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Bloo Loo

Government Borrowing Up

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Just heard on R2 1PM news.

government borrowing up by 1.4bn...odd as July is the month many firms pay their tax, and last year was a surplus....the reason?...GOVERNMENT DEPARTMENTS ARE SPENDING MORE DUE TO THE RECOVERY.

There is NO AUSTERITY

And just what is this recovery of which they speak?

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Just heard on R2 1PM news.

government borrowing up by 1.4bn...odd as July is the month many firms pay their tax, and last year was a surplus....the reason?...GOVERNMENT DEPARTMENTS ARE SPENDING MORE DUE TO THE RECOVERY.

There is NO AUSTERITY

And just what is this recovery of which they speak?

It's a recovery brought about by more govt spending and taxpayer subsidised mortgage lending. That is to say, it's not a recovery at all but a relapse.

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It's a recovery brought about by more govt spending and taxpayer subsidised mortgage lending. That is to say, it's not a recovery at all but a relapse.

It was a small deficit that will no doubt be upgraded to a surplus. Higher tax receipts are encouraging.

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Just heard on R2 1PM news.

government borrowing up by 1.4bn...odd as July is the month many firms pay their tax, and last year was a surplus....the reason?...GOVERNMENT DEPARTMENTS ARE SPENDING MORE DUE TO THE RECOVERY.

There is NO AUSTERITY

And just what is this recovery of which they speak?

Isnt this what balls-up says?

Well actually he says two things.

One is we shouldnt cut until the recovery is 'locked in'

The other is when the recovery is 'locked in', we wont have to cut.

Balls-up, the only man able to make G-I-D-I-O-T smell slightly less of piss.

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It was a small deficit that will no doubt be upgraded to a surplus. Higher tax receipts are encouraging.

No doubt it's a surplus. With a minus sign.

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No doubt it's a surplus. With a minus sign.

it's an almighty mess that's what it is.

i voted for austerity...i got more spending and my taxes being used to hammer my savings and lend money to people stupid enough to sign their live over to the banking system. something is wrong with the UK government...its like...they are not actually in charge...:lol:

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it's an almighty mess that's what it is.

i voted for austerity...i got more spending and my taxes being used to hammer my savings and lend money to people stupid enough to sign their live over to the banking system. something is wrong with the UK government...its like...they are not actually in charge...:lol:

Austerity does not and will not ever work.

If both consumption and exports are stagnant/falling, then all austerity does is reduce consumption. Or what do you actually expect to happen? Companies increasing investment in the face of significant falls in demand perhaps?

The austerity meme is nonsense. We need internal rebalancing about how income is distributed so consumption can be based on wages and not debt, and we also need rebalancing of exports vs imports, particularly methods that neuter the merchantalist policies of those we trade with (germany, china, and japan are the big three).

Everything else is nonsense.

Edited by alexw

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It's a recovery brought about by more govt spending and taxpayer subsidised mortgage lending. That is to say, it's not a recovery at all but a relapse.

...it's actually a bubble stoked up for the lead-in to the general election ....and like all bubbles it will blow up in your face and there will many losers including all tax payers...... :rolleyes:

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Austerity does not and will not ever work.

If both consumption and exports are stagnant/falling, then all austerity does is reduce consumption.

The austerity meme is nonsense. We need internal rebalancing about how income is distributed so consumption can be based on wages and not debt, and we also need rebalancing of exports vs imports, particularly methods that neuter the merchantalist policies of those we trade with (germany, china, and japan are the big three).

Everything else is nonsense.

only if your measure of success is GDP...every £ spent less in excess of tax take means a drop in GDP...its inevitable...and thecost of borrowing adds to the reduction in value of your tax payments...

SO yes, the pain from the credit binge is something that has to be lived through...but, the ££££s not spent in tax to cover deficits, are spent by those earning them, rather than by the Government deciding who else can spend them.

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No they have to spend more to reach escape velocity, 'locked in', 'on track' 'prudence' and 'green shoots' are the old paradigm. We are spending our way out of recession (which will be revised to show it never existed) so Balls and George are actually in favour of the same approach; deficit still at £120 bn but with more 'growth' this should increase substantially.

Oh, i know the difference with Balls and Osborne is do we want to hit a brick wall at 125mph or 110mph, either proves fatal...Just while Osborne pretends he is of sound mind, Balls revels in his image as unhinged criminal mastermind.

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only if your measure of success is GDP...every £ spent less in excess of tax take means a drop in GDP...its inevitable...and thecost of borrowing adds to the reduction in value of your tax payments...

SO yes, the pain from the credit binge is something that has to be lived through...but, the ££££s not spent in tax to cover deficits, are spent by those earning them, rather than by the Government deciding who else can spend them.

Not true.

The money can be sat on.

Corporate cash piles were ~£750 billion last year, and will be some billions higher still now.

God knows how many hundreds of billions the top 1% are sat on also. That of course won't be moving round the economy either, but rather gambled on various speculative non-wealth producing activities.

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Not true.

The money can be sat on.

Corporate cash piles were ~£750 billion last year, and will be some billions higher still now.

God knows how many hundreds of billions the top 1% are sat on also. That of course won't be moving round the economy either, but rather gambled on various speculative non-wealth producing activities.

IC...so corporate cash just sits in a bank account...and the bank does nothing at all with it...odd then that they claim there is the money multiplier whereby deposits are lent out to borrowers, borrowers who usually buy things with it.

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IC...so corporate cash just sits in a bank account...and the bank does nothing at all with it...odd then that they claim there is the money multiplier whereby deposits are lent out to borrowers, borrowers who usually buy things with it.

You should know by now that deposits are not loaned out.

Next you'll be telling me that you could not withdraw money from your bank account because the bank lent it out....

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You should know by now that deposits are not loaned out.

Next you'll be telling me that you could not withdraw money from your bank account because the bank lent it out....

No, deposits and loans are created at the same time. And the money multiplier's a load of baloney too. But Bloo does have a point. Corporate cash piles have burgeoned since the Crash but corporate debts have grown even faster. It's this refinancing activity, the issuing of more corporate bonds to rollover existing debt as it matures, that's helped the US economy in particular gain what little traction it's had. When interest rates rise these same companies will need to dip into their cash reserves to pay their creditors.

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Austerity does not and will not ever work.

If both consumption and exports are stagnant/falling, then all austerity does is reduce consumption. Or what do you actually expect to happen? Companies increasing investment in the face of significant falls in demand perhaps?

The austerity meme is nonsense. We need internal rebalancing about how income is distributed so consumption can be based on wages and not debt, and we also need rebalancing of exports vs imports, particularly methods that neuter the merchantalist policies of those we trade with (germany, china, and japan are the big three).

Everything else is nonsense.

Sorry to tell you, but there is certainly no rebalancing in wages going on......the few are still being paid more (more than they deserve in many cases, because they can) and not necessarily spending more into this economy and the rest are being paid less in real terms so can't spend more even if they would like to....their money is going towards paying fixed costs, non-discretionary items, no boosting consumption from them....then it is gone, or else all that is left is to clock up debt for them that won't be repaid....you can't extract blood from stones. ;)

Edited by winkie

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You should know by now that deposits are not loaned out.

Next you'll be telling me that you could not withdraw money from your bank account because the bank lent it out....

banks can lend out a percentage of their funds, whether deposited or borrowed,against the capital they hold.

Im not sure what else you think they loan. or maybe you think a bank run cant happen...of course, it couldnt IF they didnt actually "put your money to work". or maybe you think NR had sufficient funds to pay all the depositors queuing up on that fateful Saturday...

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