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We Now Face A Crisis That Is The Economic Equivalent Of War

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http://www.telegraph.co.uk/news/politics/liberaldemocrats/8768046/Liberal-Democrats-Party-Conference-2011-live.html

He starts on the crisis. A dire warning: "We now face a crisis that is the economic equivalent of war," he says.

"The financial crisis is still with us. We can see that recovery has stalled in the US and the position in the Eurozone is dire."

"Many of our problems are home-grown. Gordon Brown regularly advised the rest of the world to follow his British model of growth. But the model was flawed."

He says: "I regret this year is that we did not secure tighter control on bank pay and bonuses."

He hails the new Jaguar Land Rover plant to be opened in Britain, saying: "That’s what I mean by a business recovery, cars not casinos."

On the cuts, he says they were left with a "dangerous, unsustainable budget deficit, and says: "Cutting it is a thankless and unpopular task, but unavoidable if our country and party are to be taken seriously."

"Financial discipline is not ideological; it is a necessary precondition for effective government... the progressive agenda of centre left parties cannot be delivered by bankrupt Governments."

He says others - Tories? - treat government like Father Christmas, dropping economic presents down the chimney if they hand out tax cuts. He says thinking tax cuts will draw back non-dom billionaires is a "childish fantasy."

On banks, he calls for Vickers to be implemented. "At present, banks are offered a one way bet. If they gamble and win; they fill up the bonus pool. But when they lose, the taxpayer pays."

"Rogue" banks are "exposing taxpayers to the risk of exploding financial weapons of mass destruction," he says.

In a bizarre analogy using trousers, he says there has been "feast or famine" in bank lending - he calls for steady lending growth to small businesses.

Full Speech

Not mincing his words.

Although he needed to add on with the bankers the taxpayer fills up the bonus pools again even when the bets fail.

You get the impression something major is about to happen.

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http://www.telegraph...-2011-live.html

Full Speech

Not mincing his words.

Although he needed to add on with the bankers the taxpayer fills up the bonus pools again even when the bets fail.

You get the impression something major is about to happen.

Here he got his pants into a self handled "wedgie" (note the relation to 'Golf' yet again)

"What I want to do is to strengthen the best of British business.

I have taken two initiatives in particular:

• I have asked Professor John Kay, together with Sir John Rose, formerly CEO of Rolls Royce – whose company embodies responsible capitalism in its commitment to long term investment in training and R&D – to look at how we get stock markets and institutional investors out of their short term, speculative mindset.

• I am separately consulting on how best to tackle the escalation of executive pay which, in many cases, has lost any connection with the value of shares, let alone average employee pay.

Ahem >>> http://www.insiderme...ility-overseas/

8th Aug 2011

"Rolls-Royce is conducting a feasibility study into the possibility of building a new engine testing facility in Germany or the US rather than the UK, the Observer reported."

Edited by erranta

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"He starts on the crisis. A dire warning: "We now face a crisis that is the economic equivalent of war," he says."

I think this is incorrect...it should read:

We now face a crisis that is the economic equivalent of pre-cursor to war.

You can kind of see it coming. The economic collapse + diminishing supplied of oil could spell disaster for many.

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One of the greatest blog snippets of all time.

Many have been there - done it

snippet of zillions of other quotes

---------------------------------------------------------------------------------------------------------------------------------------------------------------------

Just as we outgrow a pair of trousers, we outgrow acquaintances, libraries, principles, etc., at times before they're worn out and times - and this is the worst of all - before we have new ones.

Georg C. Lichtenberg

One should never put on one's best trousers to go out to battle for freedom and truth.

Henrik Ibsen

Practical prayer is harder on the soles of your shoes than on the knees of your trousers.

Austin O'Malley

Rock music should be gross: that's the fun of it. It gets up and drops its trousers.

Bruce Dickinson

Were it not for the Clash, punk would have been just a sneer, a safety pin and a pair of bondage trousers.

Billy Bragg

-----------------------------------------------------------------------------------------------------------------------------------------------------------------

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Feel free to take him seriously, I don't

He's a professional liar (a.k.a politician) who works for the banks and the other corporations that rule us.

He's function is to destract you, and on ocassions like this, to offer false hope that somebody in charge knows what the problems are, and how they will be fixed..

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Feel free to take him seriously, I don't

He's a professional liar (a.k.a politician) who works for the banks and the other corporations that rule us.

He's function is to destract you, and on ocassions like this, to offer false hope that somebody in charge knows what the problems are, and how they will be fixed..

Exactly. Talk is cheap, and I see no action.

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Vince has gone at the game. He thinks QE is the answer to all our problems. To increase consumer demand, the same thing he said was unsustainable in 2007

While house prices are so high there is less money to lend to business. The tax system encourages BTL not business creation that creates more jobs.

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He's function is to destract you, and on ocassions like this, to offer false hope that somebody in charge knows what the problems are, and how they will be fixed..

Indeed; to use a famous war analogy we're "lions led by donkeys".

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Vince says: "I regret this year that we did not secure tighter control on bank pay and bonuses."

Balls.

He's a professional liar (a.k.a politician) who works for the banks and the other corporations that rule us.

Exactly. Talk is cheap, and I see no action.

Windbag exhales

Agreed

Edited by Milton

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Soon enough, the words from their flapping lips will fall on deaf ears... the bellow from the markets will be overwhelming. It's about time too!

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Whats up with John Rose?

Maybe the Vince should be using Rose to find out from Rolls what is missing in the UK that makes them look abroad taking the skills and jobs with it let alone future treasury taxable revenues

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Vince has gone at the game. He thinks QE is the answer to all our problems. To increase consumer demand, the same thing he said was unsustainable in 2007

While house prices are so high there is less money to lend to business. The tax system encourages BTL not business creation that creates more jobs.

Correct.....Vince knows the truth, there is no one good solution to the ginormous problems we are facing, QE is only a sort-term stop gap that can only prolong the pain.......the fact of the matter is that there is too much debt in the western economy, much of it will never be repaid at the price it was borrowed at....all unpaid debt has to be paid for either through defacement of savings/inflation or high unemployment or as it is looking more like both...such a large amount of debt has only created short-term wealth...high continual growth with such high debt is unsustainable.......there is light at the end of the tunnel on the other side of the globe. ;)

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Vince has gone at the game. He thinks QE is the answer to all our problems. To increase consumer demand, the same thing he said was unsustainable in 2007

Yes - I noticed that. I've learned to listen to Vince Cable - as I've found he often has relevant insightful things to say... perhaps not at the absolute cutting edge, but well ahead of the mainstream media and most MPs.

I don't see why he'd say QE is the answer - when, to me, it clearly isn't an answer at all... and I'd previously suspected Vince would be one of the few people in the public eye who'd agree with me.

As I see it, there are three possibilities. Vince Cable might be getting behind QE for some ulterior motive; he might be genuinely confused and think it's appropriate for some reason; I might have overlooked something that makes further QE the least bad among very bad options. I assumed that QE1 was about plugging the gap when European investment in Sterling money markets was suddenly withdrawn... leaving a short-term funding gap for leveraged portfolios of (mortgage) debts. If that explains the last QE, is there a similar issue today?

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Yes - I noticed that. I've learned to listen to Vince Cable - as I've found he often has relevant insightful things to say... perhaps not at the absolute cutting edge, but well ahead of the mainstream media and most MPs.

I don't see why he'd say QE is the answer - when, to me, it clearly isn't an answer at all... and I'd previously suspected Vince would be one of the few people in the public eye who'd agree with me.

As I see it, there are three possibilities. Vince Cable might be getting behind QE for some ulterior motive; he might be genuinely confused and think it's appropriate for some reason; I might have overlooked something that makes further QE the least bad among very bad options. I assumed that QE1 was about plugging the gap when European investment in Sterling money markets was suddenly withdrawn... leaving a short-term funding gap for leveraged portfolios of (mortgage) debts. If that explains the last QE, is there a similar issue today?

It depends - if the alternative to QE is the complete breakdown of western civilization, which would you choose...?

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I assumed that QE1 was about plugging the gap when European investment in Sterling money markets was suddenly withdrawn... leaving a short-term funding gap for leveraged portfolios of (mortgage) debts. If that explains the last QE, is there a similar issue today?

The point of QE is to raise aggregate demand, which leads to rising prices of assets. Bernanke and the BoE have explained it in simple terms.

I don't think it's a short term project, and the experiment was always going to be repeated.

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Feel free to take him seriously, I don't

He's a professional liar (a.k.a politician) who works for the banks and the other corporations that rule us.

He's function is to destract you, and on ocassions like this, to offer false hope that somebody in charge knows what the problems are, and how they will be fixed..

+1

Everytime a politician opens his mouth the only sane response is to ask why is this b*stard lying to me.

The true motives and aims of policy are never the ones that are put out to garner headlines.

It was they don't say or discuss in their speeches that is usually significant.

Edited by stormymonday_2011

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It depends - if the alternative to QE is the complete breakdown of western civilization, which would you choose...?

Reluctantly, I'd choose QE. I think the decision really was this stark last time - essentially, there were several hundred billion Euros of short-term money-market finance that were withdrawn... on the sudden realisation that no-one was really sure how low-risk these low risk loans really were. The alternative being widespread economic collapse.

Under these circumstances, QE almost makes sense - it's the least bad option... It made sense. Sure, there was a minor improvement in confidence - though that was short-lived... which, again, makes some sort of sense. What doesn't make sense is QE where the intention is to improve confidence... and to grow the economy. It simply doesn't make sense... It makes objective sense (in a Keynesian way) for the government to borrow and spend - accepting that it ushers in inflation... It makes sense to regulate banks harshly - to establish a level playing field. It makes sense for the government to make long term commitments. It doesn't make sense to unnecessarily shuffle paper around at central banks in the hope that, in the confusion, people will suddenly start to feel more optimistic.

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Reluctantly, I'd choose QE. I think the decision really was this stark last time - essentially, there were several hundred billion Euros of short-term money-market finance that were withdrawn... on the sudden realisation that no-one was really sure how low-risk these low risk loans really were. The alternative being widespread economic collapse.

Under these circumstances, QE almost makes sense - it's the least bad option... It made sense. Sure, there was a minor improvement in confidence - though that was short-lived... which, again, makes some sort of sense. What doesn't make sense is QE where the intention is to improve confidence... and to grow the economy. It simply doesn't make sense... It makes objective sense (in a Keynesian way) for the government to borrow and spend - accepting that it ushers in inflation... It makes sense to regulate banks harshly - to establish a level playing field. It makes sense for the government to make long term commitments. It doesn't make sense to unnecessarily shuffle paper around at central banks in the hope that, in the confusion, people will suddenly start to feel more optimistic.

QE always was going to be a can kicking excercise - now it's started, there is only one path they can take - more of the same, until collapse.

Because the alternative is collapse, sooner.

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  • 336 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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