Rolling UK Economy Into The Shitbin Thread

Might be good (haven't heard yet):

http://www.bbc.co.uk/radio4/factual/pip/i2uff/

― toby, Tuesday, 22 January 2008 13:36 (5 years ago) Permalink

I can't work out whether I hate the heads buried in the sand or the self-fulfilling prophecy style doom-mongering more at the moment. If you can keep your job and keep your debt down to a manageable level you'll be fine.

― Matt DC, Tuesday, 22 January 2008 13:37 (5 years ago) Permalink

Formal complaint by Radiohead: recession and debt worries cause low sales of limited edition £40 In Rainbows discbox. "Don't people WANT the future? What's so cool about food?" quipped Thom Yorke at a press conference, adding, "Gordon Brown is a safe pair of hands. I've got all his records at home - sorry, who is it we're talking about again?"

― Dingbod Kesterson, Tuesday, 22 January 2008 13:39 (5 years ago) Permalink

self-fulfilling prophecy style doom-mongering

"we're in danger of talking ourselves into a recession"???

― laxalt, Tuesday, 22 January 2008 13:43 (5 years ago) Permalink

I can't work out whether I hate the heads buried in the sand or the self-fulfilling prophecy style doom-mongering more at the moment. If you can keep your job and keep your debt down to a manageable level you'll be fine.

-- Matt DC, Tuesday, January 22, 2008 1:37 PM (6 minutes ago) Bookmark Link

i think the heads-buried thing just about steals this, because it's been going on for SUCH A LONG TIME.

― That one guy that hit it and quit it, Tuesday, 22 January 2008 13:44 (5 years ago) Permalink

Hey guys with some positive thinking perhaps we can talk ourselves into another boom

― laxalt, Tuesday, 22 January 2008 13:45 (5 years ago) Permalink

No I was saying that hysterical media coverage tends to exacerbate pre-existing problems, same as anything.

― Matt DC, Tuesday, 22 January 2008 13:48 (5 years ago) Permalink

true. the headline of daily mail is asking for the same panic measures bernanke just dished out in the US.

― laxalt, Tuesday, 22 January 2008 13:49 (5 years ago) Permalink

though to be fair..i think the media has downplayed the economic situation over the last 6 months (its amazing its taken this long for the stock market to do this!)

― laxalt, Tuesday, 22 January 2008 13:50 (5 years ago) Permalink

Who the hell was gambling on the stock market between august and today?

― laxalt, Tuesday, 22 January 2008 13:51 (5 years ago) Permalink

Kate McCann?

― Dingbod Kesterson, Tuesday, 22 January 2008 13:54 (5 years ago) Permalink

she was too busy shaving

― darraghmac, Tuesday, 22 January 2008 13:59 (5 years ago) Permalink

the BBC market data system (the back end that provides live updates of financial markets) has had so many requests today that it has fallen over

― Tracer Hand, Tuesday, 22 January 2008 16:25 (5 years ago) Permalink

― darraghmac, Tuesday, 22 January 2008 16:30 (5 years ago) Permalink

basically

― Tracer Hand, Tuesday, 22 January 2008 16:31 (5 years ago) Permalink

self-fulfilling prophecy style doom-mongering more at the moment.

actually this really doesn't make any sense.

1. it wasn't really until this month that the press bothered with any of this beyond house prices (and even then they were spinning 'a year of stagnation') and northern rock (often treated as some kind of weird one off). Lower house prices in themselves are not 'doom-mongering' at all anyway, as they (theoretically) make it easier for first time buyers (though in practice it doesn't work out this way)

I haven't seen much 'recession coverage' anywhere other than the independent, until the last few days, and the redtops still haven't even touched it at all!

2. I just can't buy it being a self-prophecy coming true. I don't think ANY of the coverage has been doom-mongering for the simple fact that i think the facts are much worse than have been reported and it is precisely this which means every event is somehow a 'shock, when it was obvious for a long time

― laxalt, Tuesday, 22 January 2008 16:33 (5 years ago) Permalink

cf. the date this thread was started

― Tracer Hand, Tuesday, 22 January 2008 16:37 (5 years ago) Permalink

Well we did tag along on that thatcher thread for a while, but yes the thread should have been started last summer really

― laxalt, Tuesday, 22 January 2008 16:39 (5 years ago) Permalink

haha woops i thought this was the "will the housing bubble be worse than the dotcom bubble" thread, which was started about two years ago

― Tracer Hand, Tuesday, 22 January 2008 16:40 (5 years ago) Permalink

which, as a pre-emptive thread was probably a couple years too late even then

― laxalt, Tuesday, 22 January 2008 16:44 (5 years ago) Permalink

1. Not true - I've seen this covered at length in the Guardian, Times, Telegraph, FT (pretty much every day obviously), and to a lesser extent the Mail. As far as I can remember most of these has taken the 'may tip the global economy into recession' line which seems a sensible one to take.

2. I'm not saying there isn't going to be a recession (its likely there will be, there may just be a significant slowdown). In what way are the events of the last couple of days a shock to anyone who has taken even a passing interest over the last couple of weeks? The Indy a few weeks ago hd a front of enormous stormclouds gathering over Britain with 'THE PERFECT STORM' written on it, that's pretty doom-mongering isn't it, regardless of whether or not they were right?

― Matt DC, Tuesday, 22 January 2008 16:45 (5 years ago) Permalink

Okay lets get the basics down before we go any further:

- When politicans keep saying "the economic fundamentals are sound" are we to assume they're just bullshitting?

- What was it that enabled Britain to ride out the recession in the early 00s? Presumably the conditions are so different this time around that this couldn't happen again?

- Assuming an ILX thread four years ago could have prevented this, what could people have done to prevent this in the early 00s?

― Matt DC, Tuesday, 22 January 2008 16:51 (5 years ago) Permalink

1. 'may tip' is hardly excessive

2. they were a shock to those people who hadn't got themselves out of shares

The Independents headlines are always like that about everything, but I don't think that perfect storm headline was doom-mongering at all. 'perfect storm' refers to a series of events that were already well underway

if the fundamentals of the uk economy are strong, as we are told, then they will not be shaken by newspaper headlines as people would take advantage of the uncertainty. but the fundamentals of the uk economy are not strong in the slightest
(relying on unemployment data is downright dishonest)

I would still suggest that this is merely a difficult year, next year worse, but 2010 probably the big one. I still think that the press has glossed over how bad this is, even now

― laxalt, Tuesday, 22 January 2008 16:52 (5 years ago) Permalink

but 2010 probably the big one

Oh well then, fuck it, we've got to two more years to party

― Tom D., Tuesday, 22 January 2008 16:53 (5 years ago) Permalink

-When politicans keep saying "the economic fundamentals are sound" are we to assume they're just bullshitting?

yes, its called positive spin. they rely on two things

1) inflation. believe that?
2) unemployment. always the last domino to fall, because jobs get cut because outlook is bad, not the other way round

- What was it that enabled Britain to ride out the recession in the early 00s? Presumably the conditions are so different this time around that this couldn't happen again?

because there was a huge shift of debt from industry/govt to consumers, the british public basically took on the debt, ie we spent our way out of it. or, rather more to the point, we BORROWED our way out of it, and got very heavily in debt. the proposed solution appears to borrow and spend some more

- Assuming an ILX thread four years ago could have prevented this, what could people have done to prevent this in the early 00s?

thats a much longer question, but nipping speculative bubbles in the bud is a good start, and perhaps actually taking that recession then, rather than this bigger one now. also, engaging in productive activities, rather than speculation

― laxalt, Tuesday, 22 January 2008 16:55 (5 years ago) Permalink

basically, you cant put off recessions, they've been happening for 300+ years! if you put them off you store them up for later. banks lend lend lend, contraction occurs, people get caught high and dry

― laxalt, Tuesday, 22 January 2008 16:58 (5 years ago) Permalink

Oh well then, fuck it, we've got to two more years to party

comparatively, i think this year will be very bad, but it will get worse after that before it improves

― laxalt, Tuesday, 22 January 2008 16:59 (5 years ago) Permalink

- Assuming an ILX thread four years ago could have prevented this, what could people have done to prevent this in the early 00s?

- given frank the success they deserved
- adopted 'hen fap' meme
- film threads

― That one guy that hit it and quit it, Tuesday, 22 January 2008 17:00 (5 years ago) Permalink

- rockism
- geezaesthetics

― DG, Tuesday, 22 January 2008 17:03 (5 years ago) Permalink

I mean, i'd love to hear an economic fundamental other than 2% inflation (your loaf of bread, train ticket, gas bill, petrol go up by 2% this year?) and low unemployment, but that seems to be it! perhaps its our industries of finance (um), housing (er), buying with our credit cards (weelll...)?

― laxalt, Tuesday, 22 January 2008 17:03 (5 years ago) Permalink

- realized why 1974 is crucial here

― That one guy that hit it and quit it, Tuesday, 22 January 2008 17:04 (5 years ago) Permalink

- marcello carlin 'character'

― DG, Tuesday, 22 January 2008 17:05 (5 years ago) Permalink

perhaps its our industries of finance (um), housing (er), buying with our credit cards (weelll...)?

This is the problem really, the economy of this country is over-reliant on the City, we don't make anything* we just shunt money around. This would never have happened under Becky Lucas.

*Not much good either if export markets slump as well.

― Matt DC, Tuesday, 22 January 2008 17:21 (5 years ago) Permalink

So, really, that 'economic fundamentals are sound' looks exactly like bullshit

― laxalt, Tuesday, 22 January 2008 17:24 (5 years ago) Permalink

GORDON BROWN: It's all the more remarkable that inflation generally is low, when you have, as everybody acknowledges, rising food prices round the world and rising oil and commodity prices.

http://news.bbc.co.uk/2/hi/programmes/politics_show/7202283.stm

It's all the more remarkable that black is generally white

― laxalt, Sunday, 27 January 2008 14:16 (5 years ago) Permalink

TWO in every five employers plan redundancies over the next three months, according to an influential survey to be published tomorrow. It comes as two leading business groups warn of weak business confidence and a sharp slowdown in growth.

Retailers had been very downbeat about prospects for January following a poor December, with like-for-like sales rising only 0.3%. This week’s figures will come as a relief, but the BRC is likely to warn that any strength is likely to be temporary.

This will be the big fear if the warning of many redundancies from the Chartered Institute of Personnel and Development comes true. Its winter labour market outlook, also in conjunction with KPMG, is set to show that 38% of the more than 1,500 employers surveyed plan redundancies over the next three months, with a quarter intending to let go at least 10 employees.

Although it is normal for a proportion of employers to be planning redundancies, the latest figure is sharply up on the 17% number three months ago.

http://business.timesonline.co.uk/tol/business/economics/article3340863.ece

― Tracer Hand, Monday, 11 February 2008 14:58 (5 years ago) Permalink

and to think i took public service job last year 'just until something better comes along'.

― darraghmac, Monday, 11 February 2008 15:06 (5 years ago) Permalink

"Everything is OK because unemployment is low" can never be a good barometer of anything. Things aren't OK because unemployment is low! Its the other way round. Unemployment is low when things are OK. More accurately - unemployment is low when future outlook suggests more people will be needed to do/make things/services. Obviously the future outlook for the economy is very poor - therefore people will be let go

― laxalt, Monday, 11 February 2008 15:57 (5 years ago) Permalink

Unless of course people go on long term incapacity benefit - in which case unemployment can carry on being as low for as long as you like

― laxalt, Monday, 11 February 2008 15:58 (5 years ago) Permalink

Recession claims first casualty

― Nasty, Brutish & Short, Thursday, 14 February 2008 09:15 (5 years ago) Permalink

Unless of course people go on long term incapacity benefit - in which case unemployment can carry on being as low for as long as you like

-- laxalt, Monday, February 11, 2008 3:58 PM (3 days ago) Bookmark Link

^^^ this. unemployment isn't low. people claiming JSA is comparatively low. depends how you slice and dice the figures innit.

― That one guy that hit it and quit it, Thursday, 14 February 2008 09:18 (5 years ago) Permalink

How nice that the Times should include a detailed definition of the term "bankruptcy" in that Statto piece for the benefit of all those thrusting Thatcherkids who haven't got time to learn English. Still I suppose many thrusting Thatcherkids will know what the word means soon enough.

― Dingbod Kesterson, Thursday, 14 February 2008 10:02 (5 years ago) Permalink

― Ned Trifle II, Thursday, 14 February 2008 10:13 (5 years ago) Permalink

― laxalt, Thursday, 14 February 2008 10:23 (5 years ago) Permalink

how long till first "UNGRATEFUL IMMIGRANTS ABANDON UK: after taking advantage of our hospitality, mercenary poles and russians look to leave UK when going gets rough, proving they WERE only ever interested in our money" type stuff in the Daily Angry

― laxalt, Thursday, 14 February 2008 10:30 (5 years ago) Permalink

It was in the Metro already this morning.

― Matt DC, Thursday, 14 February 2008 10:32 (5 years ago) Permalink

bah

― laxalt, Thursday, 14 February 2008 10:37 (5 years ago) Permalink

(It actually was! Something about 'Poles abandon failing Britain')

― Matt DC, Thursday, 14 February 2008 10:40 (5 years ago) Permalink

looooooool

― That one guy that hit it and quit it, Thursday, 14 February 2008 10:40 (5 years ago) Permalink

Looks like recession here is going to move much quicker than it has been arriving in the US

― laxalt, Thursday, 14 February 2008 10:44 (5 years ago) Permalink

so has ed milliband actually said anything about this yet?

― caek, Tuesday, 9 August 2011 22:34 (1 year ago) Permalink

ha, wrong thread, but i guess it works here too.

― caek, Tuesday, 9 August 2011 22:34 (1 year ago) Permalink

awaiting policy review iirc

― full on... mask hysteria (history mayne), Tuesday, 9 August 2011 22:43 (1 year ago) Permalink

there are a few 'i agree' kinda things on his twitter account. really feel like he could seem sorta persuasive if he said like, thoughtful things he probably thinks, but he seems a bit trapped in trying to sound like a guy who is able to say the right boilerplate politician things, for the most part, as a demonstration of his grown-up real-and-viable politician skills. like banal 'my heart is with the people of _____' platitudes.

― bruce actual springsteen (schlump), Tuesday, 9 August 2011 22:54 (1 year ago) Permalink

― full on... mask hysteria (history mayne), Wednesday, 10 August 2011 22:32 (1 year ago) Permalink

― Rory's new misogynist car (Gukbe), Tuesday, 27 September 2011 03:30 (1 year ago) Permalink

.

― henri grenouille (Frogman Henry), Tuesday, 27 September 2011 10:42 (1 year ago) Permalink

the good people of twitter are coming around to the opinion that it's a Yes Men stunt?

have been trying to find mention of 'alessio rastani' on the interwhat prior to april 2010 (that's quite a long game!) but it's rendered surprisingly hard by automated news tickers/rss type things - google brings up pages ostensibly from 2007 but with recent headlines etc on 'em.

― civilisation and its discotheques (c sharp major), Tuesday, 27 September 2011 11:03 (1 year ago) Permalink

that would be so awesome.

― TracerHandVEVO (Tracer Hand), Tuesday, 27 September 2011 11:06 (1 year ago) Permalink

i can't decide whether it would or not! if it's a stunt, then wouldn't it be easier for people to ignore?

i am pretty bad at faces but it didn't seem to me that this was the same man as the Bhopal disaster interview, this one is so much younger.

― civilisation and its discotheques (c sharp major), Tuesday, 27 September 2011 11:11 (1 year ago) Permalink

Yeah, reading the Yes Men theories now as well. Soz about that.

Still, I wonder what percentage of people who saw it were disgusted v the percentage of people who went to look up "how to make money in a downmarket"

― Rory's new misogynist car (Gukbe), Tuesday, 27 September 2011 14:49 (1 year ago) Permalink

if it's a stunt, then wouldn't it be easier for people to ignore?

it's gotten through to enough people already to have made a difference i think.

― TracerHandVEVO (Tracer Hand), Tuesday, 27 September 2011 14:58 (1 year ago) Permalink

His advice to protect your assets as best you can is very good advice right now.

The great majority of ilxors have few or no assets other than their skills and abilities. Sadly, in a cash famine and deflationary spiral (which is what this guy is obv predicting) there is no good way to protect those assets, since they must be converted to cash to become negotiable. Therefore, the best strategy would be to reduce debt, save as much as you can from your present earnings, and keep your powder dry. Also, evaluate your skill set and try to strengthen it by adding as many valuable skills as you can.

― Aimless, Tuesday, 27 September 2011 15:52 (1 year ago) Permalink

So the dude is kind of a fraud, but not a hoaxer.

― Rory's new misogynist car (Gukbe), Tuesday, 27 September 2011 20:17 (1 year ago) Permalink

"Not only are we going to be in debt to the bank, we're also in debt to our parents... we're probably never going to afford to get married, and god forbid we ever decide to have a child. I've worked my arѕe off, (so) how the hell has this happened?"

http://uk.reuters.com/article/2012/01/05/uk-housing-analysis-idUKTRE8040EK20120105

― TracerHandVEVO (Tracer Hand), Saturday, 7 January 2012 02:03 (1 year ago) Permalink

speaking of houses the benefit cap comes into effect this week i think?

― TracerHandVEVO (Tracer Hand), Saturday, 7 January 2012 02:05 (1 year ago) Permalink

"Not only are we going to be in debt to the bank, we're also in debt to our parents... we're probably never going to afford to get married, and god forbid we ever decide to have a child. I've worked my arѕe off, (so) how the hell has this happened?"

i've had a few and it's late here so i'm not pumped to get into it but it seems to me that this kind of argument, which you hear a lot re: the recession/economic climate/decline of the West/whatevs is loaded with entitlement and ahistoricity and point-missing and it doesn't pull at the heart or brain-strings as to why we're at the evil end of an evil age

― the white plies (Noodle Vague), Saturday, 7 January 2012 02:10 (1 year ago) Permalink

they're using the word ARSE in a reuters article next thing it will be big bottom this and blood sausage that all over the newsy wewsies

― hegel-lacan girl (nakhchivan), Saturday, 7 January 2012 02:12 (1 year ago) Permalink

nv otm, difference being i'm sober

― carpy deems (darraghmac), Saturday, 7 January 2012 02:23 (1 year ago) Permalink

i feel bad for the dude if he can't afford to get married tho, it's only 60 quid

― the white plies (Noodle Vague), Saturday, 7 January 2012 02:27 (1 year ago) Permalink

yah god forbid those feebs ever have kids

― hegel-lacan girl (nakhchivan), Saturday, 7 January 2012 02:28 (1 year ago) Permalink

housing is a universal right oh and also a maketable good oh and also yr pension kthxbye

UK/Irish govts, 1993-2007

― carpy deems (darraghmac), Saturday, 7 January 2012 02:29 (1 year ago) Permalink

yeah the demise of the benevolent blair govt really saw told to that

― hegel-lacan girl (nakhchivan), Saturday, 7 January 2012 02:30 (1 year ago) Permalink

Britons' love affair with housing on rocks

big improvement on previous gov's love affair with housing on sand

― the white plies (Noodle Vague), Saturday, 7 January 2012 02:31 (1 year ago) Permalink

i can't even look at that 2nd rate brian connelly who played blair tbh, let alone think about the baldingrinning prickdemon himself

― carpy deems (darraghmac), Saturday, 7 January 2012 02:36 (1 year ago) Permalink

I was thinking about this in relation to the divide-and-rule talk that's being going on this week. The anger felt by people who are in that situation is entirely justified but seems to be increasingly turned against those propped up by child support and housing benefit, rather than those responsible for the root causes of why couples earning 60k between them don't feel like they can afford homes and families. There's a well of legitimate outrage building up - i'm not sure how it can be harnessed to point in the right direction at the moment.

― Mohombi Khush Hua (ShariVari), Saturday, 7 January 2012 08:44 (1 year ago) Permalink

tbf it can be both

― carpy deems (darraghmac), Saturday, 7 January 2012 17:51 (1 year ago) Permalink

FT blazing all guns

Cameron is consigning the UK to stagnation

By Martin Wolf
Can it make sense for policy makers to stick with their policies, regardless of adverse changes in circumstances and outcomes? David Cameron thinks not. In a speech earlier this week, Britain’s prime minister advises the eurozone to change its monetary policies and fiscal institutions. But what does he think about the policies his government is following at home? On that he is not for turning. The policies decided when the coalition came into office two years ago are, he insists, also correct now.

The world, eurozone and UK economies are in a far worse state than expected. Yet Mr Cameron insists that “we are moving in the right direction”. Who is this “we”? UK gross domestic product is stuck at 4 per cent below its pre-crisis peak in what is the longest such slump since the 19th century, with no end in sight. Even if one believes that part of the pre-crisis output was an illusion, why should one accept that the UK economy has lost the capacity to grow altogether? How can Mr Cameron believe the economy is moving in the right direction when it is not moving?

The reason Mr Cameron believes this is because he is fixated not with the dire economic performance, but with the public sector’s balance sheet – and not even the whole balance sheet, but with its liabilities. “We cannot blow the budget on more spending and more debt,” he says.

Yet if not now, when? As Jonathan Portes, director of the National Institute of Economic and Social Research, argues in a recent blog post: “With long-term government borrowing as cheap as in living memory, with unemployed workers and plenty of spare capacity, and with the UK suffering from both creaking infrastructure and a chronic lack of housing supply, now is the time for government to borrow and invest. This is not just basic macro-economics, it is common sense.”

With real interest rates close to zero – yes, zero – it is impossible to believe that the government cannot find investments to make itself, or investments it can make with the private sector, or private investments whose tail risks it can insure that do not earn more than the real cost of funds. If that were not true, the UK would be finished. Not only the economy, but the government itself is virtually certain to be better off if it undertook such investments and if it were to do its accounting in a rational way. No sane institution analyses its decisions on the basis of cash flows, annual borrowings and its debt stock. Yet government is the longest-lived agent in the economy. This does not even deserve the label primitive. It is simply ridiculous.

The results, however, are not at all ridiculous. They are extremely costly to both the economy and society. Yet, instead of taking advantage of the opportunity of a lifetime to repair and upgrade the capital stock, as Mr Portes notes: “Public sector net investment – spending on building roads, schools and hospitals – has been cut by about half over the past three years, and will be cut even further over the next two.”

He recommends a £30bn investment programme (about 2 per cent of GDP). I would go for far more. Note that the impact on the government’s debt stock would be trivial even if it brought no longer-term gains. Indeed, it would be modest at many times this level.

It is a scandal that in an exceptionally severe downturn, the Treasury, in its majestic unwisdom, slashed its investment so deeply. Penny wise, pound-foolish does not come close to it. As Brad de Long of Berkeley and Larry Summers of Harvard argue in a paper that I have commented on in the Wolf Exchange blog, with a positive impact on output and modest “hysteresis” effects (permanent costs from high unemployment and low activity), extra spending can pay for itself.

Why is the government determined to stick to its plans even though the weak economy has led to far higher borrowing than originally expected? The answer is that it is terrified of what Warren Buffett calls “Mr Market”. It believes that if it raised investment and supported demand, the market for its bonds would not just fall – as one must hope it would, once recovery came – but collapse. Yet a country with huge private sector financial surpluses, a floating exchange rate and an independent central bank is most unlikely to experience the runs it fears, as I have recently argued in the Wolf Exchange. The eurozone is simply a different case. It is more likely that the bond markets would collapse if the economy did not recover and so huge deficits continued indefinitely.

In its fear of the spectre of a bond price collapse, the government is consigning the UK to stagnation. It is refusing to take advantage of the borrowing opportunities of a lifetime. It is unwilling to contemplate even a clearly time-limited fiscal boost out of fear that the gilt markets would promptly panic. It is determined to persist with its course, regardless of the unexpectedly adverse changes in the external environment. The result is likely to be a permanent reduction in the output of the UK, not to mention permanent damage to a whole generation of the unemployed. I have words for such behaviour. Not on this list is the word “sensible”.
- http://www.ft.com/cms/s/0/5853d1c0-9ea9-11e1-9cc8-00144feabdc0.html

― reg required, Friday, 18 May 2012 11:23 (1 year ago) Permalink

GDP fell by 0.7% in the last quarter, much worse than expected.

― Özil Gummidge (Nasty, Brutish & Short), Wednesday, 25 July 2012 09:17 (9 months ago) Permalink

so psyched for the next Tory government

― Tartar Mouantcheoux (Noodle Vague), Wednesday, 25 July 2012 09:20 (9 months ago) Permalink

uk gilts now at an all-time low of 0.04%, so this massive deficit that we absolutely must cut down as soon as possible could in fact be largely refinanced into an interest-free loan.

But, yes, let's stop everything until we've paid back all the 0% money. This is like somebody not buying food until they've paid off their entire student loan as fast as possible. It's just financially illiterate.

― stet, Thursday, 26 July 2012 11:02 (9 months ago) Permalink

(i mean, okay that's the 2yr, but even the 10yr is sitting at 1.4%, compared to 5% at the time of the bailout)

― stet, Thursday, 26 July 2012 11:05 (9 months ago) Permalink

Cameron refusing to budge. Won't the Lib Dems just revolt?

― Legendary General Cypher Raige (Gukbe), Thursday, 26 July 2012 14:57 (9 months ago) Permalink

Of course they won't. Revolt = electoral oblivion.

― Matt DC, Thursday, 26 July 2012 14:59 (9 months ago) Permalink

surely that'll happen either way?

― Legendary General Cypher Raige (Gukbe), Thursday, 26 July 2012 15:00 (9 months ago) Permalink

We're all going to die either way, doesn't mean don't want to put it off for as long as possible.

― Matt DC, Thursday, 26 July 2012 15:04 (9 months ago) Permalink

Now taking us longer to get out of this than it did the great depression:
http://www.zerohedge.com/news/forget-double-dip-uk-now-depression

― stet, Thursday, 26 July 2012 15:06 (9 months ago) Permalink

here we go http://www.bbc.co.uk/news/business-19174649

― caek, Wednesday, 8 August 2012 12:53 (9 months ago) Permalink

this cyprus thing is bananas

― caek, Sunday, 17 March 2013 14:55 (2 months ago) Permalink

http://www.economist.com/blogs/schumpeter/2013/03/cyprus-bail-out

Whatever the rationale, it is a mistake for three reasons. The first error is to reawaken contagion risk elsewhere in the euro zone. Depositors have come through the financial crisis largely unscathed. Now they have been bailed in, some of them in breach of an explicit promise that they can be sure of getting their money back even if a bank goes belly-up.

Euro-zone leaders will spin the deal as reflecting the unique circumstances surrounding Cyprus, just as they did the Greek debt restructuring last year. But if you were a depositor in a peripheral country that looked like it needed more money from the euro zone, what would your calculation be? That you would never be treated like the people in Cyprus, or that a precedent had been set which reflected the consistent demands of creditor countries for burden-sharing? The chances of big, destabilising movements of money (into cash, if not into other banks) have just shot up.

The second error is one of equity. There is an argument to be made over the principles of bailing in uninsured depositors. And there is a case for hitting everyone in Cypriot banks before any taxpayer in another country. But there is no moral imperative for whacking Cypriot widows and leaving senior bank bondholders untouched, as appears to be the case here; or not imposing any losses on sovereign-debt investors in Cyprus; or protecting depositors in the Greek operations of Cypriot banks, as has also happened. The euro zone may cloak this bail-out in the language of fairness but it is a highly selective treatment. Indeed, the euro zone’s insistence that this is a one-off makes that perfectly plain: with enough foreigners at risk and a small enough country to push around, you get an outcome like Cyprus. (That is one reason why people are now wondering about the implications of this deal for little Latvia, also home to lots of Russian money and itself due to join the euro zone in 2014.)

The final error is strategic. The Cypriot deal has no coherence in the larger context. The euro crisis has been in abeyance for a few months, thanks largely to the readiness of the European Central Bank to intervene to help struggling countries. The ECB’s price for helping countries is to insist they go into a bail-out programme. The political price of going into a programme has just gone up, so the ECB’s safety net looks a little thinner.

― caek, Sunday, 17 March 2013 14:57 (2 months ago) Permalink

is there a better thread for this?

― caek, Sunday, 17 March 2013 14:57 (2 months ago) Permalink

I started this one but nobody posted to it: The Eurozone Crisis Thread

― Gukbe, Sunday, 17 March 2013 14:59 (2 months ago) Permalink

thanking you i will post there

― caek, Sunday, 17 March 2013 15:00 (2 months ago) Permalink