06-29T10:50:03.581+01:00positive on gold!?!positive on gold!?!Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-32841798.post-57142284732315485512010-06-29T10:46:47.765+01:002010-06-29T10:46:47.765+01:00So, based on this analysis, what should one do :
-...So, based on this analysis, what should one do :<br />- Avoid Europe<br />- Neutral on UK<br />- Positive on ... <br /><br />?Andrew Bhttps://www.blogger.com/profile/17537364534559092034noreply@blogger.comtag:blogger.com,1999:blog-32841798.post-49231442517560559072010-06-29T10:44:43.199+01:002010-06-29T10:44:43.199+01:00It does occur to me that the Japanese experience i...It does occur to me that the Japanese experience is possibly the best scenario we can hope for. IE the world does not end in a Depressionary slump, with riots, jobless hordes roaming the streets, mad max style. Which is entirely possible if we entered a downward spiral of mass bankruptcy, much lower asset prices, more unemployment, more bankruptcy etc etc.<br /><br />Instead QE and government debt keeps everything on a even keel. No rise in the level of national wealth, everyone just bumping along, keeping body and soul together (just). <br /><br />Of course you have to remember also that Japan is in trouble too - its debt burden is unsustainable long term.At some point they will go the way of Greece. Its just a matter of time when the markets call time.<br /><br />But if you offer our politicians the choice of 20 years of no growth but generally stable national life, vs massive social upheaval as all the debt is liquidated in short order, I reckon they'll choose the former every time. And the electorate might too, if they were ever asked.sobersnoreply@blogger.comtag:blogger.com,1999:blog-32841798.post-62021908852527584412010-06-29T10:28:25.806+01:002010-06-29T10:28:25.806+01:00The UK, and Europe, have gone down the Japanese ro...The UK, and Europe, have gone down the Japanese route.<br /><br />Zombie banks stalk the landscape, unwilling to disclose their balance sheets in full and addicted to quirky central bank funding schemes, swapping toxic collateral for liquidity.<br /><br />The authorities are complicit here, trying to prop up the banks and rushing to rescue at the merest wobble.Marconoreply@blogger.com