interestrateripoff Posted August 23, 2009 Share Posted August 23, 2009 These are all just signs of recovery.Remember: Debt is wealth, so a a lower tax take is in fact a positive. Not quite what it means is that Brown needs to borrow even more money to stimulate the economy and increase tax revenue and growth. Clearly not enough money has been borrowed to stimulate tax revenues. Quote Link to comment Share on other sites More sharing options...
the wizard Posted August 23, 2009 Share Posted August 23, 2009 The market still has a strong appetite for Treasuries. And they are the experts. How much did the same experts value pets.com? Northern Rock? Enron? The efficient market hypothesis does not mean that prices reflect reality. Quote Link to comment Share on other sites More sharing options...
the_austrian Posted August 23, 2009 Share Posted August 23, 2009 How much did the same experts value pets.com? Northern Rock? Enron?The efficient market hypothesis does not mean that prices reflect reality. EMH claims that the price reflects known information. What information is missing from the bond markets that, once available to all, will cause them to crash? Surely they don't expect the Government to monetise all the debt and it can't come from taxpayers so what are they thinking? Quote Link to comment Share on other sites More sharing options...
interestrateripoff Posted August 23, 2009 Share Posted August 23, 2009 How much did the same experts value pets.com? Northern Rock? Enron?The efficient market hypothesis does not mean that prices reflect reality. Reality always seems to get in the way. Has anyone got a chart yet to show what's happened to UK tax revenues? How does this compare to previous recessions? Quote Link to comment Share on other sites More sharing options...
the wizard Posted August 23, 2009 Share Posted August 23, 2009 (edited) EMH claims that the price reflects known information. What information is missing from the bond markets that, once available to all, will cause them to crash? Surely they don't expect the Government to monetise all the debt and it can't come from taxpayers so what are they thinking? Not quite. I think that the EMH says it is impossible to reliably make a profit from currently available information, a much tougher requirement, which I believe still allows for bubbles (especially when you add in government bail-outs for failed gamblers). However, I am not an expert. Anyway, I have no idea what the market is thinking, I'm just pointing out that claims of expertise for anyone working in economics or finance, or indeed for the market itself, should be taken with a pinch of salt. Edited August 23, 2009 by the wizard Quote Link to comment Share on other sites More sharing options...
the primitive Posted August 23, 2009 Share Posted August 23, 2009 I am an utter idiot, and this comes as no surprise. I've noticed a lot of other idiots who will not be surprised either.Therefore, one can only conclude that either this is a random event where the idiots were proved right by chance, or that the experts are lying. I suppose we should look to see whether this "surprise" can be dismissed as an outlier, or whether the predictions of the idiots are actually within the reported data. Do we have a liar smiley? +1 good post When the government is spending £4 for every £3 it raises in tax, any fool can see it is not all rosy in the garden. And I am not sticking my neck out too far I don't think, when I say that this recovery is not all based on sound fundamentals. Quote Link to comment Share on other sites More sharing options...
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