Saturday, Aug 30, 2008
Labour Government Admits Living in a Fools Paradise
Guardian: Economy at 60-year low, says Darling. And it will get worse
Chancellor Darling admits that he was clueless as to how serious the credit crunch would become and declares that Britain is now facing "arguably the worst" economic downturn in 60 years which will be "more profound and long-lasting" than people had expected .
Posted by enuii @ 11:33 PM (5601 views) Add Comment
92 Comments
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1. Herrbbiiee said...
The puppet breaks loose from Broon....
2. Tenyearstogetmymoneyback said...
Sounds like a case of "It's not my fault"
which is true.
I wonder if the previous Chancellor has apologied for leaving things in such a mess ?
3. renting2 said...
He's admitted "arguably the worst" for 60 years. How long before it becomes "worse than the Great Depression"?
4. jack c said...
They (AD & Co) decide it's time to connect with the people by resorting to foul language ie "they have "patently" failed to explain the party's central mission to the country, leaving voters "pissed off" & "We've got to rediscover that zeal which won three elections, and that is a huge problem for us at the moment. People are pissed off with us" - they are even repeating this garbage word for word on Radio 4 this morning !
People are p****d off because NU Labour (or whatever they call themselves these days) are simply bereft of ideas and clearly not upto the job. The only tangible results from this government is sufficient red tape to stretch from here to Mars and back.
5. Mike said...
It's a complete failure by Darling to even say such things. Now it's more likely to come true and we will all go in even more depressed on Monday morning!
It's all the governments fault. The tax system is in a mess and it's time the 'leaches' who made their money under Nu-Labour left. For too long there are too many people on huge salaries who don't deserve it. This makes the whole system in-efficient and when the money runs out it makes us liable to one huge country-wide crash the likes of which have never been seen in a very long time.
6. Adam said...
Why on Gods green Earth do we have someone who trained as a lawyer running the economy? Any Economics undergraduate from a half decent university could see this coming. There was no intervention when everything was coming up roses, so why are they even thinking about doing anything? It's all futile anyway, he can't stop the tide of market correction any more than King Canute couldn't stop the real one. Hopefully the outcome for Darling and Labour will be the same!
7. Quad said...
its time we all woke up both individually and collectively, the economic situation in this country is going to get very bad in the comming years.
we need to look at ways of improving industry. by getting the finest creative, invententive, people and combine them with the finest business people, and the best marketing people and encourage the to get together and and design and make stuff. so the uk can compete with the rest of the world once again.
along with this, elect a buch of polititians who are interested in putting in place an economic structure which favours british interests above others, who are willing to swing the axe to any policy which prevents this.
look at ways of bringing important infrastucture back in to brisitsh ownership, so we are not at the mercy of invetors profits over, improvement of services.
lets all learn from the mistakes, that have been made and, lets get this country, producing and inventing and creating again.
8. enuii said...
Having slept on this one I now believe that they are possibly intending to put as much Negative Spin on the issue as possible so as soon as things do pick up for whatever reason they can claim it as a success and put loads of Positive Spin into the media to bolster their chances at the next election.
Politicians trying to look after Number 1 I'm afraid and that isn't the General Populace.
9. plato said...
NO : We are living in a fools paradise. They are milking it. That is the truth. Only they can't hide it forever.
10. enuii said...
Decent honest politicians (if there is such a thing) would not let their fellow citizens live in a fools paradise and would have made sure that the existing norms with regard to income multiples and checks were rigidly adhered to in order to protect deluded citizens from themselves. Unfortunately in the NeuLiebor pay-as-you-go society that is not good for the governmental coffers.
11. Dbc Reed said...
What makes it more worrying is that the Conservatives are even more bereft of ideas : they are the traditional house price party which ended the long period of flat house values by getting rid of Schedule A of Income tax on rental values and expanding the money supply recklessly in the 60's and 70's.
Things started going haywire on their watch (Heath and Barber's) and in the forty years following ( an adult lifetime) they have been faffing about ,quite happily destroying the country's industrial base after blaming the workers for inflation ( though '' innocent as new born lambs ,white as the driven snow'' observed Enoch Powell their one-man awkward squad).
In the meantime the Labour and Liberal Parties fell in line,not daring to do anything to offend the burgeoning owner-occupier electoral majority like restoring a tax on property while hoses of cheap credit were directed at the housing market
We now have a corrupt political system where democracy is undermined by the privileged status of the property-owning class.The Conservatives are pretty obviously making it up as they go along,and in no state to replace Labour,being represented by Bullingdon Club thickies.
12. renting2 said...
Or perhaps paving the way for all those 'initiatives'. Making the council mortgage and buy-out schemes look like the only possible alternative available.
13. a saver said...
Good to hear a little of the truth from the guy who stood up and boldly talked about sound fundamentals and 2% growth for the UK just a few months ago - but it all sounds like efforts to win back voters rather than ideas for getting us out of this mess. It's as if his advisers have been saying look Al they're starting to realise the game is up so you're going to have to give them a little bit of honesty.
I'd be less unimpressed if he said look guys people did warn us but we've still been caught on the hop, we should have realised and we're going to stop wasting so much taxpayers money on foreign aid (apparently most of that goes into bureacracy costs or gets grabbed by people on the take), the civil service, able-bodied unemployed layabouts/Eastern European single mothers etc, and to really show we mean business we're going to sack the entire MPC and get in some impartial real economic experts instead of more of our mates, who have done more than enough damage already.
I've worked for several private foreign companies where they give you 6-monthly performance reviews and you get hauled over the coals with your job on the line if they think you might be doing any aspect of it slightly suboptimally. It's nothing like government cloud cuckoo land. Almost everyone I know in the UK works for the govt to some degree and most of them seem to get away with doing pretty much what they like (although I am sure there are some tough jobs).
PS Al, I am pissed off hearing you and GB bleat about helping families as if they were all that mattered. Like millions of other voters I'm not a family but living happily alone and it's really expensive to run a house for one person but the only tax break you get is a 25% rates discount. I may not be a pensioner yet but I've noticed how they get the two-finger treatment.
14. Eternal Sceptic said...
If those comments were released after the nu-labour positive spin had embellished them, the great depression may seem quite tame compared to what lies ahead.
15. titaniccaptain said...
Naughty naughty Darling...............foul mouthed rhetoric coming from the government sounded decidedly uncompfortable... call me old fasioned but what kind of message did that send to kids who already have no respect for anything........I feel like im turning into Mary Whitehouse
16. Lierbag said...
I don't have the advantage of briefings from the CBI, parliamentary private secretaries, the office of the government chief scientist or fellow attendees of Bilderberg, yet (like many of the contributors here) have been well aware there was a sub-prime/credit crunch driven house price crash on the way, at least two years ago - and of the problems of peak oil/gas production since about 2004. Our politicians are liars, badly ill-advised, or wilfully incompetent - take your pick.
17. Madashell said...
What's his motivation for doing this? Is there about to be a major revelation which will expose more problems? Is he being reshuffled (sacked) and wants to get his revenge in first? I know he's right and the sooner we wake up a see the danger the better. Perhaps he's having an attack of honesty. My fears are high inflation and low interest rates, high unemployment, big welfare bills. One of the few resources left for the government to plunder is the savings of the responsible people. Are the responsible people about to get shafted?
18. nooneo said...
I personally think they are now talking UP the recession in a bid to fool the electorate when in efect it turns out not to be so bad.
"Look we've prevented the worst economic downturn in 60 years"
This government are in the business of deceipt and bullsh!t. As pointed out first by 'str 2007' the stamp duty non-announcement has effectively killed the property market stone dead and now "Economy at 60-year low, says Darling. And it will get worse" is just more BS. They are attempting to manipulate the british public by crashing the property market even faster than it would have done under 'normal' conditions in an attempt to show some recovery by the next Genereal election in May 2010.
Now the scurilous bunch of ner-do-wells are attempting to deceive us into thinking we are facing another depression (we almmost certainly ain't) so they, and they alone, can save use from the horrors we face.
Where's Guy Fawkes when you need him !!!
19. Dead Money said...
Totally sgree with you TC, politicians using 4 lettered words in public is a very slippery slope indeed. Last one out turn the ligths of please!
20. waitingfor hpc said...
nooneo i like your confidence - i am not so sure that this will not be a depression. or at least a 10 year japanese style recession.
21. denzil said...
I'm with nooneo and enuii and that this is "doom talk" that they can then counter with "oh look we've managed to contain the worse downturn in 60 years, please vote for us". I'm amazed at how cynical I've become of Nu Labour, with good reason though, I believe.
In the other hand Darling's comments are a pretty damning indictment of his boss, aka the invisible man or useless Gordon to others.
22. denzil said...
And another thing. Darling's comments will make people think twice during the approaching wage negotiation round.
God, I'm so sick of this Government!
23. icarus said...
Countries with sound fundamentals, such as the UK, are being hit by imported inflation and a credit crunch that developed elsewhere. These two aliens must have come from Mars.
24. nooneo said...
Remember chaps, almost EVERYTHING this government says is a LIE. So when the chancellor says "Economy at 60-year low, And it will get worse" there are two scenarios
1. They are not telling us the truth and it is actually WORSE.
2. They are not telling us the truth and things are not as bad as being painted.
I fail to see how we can be in a worse situation than the last depression. They are LYING. You know that because their LIPS are MOVING.
This government is fast becoming even more ridiculous than the tories when they attempted to bring in the POLL TAX. So I'd like to propose a change to the headline above:
Government at 60-year low, says Darling. And it will get worse
25. deepak said...
Can I move the converstion on.
How many, what percentage of population within the UK will not be able to survive the current downturn? (Max 60 million)
And the percentage that fall off the financial cliff, will that be big enough for a House Price Crash?
And if yes to what level 30% - 40% - 50% or more
26. titaniccaptain said...
Very good question Deepak..........I have no answers..........anyone know the answer to this one?
27. sold 2 rent 1 said...
Summer 2011 for the end of money.
Global enlightenment 3 years 2 months away - 28 Oct 2011.
28. nooneo said...
deepak @ 16..
I suggest that despite a huge upsurge in repossessions and bankruptcies EVERYONE will survive. They will, by and large, not go to bed hungry, not be homeless and will be able to find employment (if they want to).
I also suggest that regardless of how many fall of the cliff the House Price Crash has started and nothing can now prevent it as confidence in the market has now disappeared. The only people buying are those with money (rather than debt) or the completely foolish.
I can't believe anyone can't see this is now a House Price Crash already. If you are lucky enough to sell your house that's because their are plenty of fools out there. I remember the last crash and people buying into it and buying into a falling market. They thought they were getting bargains and all they did was misread the market and bought themselevs into large amounts of negative equity. There shouldn't be a debate about whether this is a HPC as nothing now can stop it. Don't get wrapped up in percentages, the bubble has burst and nothing, especially this guv'mint, can stop it.
29. nooneo said...
sold 2 rent 1 @ 18
Glad to see you back S2R1. Was getting a bit worried about you. Thought you might have dissapeared into your hideaway in the hills.
30. sold 2 rent 1 said...
nooneo,
The wife gave birth to our baby girl this week.
Have had to put global consciousness on the back burner
31. nooneo said...
Wow. Congratulations S2R1. Excellent news. We need some good news here. I hope that both are well and everything is Ok.
Again CONGRATULATIONS from all on HPC.
32. daft boy said...
nooneo......I am 62 years of age. 59 years ago I went to bed hungry every night. We had been homeless for three years and my father who had been a paratrooper for ten years was unemployed for two years following his discharge. You do not have a clue what you are talking about. What I went through is nothing to what this country is about to go through. We will be a third world country within the next ten years so please adjust your thinking.
33. malct said...
for some reason plato's reference to 'fools paradise' @ 9:11am reminds me of Adam Curtis' Century of Self series (less than perfect) eg ' Happiness Machines', 'The Engineering of Consent' etc how about -
To many in both politics and business, the triumph of the self is the ultimate expression of democracy, where power has finally moved to the people. Certainly the people may feel they are in charge, but are they really? The Century of the Self tells the untold and sometimes controversial story of the growth of the mass-consumer society in Britain and the United States. How was the all-consuming self created, by whom, and in whose interests?
check out the episode guides texts if you don't have time for the films
http://www.bbc.co.uk/bbcfour/documentaries/features/century_of_the_self.shtml
Both New Labour, under Tony Blair, and the Democrats, led by Bill Clinton, used the focus group, which had been invented by psychoanalysts, in order to regain power. They set out to mould their policies to people's inner desires and feelings, just as capitalism had learnt to do with products.
Out of this grew a new culture of public relations and marketing in politics, business and journalism.
forget party politics think wealth extraction/transfer, (yours, ours) what else is offered as an alternative to repossession? rent what was your own home and sell part of it to the council to pay your err ehm 'debts! ???
when they create the debt money out of thin air, they don't create the interest.
This is not JUST a house price crash is it?
34. plato said...
deepak @ 16
Yes to HPC......BUT
Let's see : We've got about 10 million who don't work. About 10 million who go to work but don't work. About 10 million fleecing the system in one way or the other,because its very structure encourages this. About 6 million pensioners. How many children? How many illegals?
So we're talking about 40 million that aren't affected and merely survive anyway whatever the circumstances.(Surely that can't be right!)
This is all guesswork but more accurate than official figures -- Trust me.
Incomes recorded. Incomes unrecorded. Fraud. Inaccurate statistics. Blatant lies.Exponential Debt.
Sorry too messy -- can't work it out,but it's definitely bad.
35. sold 2 rent 1 said...
Cheers nooneo,
Both are doing well.
"We need some good news here"
Surely the dire economic data is good news for HPCers
You are getting what you wished for.
It seems the banking system has taken one more step on the road to total collapse.
That is fantastic news for us who are enslaved into a world of materialism without even realising it.
36. deepak said...
@nooneo - 19-20
Yes I agree that all will survive. But what I ment was will you be indebted with debt the other side or bankrupt?
As higher the percentage the deeper the house price crash.
This is a vicious circle. Repocessions lead to House price falls. And House Price falls lead to Repocessions and the circle goes on.
Like you see now in US the prime mortgages are more in failure.
@ Sold 2 rent 1 - 21
Try to get sleep whenever and whereever you can get. Work/responsibilities will increase and body will start to give up. Maybe I'm potraying my experience.
37. nooneo said...
daft boy @ 23
I suppose the great depression and the second world war weren't factors in your troubles back in 1947 !
All I am suggesting is it's dangerous to talk up possible outcomes when the scenario is completely different. There may well be homelessness and hunger but I suggest to you that the world is not in the grips of war, America is less of an influence than ever, and all we may actually be facing is a recession.
S2R1 - Deepaks right - Get as much kip as humanly possible (assuming this is your first, if not you already now how difficult it's gonna be)
38. Pundit said...
nooneo @ 10,15, 19
This is a blatant attempt by AD to distance himself from GB (and his positive view of the economic outlook) – AD clearly senses GB’s days are numbered, this is political manoeuvring, and he is trying to save his own skin!
Few people in the UK understand or are prepared to admit how serious the current economic situation really is – recession is now definite, a depression is a real possibility.
Will people survive a depression? The majority will, although in very difficult circumstances – there will be casualties. It may seem alarmist, but I can envisage rioting and the army on the streets of major cities in the next 18 months. The nature of the world that we have become used to in the last 60 years is about to undergo a fundamental change.
Whilst I question AD's motives, at least the British public are now being told part of the truth and can begin to prepare for the worst! The HPC will seem like a walk in the park compared to what is around the corner.
39. deepak said...
@plato - 25
6.5 million are claiming benifits (atleast one).
Then you have more pensioners than young people. None pay taxes.
1.6 million claiming job seekers allowance. Even David Blanchflower (the one who always votes for a rate cut) said it will increase to 2 million by then end of the year.
OAP: have been refinancing ( Equity release) their houses to pay for bills. Now that will stop so you will have more getting in the queue.
Rich people: Who have made money and will make money don't pay tax anyway.
Maybe should we talk in terms of households. i.e. when the house looses the income its all the dependents who are affected.
What about the BTLers? 1,000,000 mortgages. How many of those will fail.
Also what about Buy To Sit properties.
Also people who have invested in Spain/ US Florida where prices have fallen by 50% and still can't sell at the low price.
According to me not many need to fail to have a house price crash. Of the 12 million open mortgages only 500,000 or so need to fail to have a crash.
40. denzil said...
Wholehearted congratulations S2R1!
41. Pundit said...
malct @24
You are absolutely right. Through my work I have seen at first hand (right back to Mrs T's first election victory) the use and outcomes of these methods. I imagine a lot of thinking people in this country have a vague awareness of some form of insidious manipulation coming from the 'centre' but have been powerless to act. The lines of control go way beyond the politicos.
42. malct said...
s2r1 "Have had to put global consciousness on the back burner"
not for long mate
"Child is Father to the Man" (Blood, Sweat & Tears album from 1968)
I see quantum leaps in consciousness ahead.
Best Wishes
43. nooneo said...
malct @24
Pundit @ 41
No it's not just a house price crash and yes the lines of control do go way beyond the ploitical environment. The levels of debt that the west currently finds acceptable (and now the emerging economies are buying into) can only lead to one outcome. In my opinion these levels of debt are unsustainable and we are more than likely going to hve to do some radical rethinking over the next century.
Also within this timescale we are going to have to deal with 2 other dangerous scenarios as well. Namely the worlds overpopulation and climate change. If you combine the three, debt, population and climate change the scenario is indeed quite bleak. But not insurmountable. The planet cannot really sustain 10 billion western lifestyles and a radical re-alignment of political thinking will undoubtedly happen.
44. denzil said...
Pundit said:
"The lines of control go way beyond the politicos."
Can you elaborate please?
45. malct said...
denzil, pundit - for me the lines of control lead directly to the banks and debt money creation, with particular relevence to this site being money supply via peoples' homes. Over 97% of money in circulation is debt. Most of it carried and paid for by 'we the people' one way or another.
46. little professor said...
BBC: Darling defends his warning on the economy
The chancellor is standing by his assertion that the UK is facing its worst economic crisis in 60 years.
Alistair Darling told the Guardian newspaper that the downturn would be more "profound and long-lasting" than most people had feared. Shadow chancellor George Osborne said Mr Darling had "let the cat out of the bag" about the state of the economy.
But Mr Darling told the BBC it was important to explain the "unique" problems faced by the global economy.
He said that voters were "pissed off" with Labour's handling of the economy, a key issue at the next election, and said it was "absolutely imperative" that ministers communicated their intentions better.
"This coming 12 months will be the most difficult 12 months the Labour Party has had in a generation, quite frankly."
When asked why he had been so frank, the chancellor told BBC News: "It's important I tell people in this country that we, along with every other country in the world, face a unique set of circumstances where you've got the credit crunch coming at the same time with high oil and food prices."
47. nooneo said...
little professor @ 46
I suggest that voters are (really) "pissed off" with the labour party because they have:
1. Taxed and stealth taxed us to the hilt.
2. Lied us into illegal wars with sovereign states with no moral justification (45 minutes my @rse - Remember it was Tony Bliar that stood up in Parliament and TOLD us that Saddam could gas us within a hour !!!)
3. Presided over the biggest BOOM & BUSt this country has ever faced.
4. Elected Gordon Broon without asking us.
5. Spent every penny in collected taxation and that we had saved (budget surpluss to budget deficit)
6. Are now telling us that we are now "face a unique set of circumstances where you've got the credit crunch coming at the same time with high oil and food prices"
Fook me. I see a pattern emerging - What Alistar Darling (yes remember that's his REAL name - you couldn't make this crap up) is really saying is:
"Look chaps we've absolutely stuffed the economy up and we need to blame outside influences because we'll be fookin lynched if the population realise that they (the public) may be in the sh!te and have to pay for their tiny flats/houses/apartments for the next 20-25 years and not be able to move/go on holidays or basically enjoy themselves until they actually finish paying for all the stuff they couldn't really afford in the first place, before they themselves can dig themselves out of the mucky stuff by actually paying off their debts instead of relying on ever expanding property prices to by their 4x4s, holidays, childrens educations, holiday homes..."
48. nooneo said...
Oh and with regards to my point 4 above. Remember Tony Bliar told us he would serve a FULL term before the last election.
As always, How can you tell if a politician is lying - Their lips are moving.
Don't vote for them, it only encourages them !"!!
49. John88 said...
I feel that there is something we do not know. As its from the chancellor, I feel he is trying to increase the speed of the crash in the hope that the trend will be on the up by the time of the election. This is very worrying, but typical politics - it seems he realises what needs to be done to stay in power.
The economy - we have been moving into a service based economy for over 10 years, service economies are great, until there is a recession, as these businesses simply close, loose their workforce and the owners take a break before starting back up when the economy is recovering - simple business model.
Pretty soon all the fraud etc will start coming out the woodwork as the banks actually look at the securities that were the basis of their lending - the business cycle never changes.....
50. malct said...
nooneo - if, and it's a very very big if, people were able to pay off their debts, the money supply would shrink even more and the world would stop going around.
I think it's impossible.
51. afrobaggie said...
Congratulations S2R1, I will be joining you in the realms of new fatherhood in the next month or so (all being well).
52. jack c said...
@daft boy (currently @ 32) - very wise words (IMO) lets hope viewers treat them seriously
@S2R1 - congratulations on your new arrival.
53. nooneo said...
malct @ 49
For once I agree malct - But unpaid debts arent (neccassarily) going to lead us into the abyss. And money supply shrinking isnt all bad. Like population shrinking and economies getting smaller I think all are possible and may even be a necessity. The present capitilist thinking of ever expanding economies is a purile attempt by the rich to make the poor work harder "Work yourself out of poverty little people"
Look's like S2R1 and Affrobaggie are hopefully going to educate their offspring into not letting the b@stards grind ya down.
Congratulations again Sold 2 Rent 1 (awwww he's probably catching 40 winks right now - Oooops sorry, 47 winks, forgot to add VAT to those winks - silly me) on the birth of your little girl. Give the missus a big kiss from all of us as she undoubtedly has had the hardest task (pregnancy and birth) and now faces the prospect of bringing up a baby with s2r1 (only kidding s2r1) - Hope all 3 of you are going to have a happy (and very concious - believe me you'll want to be more unconcoius soon) time!
54. malct said...
denzil, more specifically, here's a brief quote from
"The Doors of Perception and the Language of Spin "
Tim O'Shea
These early mass persuaders postured themselves as performing a moral service for humanity in general - democracy was too good for people; they needed to be told what to think, because they were incapable of rational thought by themselves.
Here's a paragraph from Bernays' Propaganda:
“Those who manipulate the unseen mechanism of society constitute an invisible government which is the true ruling power of our country. We are governed, our minds molded, our tastes formed, our ideas suggested largely by men we have never heard of. This is a logical result of the way in which our democratic society is organized. Vast numbers of human beings must cooperate in this manner if they are to live together as a smoothly functioning society. In almost every act of our lives whether in the sphere of politics or business in our social conduct or our ethical thinking, we are dominated by the relatively small number of persons who understand the mental processes and social patterns of the masses. It is they who pull the wires that control the public mind.”
A tad different from Thomas Jefferson's view on the subject:
“I know of no safe depository of the ultimate power of the society but the people themselves; and if we think them not enlightened enough to exercise that control with a wholesome discretion, the remedy is not take it from them, but to inform their discretion.”
HERE COMES THE MONEY
Once the possibilities of applying Freudian psychology to mass media were glimpsed, Bernays soon had more corporate clients than he could handle. Global corporations fell all over themselves courting the new Image Makers.
55. malct said...
daft boy - good to have you around. All this talk of babies is making me feel very old. My next one will be my fifth grandchild!
I can reflect on how things have changed in my lifetime, and I wonder how some will cope with the hardships ahead.
56. Bananasplit said...
When the truth is told you know that it is a serious long term problem that won't go away with a new headline.
57. beartil2010 said...
Is this the all time biggest comments thread on HPC?
Congratulations S2R1!
Honestly, it's impossible trying to second guess this government. All we know is that they are definitely stupid, and definitely liars. They may also be well informed, devious and intelligent, but you can't be sure.
I think Darling is trying to make it look worse than it is - so they can say they're recovering - but oh dear, it actually is going to be that bad and they don't realise it!
I have no debts, quite a bit of savings and am going on holiday soon for a couple of months. Wonder what it'll be like when I come back!
58. renting2 said...
Congrats S2R1!
59. Pundit said...
denzil @44
malct @53 goes someway to providing an answer in terms of how the process works. As to who the individuals or organisations might be that exercise control is a question I cannot answer - by it's very nature, for the system to operate successfully it must be invisible.
Consider how many politicians, on retiring from politics, are rewarded with large salaries and a place on the board of financial organisations or work for arms manuafacturers etc. How many senior politicians in the US for example are connected with the arms and oil industries? Who benefits from the situation in Iraq? At a mundane level we know stock markets can be 'manipulated' by insider trading etc - it's not a great leap of imagination to think that the Worlds financial systems could be 'manipulated' in a similar way.
I gave up on economic theory many years ago - many of the models work well - up to a point, then there is some unexplained outside intervention. What I mean by this is that we have enough understanding of macro economics to ensure there are no disasters - but why do the disasters still occur? Who benefits from economic disaster?
The current economic meltdown may not be a random event. nooneo @43 makes an excellent point "If you combine the three, debt, population and climate change the scenario is indeed quite bleak. But not insurmountable. The planet cannot really sustain 10 billion western lifestyles and a radical re-alignment of political thinking will undoubtedly happen."
Someone, somewhere has realised their existence is under threat from over population and climate change and they have started to pull the levers of control!!! Debt, financial turmoil, economic crash etc are just the means to bring about a change that will sustain their existance. An economic monster that was created (by the invisible government) in the immediate post-war period and has created huge wealth for a small number of (invisible) individuals has gone out of control - it's now being reined in.
60. alan said...
Well Done S2R1,
Moving on from the article today, I wonder what the next step can be for the Nu Labour cabinet?
I think The Badger wants to move forward and demonstrate that Labour are electable again. Whether the party has the will or leadership to get stuck in is debatable. I see a gradual dwindling of support as inflation rises and the pound drops.
I've also spotted that key companies are laying off staff. Unilever, Halifax etc over the past week. I think a change of mood could happen quite quickly in the UK, as 0% interest dries up for cards and energy bills go up once again.
61. malct said...
55. beartil2010 said...
Is this the all time biggest comments thread on HPC?
no where near it just yet beartil2010.
sadly it's probably because most are agreeing with each other or at least being politely engaging.
In that sense it may already be a record!
re going on holiday and coming back! - are you sure?
62. malct said...
just caught bbc news
labour's answer - a cabinet reshuffle
honest
63. malct said...
omg it gets worse - the bbc AD interview!!!
he keeps mentioning the rescue of northen rock as part of the solution
64. Yerhavingalaugh said...
Sadly one of the consequences of the coming disaster will be an increase in the suicide rate as ruthless creditors put the pressure on. Sorry nooneo, not everyone will survive this.
65. beartil2010 said...
actually yes I may not be coming back for a few years - I have a permanent resident visa for Australia! Very long working holiday ahead methinks...
66. enuii said...
How is the government going to bankroll it's huge wage bill for people directly and indirectly employed by the state, gaw'd knows what the percentage is but it must be huge.
Secondly for every pound that disappears out of everyones pocket through inflation, falling sterling and increased taxation, (£1 off everyone = £60M/year) how many jobs in the service sector are lost as I roughly estimate 1200.
The government is backed into a corner on this one and there is no way out until events have been allowed to run their course.
67. mark wadsworth said...
Enuii, gummint waste, i.e. 'jobs for the boys' is about 15% - 20% of gummint spending, i.e. if we sacked the additional 2 million extra public sector workers taken on since 1997, this would mean we could cut taxes by about £100 billion per annum, or £3,000 per taxpayer.
68. enuii said...
Mark, any ideas on my second point, if most folk are feeling skint now how many jobs per pound per annum will be lost as their ability to spend falls?
69. little professor said...
55. beartil2010 said...
Is this the all time biggest comments thread on HPC?
Not quite; although all the previous mega-threads have been people falling for trolling from the likes of greenbay.
70. malct said...
little professor - and to be fair some people having a pop at s2r1 and p4ac
71. Enoughalready said...
Can we sue the Gov for malpractice?
72. quiet guy said...
"Is this the all time biggest comments thread on HPC?"
Sorry to sound like a curmudgeon but the reason that this post has attracted so many comments is that the blog accepted that it was posted at 23:33 30th August (by my watch it is only 20:00 20th August right now) hence it has been promoted as the most recent post all day.
P.S. Congrats and good to see you back S2R1, even if we disagree on almost everythng.
73. quiet guy said...
Oops. Typo.
by my watch it is only 20:12 30th August right now.
74. uncle tom said...
Why does a story like this have to break when I'm 250 miles away from my computer...??
...not that I can add much to what has already been said..
I think Darling was motivated by a cocktail of factors
- the need to borrow a vast amount of cash that will reduce the 'fiscal rules' to a laughing stock
- the realisation that pretending everything is rosy ain't going to work, and that it's probably better to get the bad news said and out of the way
- the realisation that in order to save his own skin, Brown was probably ready to sack him and then try to blame him for screwing things up
This is probably the smartest thing he's done since arriving at No. 11 - but that ain't saying much...!
75. voiceofreason said...
1. Congrats S2R1 ! Remember it gets better all the time from now on in :)
Agree with UT, Darling has figured out that the banks etc cannot dig themselves out of this one without huge overspill into the wider economy.
Also, the UK is more over exposed than even the USA (due to their no recourse mortgages), and the UK's reliance on finance and building.
Add to this the huge squeeze on private sector wages and employment we see from law, accountancy, insurance, IT jobs going offshore.
But remember, out of 26million homes in the UK, 11 million have no mortgage, and I think most of the rest have manageable mortgages, it is only those who have moved or BTLed or MEWed in the last 3 or 4 years who are in real trouble.
76. sold 2 rent 1 said...
Cheers for the support guys.
It is our second BTW
77. titaniccaptain said...
S2R1
CONGRATS!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!! im chuffed for you bro
78. plato said...
sold 2 rent 1
Before I retire and lose consciousness for tonight: Congratulations to you and your wife.
79. mytimeisnigh said...
I'm not so sure why Al Darl has said this and I'm not too sure that you guys do either. Other than this is a down turn and if it means 40% off house prices I'm pleasesd. :-)
80. titaniccaptain said...
@my time is nigh..............
40%!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!! and the rest.................
81. mytimeisnigh said...
Sorry 70% !!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!! Wahey!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
82. nooneo said...
I personally think Darling knows the game is up. He is personally trying to distance him from our dodgy PM as he already knows he is getting the chop forthwith. I think he has gone off-plan and no longer wants to sing from Gordy's himsheet as he knows that he will be made a scapegoat within weeks. He is positioning himself for when he has returned to the back benches and can gloat at how Gordon and his morons (minions) have cocked up the economy.
It's going to be an interesting few weeks/months as it definetely appears that the amount of agnst that Gordon Broon generates is in direct relationship with the amount he is on the telly. Nothing can save him know, absolutely nothing!
83. alan said...
"I'm not so sure why Al Darl has said this....." Well, one of the first things Vince said, when interviewed on Sky was "what is he intending to do about it"?
The Badger needs something to make people take notice - he can't just reallocate £30m of the Housing Repairs budget to the House Purchasing budget. He can't come up with new money - he is already in trouble for overspending.
I think that Nu Lab has to pull something out of the bag and it has to get people's attention. There is an outside chance that Nu Lab will put pressure on the MPC to cut rates and "be seen to be doing something".
IMHO, next week will be revealing because it will set the tone for the next stage of NuLabour's implosion.
84. mytimeisnigh said...
Well, take it from someone that works at Social Services, there is no more money left to waste.
85. mytimeisnigh said...
Well, take it from someone that works at Social Services, there is no more money left to waste.
86. gardeniadotnet said...
sold 2 rent 1
Congratulations.
Best wishes for the future to you and your family.
87. Mjchum said...
Who cares . . . .
88. enuii said...
There is no money left anywhere for anyone to waste anymore, the last 10 years have been directly and indirectly on borrowed money!
89. Buing Noe said...
The comments on this thread remind me of 'gold bugs' aka 'rednecks buying gold cos this fiat currency thang has no hope - just give me a rifle and my shack in the country'. Interesting thing is these guys have been spouting their bile for a lot longer than UK house prices have been on the upward trajectory. Let's be clear here - inflation is a good thing if you have a mortgage - fact (so messing around with money supply suits me fine). At the moment sterling is plummeting and about time too, this will help the allocation of resources and encourage productive investment (which I imagine will be services based which is our strength, long live London - a bit of pain now, bit of gain later). Also, in case anyone missed it, this is a global economy let's try not to compare today to 60 years ago, only a fool would do so. Your affectionate 'AD' is royal Charlie on that I don't dissagree.
Lastly, this is the truth there is no a band of brothers getting together to try and keep the working man down - he does that himself via panic and stupidity.
90. Brownout said...
QUOTE:- "Brown and the cabinet are partly to blame for Labour's woes because they have "patently" failed to explain the party's central mission to the country"
He still doesn’t geddit … They have explained their mission … and NO BODY WANTS IT !
Most people are fed up to the back teeth, and bled dry though tax of this governments tax and spend policies.
The explosions in civil servant jobs (+1.7million in past 10 yrs) seemS mostly needed to enforce all the new nanny state laws and bureaucracy (33,000 laws I read somewhere) and gather fines from wrong doers and therefore prop up the government coffers. This has also, off course, helped reduce the superficial headline un-employment figures for political purposes, whilst also neatly ensuring up to 1.7million labour voters at election time … who won't vote for anyone else as they’ll be voting themselves out of a job….
… and the whole 'elf n safety' non-job culture is a farce, and then there's minor things like bin-tax, and scaremongering environmental excuses for taxing everything in between.
God only help who ever comes in behind the current shower, for they will have a very unpleasant amount of savage economic surgery to perform before the sick man of Europe is able to walk again.
… trouble is, I see credible strong leader types in either opposition party, which gives me gloomy visions of revolution in our streets, ten times worse than what I experienced in the late 70's.
Nice ehh ?
91. Pundit said...
Denzil @44 asked for elaboration on
“The lines of control go way beyond the politicos."
Unfortunately, due to other commitments yesterday I was only able to provide a brief response and given the nature of the topic it’s almost impossible give specifics – particularly in public forum. For my part, I spent many years working in advertising and marketing, and have first-hand experience of the methods used to lead peoples thinking in a particular direction. Persuading the electorate to vote for a certain political party is not very different from leading consumers to buy a particular brand of washing powder.
It is well documented that the media, especially the tabloid press are able to lead people’s political thinking. This prompts the question as to whether the press or politicians are more powerful – who infuences the media? Consider how the same story might be reported by the Socialist Worker and The D Telegraph – different VI’s.
An example, which is in the public domain, of how an individual may exert greater influence than a national government is shown by the events leading to ‘Black Wednesday’ and Sterling crashing from the ERM. I’m not suggesting in any way that George Soros is part of any ‘invisible government’, indeed he has talked openly and always emphasised that he acted alone. However, this example demonstrates the possibility that a number of very wealthy individuals working together could perhaps manipulate the Worlds financial markets for their own gain.
92. Tweddle Dum said...
I was a kid in 1948 we had rationing the goverment (labour as usual) was demanding that every thing made was to be exported.My Dad was trying to run a sheet metal company It was hard to get sheet steel, aluminium was almost imposible exept for stuff called alclad which was left over from aircraft production.and was limited in its use.Nationalisation was the rage by that labour party.We had just had a Mother and Father of a winter the nation was on the edge of starvation. If this is the state this lot have gotten us into then Heaven help us.If the pound is useless as it was then,who will sell us food where is the industry to export to pay our way, we had that then.I cant believe it can be this bad WW2 nearly destoyed this country, was Blair and Brown as bad as WW2. Only last year I was saying to my son this isnt a affluent society the way people are today this is oppulence.At least this generation has seen great times,getting something to wear was a celebration in 1948.