Economy poll

[djjaycool]

Very interesting.


Italy and Portugal are right old skinflints, they haven't loaned the UK a penny piece

Italy, Spain, Portugal and Greece had worrying debt before the euro came into being. The euro will have that drag for years there GDP to debt is a joke along with Ireland.

 

[Bez]

In Europe we dont have the luxury of a federal treasury that just prints money whenever the economy requires it.

The true American debt problem is hidden behind the quantitave easing that the American Treasury ensures.

 

[djjaycool]

In Europe we dont have the luxury of a federal treasury that just prints money whenever the economy requires it.

The true American debt problem is hidden behind the quantitave easing that the American Treasury ensures.

If you have EU bonds that will be the case, just wait and see what happens. I lived in Europe (England, Portugal, Spain, Italy and Germany for 10 years prior to the conversion to the euro and 6 years after; anyone who traveled around will know the cost of living around the Eurozone was not the same.

 

[Bez]

I lived in Europe (England, Portugal, Spain, Italy and Germany for 10 years prior to the conversion to the euro and 6 years after; anyone who traveled around will know the cost of living around the Eurozone was not the same.

Thats the fundamental flaw of the euro project. How were diverse cultures and nationalities expected to all act in fiscal unity to ensure a strong currency???

We are now witnessing what happens when all member states dont adopt fiscal unity.

It was a failed project from the start and thats why Britian stayed out of the Euro as they saw what a risky venture it was.

But then again, who wants to be part of a federal state run by bankers and oligarchies??

 

[djjaycool]

Thats the fundamental flaw of the euro project. How were diverse cultures and nationalities expected to all act in fiscal unity to ensure a strong currency???

We are now witnessing what happens when all member states dont adopt fiscal unity.

It was a failed project from the start and thats why Britian stayed out of the Euro as they saw what a risky venture it was.

But then again, who wants to be part of a federal state run by bankers and oligarchies??

I hate to say this but the UK is involved in everything but the single currency. The UK will feel the pinch just like all the other Eurozone countries. See debt chart

 

[djchewie]

Farage Rant time.

If i was Nige, I'd stay away from light aircraft for a while...


http://www.youtube.com/watch?v=Fyq7WRr_GPg

 

[Bez]

Here is another interesting and thought provoking piece on the whole bubble of Government bonds http://papermoneycollapse.com/2011/...bble-in-government-bonds-is-finally-bursting/

 

[WeLuvIbiza]

Here is another interesting and thought provoking piece on the whole bubble of Government bonds http://papermoneycollapse.com/2011/...bble-in-government-bonds-is-finally-bursting/

Very good and HONEST article. It puzzles me how the markets are at the current levels, must be anticipating a lot more printed money in the short term.

 

[djjaycool]

http://news.yahoo.com/eurozone-ministers-meet-amid-fears-euro-breakup-041312373.html

could be make or break time for the Euro.

 

[Bez]

http://news.yahoo.com/eurozone-ministers-meet-amid-fears-euro-breakup-041312373.html

could be make or break time for the Euro.

Yes its looking that way but it was always going to be a runner since the crisis started.

Nobody has yet to mention the Eastern European and Russian mortgage debt mountain that German, Italian and French banks are badly exposed to. Investors are abandoning the Euro as political inability is damaging the whole project by the second.

Germans will go back to the mark. They will have to endure a few years of inflation and tough economic policies but they will come out of it sooner than the time it will take them to stabilise the Euro Problems.

 

[Robder]

Time to resurrect this thread in the wake of recent events.

France elect a socialist president.

They will undoubtedly join with Greece in rejecting austerity measures.

The right will start to panic.

The Euro will collapse within months (or will it?)...and what does that mean for us?

(esp given that extreme right wing views are rife when poverty increases and the Euro was established to keep the peace after the second world war.)

Interesting times - and definitely not a moment for burying your head in the sand.

 

[djjaycool]

The austerity measure kill economies. If you look at countries with growth they didn't go the went the stimulus route. The French and Greeks can only go so far. A stimulus package is needed across the euro zone, if not recession and unemployment will only get worse. This could be a cliff or rock bottom and take down economies around the world like in 2008.

 

[Robder]

like in 2008.

 

[WeLuvIbiza]

Agree 100% with Robder ^.

It amazes me how those at the top have managed to keep the charade on the road. The world is bankrupt yet very few people are willing to acknowledge this stark truth!

 

[djchewie]

there's no quick fix.

there's no spare cash out there.

but the only thing that is in plentiful supply is impatience.

 

[Johnny Vodka]

'cash' only has meaning for as long as society holds together.

 

[Harry Flowers]

The austerity measure kill economies. If you look at countries with growth they didn't go the went the stimulus route. The French and Greeks can only go so far. A stimulus package is needed across the euro zone, if not recession and unemployment will only get worse. This could be a cliff or rock bottom and take down economies around the world like in 2008.

Given that too much debt was the problem, how is 'stimulus' (i.e. more debt) also the solution?

Serious question - I hear this argument all the time and I genuinely don't understand it.

 

[djchewie]

Given that too much debt was the problem, how is 'stimulus' (i.e. more debt) also the solution?

Serious question - I hear this argument all the time and I genuinely don't understand it.

borrow more money to pump into big projects in the hope to make that money filter down to create jobs, to pay taxes, to make employed people who will spend the money they earn.

Quite how much of £1 a Govt borrows returns to their coffers as some form of tax take is any ones guess. Especially if that £1 is costing an additional pennies in interest.

At the end of the day borrowed money is just that. it has to be paid back at some point.

 

[djjaycool]

Given that too much debt was the problem, how is 'stimulus' (i.e. more debt) also the solution?

Serious question - I hear this argument all the time and I genuinely don't understand it.

This will be as short as I can make it.

Stimulus will keep people employed or help people that are unemployed. Spending on infrastructure and keeping local employees working will keep the economy going until the private sector starts hiring again. State(by this I mean the country) and local employees pay taxes and buy things which spur private growth. If a person has a job or unemployment benefits however small they will spend money. If there is no benefits and no jobs, the private sector employment shrinks as well as the tax base. The private and public sector lays off workers and a recession will only deepen.

The government debt is a concern and should be reigned in, but if you do it in a down turn it will cause recession. take the UK which now has a double digit recession. The USA on the other hand chose the stimulus route has slow steady growth of about 2%. If you look at what the majority of economist say to do this will be the case. The main worry with stimulus is inflation, the government has to watch that and keep it in check. When the tax base and incomes come back then you can tackle the debt. This was done after WW 2 when Europe as a whole was in the tank. Look at the Marshall plan. A lot of people slag off Poland but look at their economy and how it is growing.

 

[MARKB]

Given that too much debt was the problem, how is 'stimulus' (i.e. more debt) also the solution?

Serious question - I hear this argument all the time and I genuinely don't understand it.

If you stimulate the private sector with capital projects, ie infrastructure, regeneration, housing, the theory is that typically this will lead to growth, innovation and employment within the private sector which will in turn lead to more money spent in the economy and more tax revenues etc.

A study was recently undertaken on a £100m infrastructure project which is expected to generate a return of £4 for every £1 spent, in terms of attracting business to the region as the improved infrastructure will attract private sector investment, employment opportunites and further regeneration.

If the goverment spend money wisely, they can stimulate growth. It's not about chucking money at a problem or subsidising false growth by more debt.

Alos, there are many billions of pounds held within the private sector which businesses are holding onto as a safety net, which would otherwise be spent on hiring, expansion etc.

The private sector could unleash this spending power if signals of confidence were forthcoming. In the meantime, what would previously have been a war chest for growth is held onto as a comfort blanket in case times get tougher.