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Realistbear

Britain's Public Finances Worsen To Record Deficit Level

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http://uk.biz.yahoo.com/20012006/323/brita...icit-level.html

LONDON (AFP) - Britain's public finances deteriorated in December to their worst-ever level, official data showed.

The public sector net cash requirement (PSNCR), the public sector's need to raise cash, showed a deficit of 14.9 billion pounds (21.8 billion euros, 26.2 billion dollars) in December, National Statistics said Friday.

That marked the worst level since records began in 1984 and compared with November's deficit of 9.2 billion pounds.

It was also worse than analysts' consensus forecasts of a 14.3-billion-pound deficit. In December 2004, the shortfall stood at 14.6 billion pounds.

Public sector net borrowing (PSNB), the government's preferred measure of the public sector finances, showed a deficit of 6.5 billion pounds in December, compared with 9.0 billion the previous month, and 6.1 billion in December 2004.

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Accorrding to my mental arithmitic hte Government has run up an overdraft of around £1,000 for every man, woman, child, pensioner, baby etc etc in the country. That spells total mismanagement of the public sector purse. Gordon Brown's miracle economy is nothing but an illusion that will end in tears.

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Accorrding to my mental arithmitic hte Government has run up an overdraft of around £1,000 for every man, woman, child, pensioner, baby etc etc in the country. That spells total mismanagement of the public sector purse. Gordon Brown's miracle economy is nothing but an illusion that will end in tears.

What is this doing today to gilts and long bond prices? anyone?

Effect on interest rates?

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Effect on interest rates?

This is a very handy page for those of us who lose track of what all the various indicators actually mean.

Apparently:

Public sector borrowing requirement (PSBR) (monthly) (4/3)

Central government's budget deficit. A negative deficit, or budget surplus, is known as a public sector debt repayment.

This figure is not particularly important, as the government is not explicitly aiming to meet the Maastricht criteria. Its link with inflation is weak.

Presumably it does mean that the government will look to increase its income (taxation) or reduce spending, though. If I recall, either of these will reduce aggregate demand in the economy, which ought to be deflationary(?).

Edited by Ted D. Bear

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Accorrding to my mental arithmitic hte Government has run up an overdraft of around £1,000 for every man, woman, child, pensioner, baby etc etc in the country.

Per Month :o

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Per Month :o

So add that to the amount of tax and NI I pay every month and the Govt is on nearly the same as my take home pay. And it's still not enough? :angry:

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Guest Riser

What is this doing today to gilts and long bond prices? anyone?

Effect on interest rates?

Heres a clue:

LONDON (AFX) - European government bonds resumed falls in afternoon trade,

having dropped sharply yesterday amid the growing belief that the the European

Central Bank will hike interest rates in the next few months.

Earlier, bond prices appeared to stabilise after the hefty falls suffered

Thursday but the buying momentum faded away quickly.

Yesterday, the hawkish tone struck by the European Central Bank and euro

zone inflation numbers stoked expectations of more rate hikes in the area. The

ECB lifted the benchmark refi rate to 2.25 pct in December last year after

having held the rate unchanged at 2.00 pct since June 2003.

Some analysts expect the ECB to put up rates by two quarter points this

year, taking the refi rate to 2.75 pct.

These expectations had a telling effect on bond prices which fell sharply

across the board but more severely at the shorter end.

Robyn Barnett at UBS pointed out that GDP growth forecasts for the euro area

in 2006 have been revised up in recent months.

"We believe that it would not take much for the consensus growth forecast to

be upgraded further and that this would likely be seen as suggesting more ECB

tightening than is currently priced in," she added.

Today, the economic news was a tad friendlier for the bond market, with

French household consumption of manufactured goods falling 1.0 pct in December,

compared with a downwardly revised 0.7 pct rise in November. However it only had

a fleeting impact on bond prices.

"The slowdown in consumption bears out our assumption that real GDP growth

in the final quarter will have been more modest than in the third quarter, and

we envisage a figure of 0.4 pct quarter-on-quarter," said Christoph Weil of

Commerzbank.

Later on, attention will fall on ECB chief Jean-Claude Trichet's speech in

Stuttgart. Any hint of further hawkishness may lead to renewed falls in bond

prices..............................

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The public finances are in an appalling state bearing in mind we're not in recession yet........

A 3.5% of GDP overspend is fine in a slump but where we are now in the economic cycle we should be more or less breaking even.....

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Look at PoG on Riser's post! It spiked at 567! So much for a pull-back. The world is getting too exciting for cheap gold now. Amazing how fast things are falling apart. Back in August things still seemed normal.

Isn't it as if the powers that be sense they are running out of time and so they are pressing for a conclusion of some sort?

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The public finances are in an appalling state bearing in mind we're not in recession yet........

A 3.5% of GDP overspend is fine in a slump but where we are now in the economic cycle we should be more or less breaking even.....

Agreed, to be borrowing so much at a time of above average growth is a disgrace that shows that Brown has lost control of the public finances.

Lets not forget all of the off balance sheet financing that's going on as well: Railtrack, PFI etc.

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  • 301 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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