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TheCountOfNowhere

Is a full blown currency crisis happening....

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Are we about to see a full blown currency crisis ?

With inflation at 1.6% and savings rates at 0.fec all % then I can see more and more people piling into the housing bubble and stock market now with their lives savings, push prices up to almost unimaginable levels.

Is it time to say we are well and truly screwed and should just invest in Bricks and mortar before we loose it all ?

The bankers have everything, they hold all the assets, they control the government, they do as they wish.

IMHO, the bankers have won.

 

 

 

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A currency crisis is inevitable. Once they started printing money it should have been pretty obvious to everybody how screwed the system is.

I have already exited. Don't panic last!

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If it is indeed a crisis (which I doubt) then this might force the hand of the BOE to increase rates. They will have to be forced as they will never increase rates voluntarily as a result of the absurd "forward guidance".

As for inflation they will "look through" it as they did in 2011 but even this has limits. If inflation does go up and wages follow then, again, the BOE may be forced to act; they cannot do nothing in all circumstances.

They know that any rate increase will kill the Ponzi and they will resist to the last but there is a "last" despite what many may think.

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14 minutes ago, TheCountOfNowhere said:

Are we about to see a full blown currency crisis ?

With inflation at 1.6% and savings rates at 0.fec all % then I can see more and more people piling into the housing bubble and stock market now with their lives savings, push prices up to almost unimaginable levels.

Is it time to say we are well and truly screwed and should just invest in Bricks and mortar before we loose it all ?

The bankers have everything, they hold all the assets, they control the government, they do as they wish.

IMHO, the bankers have won.

 

 

 

Banks are like a tumour, they feed and feed until  they drain the host of resource. They dont even realize that if they kill the host they die too. The greedier they get the sooner the host dies unless of course the host decides to violently excise them with a knife which is also likely.

 

What are you betting on will happen first?

 

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15 minutes ago, doomed said:

The government borrow £10B a month to cover spending; interest rates will not be going up.

And when you and I stand outside parliament with a large blade and some 4 x 4, what then ?

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5 minutes ago, TheCountOfNowhere said:

And when you and I stand outside parliament with a large blade and some 4 x 4, what then ?

Too far gone for that. Collapse baked in now imo.

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The UK has debt/GDP of ~90% at the mo.

The UK is running a budget deficit of ~6% and current account deficit of ~7%

The budget deficit seems to be stuck there i.e. its structural. At this rate we have ~5 years left before we go into somethign similar to Greece - but without the EU bailout - basically public spending will have to be slashed.

Every one - well my family and my partners workmates (public sector) seem to think things are OK. But Brown really did make his mark on the UK and its not been fully felt yet.

In 10 years time Brown and Balir will be dragged thru the street and hung upside on lampposts.

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6 minutes ago, TheCountOfNowhere said:

And when you and I stand outside parliament with a large blade and some 4 x 4, what then ?

the men (or women) in white coats will take you away

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25 minutes ago, crouch said:

If it is indeed a crisis (which I doubt) then this might force the hand of the BOE to increase rates. They will have to be forced as they will never increase rates voluntarily as a result of the absurd "forward guidance".

As for inflation they will "look through" it as they did in 2011 but even this has limits. If inflation does go up and wages follow then, again, the BOE may be forced to act; they cannot do nothing in all circumstances.

They know that any rate increase will kill the Ponzi and they will resist to the last but there is a "last" despite what many may think.

This is the failure in the system and thinking.. 'If inflation does go up and wages follow''  No, wages wont follow and they have not for years.  Workers do not have pricing power any more with all the levers of globaisation at hand, ie offshoring and mass immigration and almost no unions, never mind automation etc.  

Just look at house prices.. They have had real inflation beyond all imagination and what affect have they had on wages?  none... This is the neo liberal wet dream come to fruition, increasing prices in everything and workers can do nothing about it.  Worse is how our politicians are uncaring or oblivious to the end game of all this when people will be living in the streets just like any other 3rd world country like for eg the USA or the Philippines etc corrupt crony capitalism at its best.

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30 minutes ago, doomed said:

The government borrow £10B a month to cover spending; interest rates will not be going up.

Sadly, as they do borrow 10bld for spending IRs will be going up.

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7 minutes ago, spyguy said:

The UK has debt/GDP of ~90% at the mo.

The UK is running a budget deficit of ~6% and current account deficit of ~7%

The budget deficit seems to be stuck there i.e. its structural. At this rate we have ~5 years left before we go into somethign similar to Greece - but without the EU bailout - basically public spending will have to be slashed.

Every one - well my family and my partners workmates (public sector) seem to think things are OK. But Brown really did make his mark on the UK and its not been fully felt yet.

In 10 years time Brown and Balir will be dragged thru the street and hung upside on lampposts.

Perhaps, unlike Greece.. They could collect the taxes that the offshored companies dont currently pay?

  As for Blair and Brown, sorry folks it goes back a lot further than this.. The neo liberal nightmare began with Regan/Thatcher after politicking from right wing think tanks for the 20 preceding years.   The last labour govt failed to reign this in and in fact behaved just like a Tory government or in fact were just the caretakers till the real thing came back.

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Currency crisis? No the pound will just continue its downwards spiral. Look back to the 70s and 80s and see how Marks or Francs you could buy then for your quid.

You can also put your money into foreign stocks, priced in US$, Aus$, Euro, Swiss Francs etc.

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1 minute ago, steve99 said:

This is the failure in the system and thinking.. 'If inflation does go up and wages follow''  No, wages wont follow and they have not for years.  Workers do not have pricing power any more with all the levers of globaisation at hand, ie offshoring and mass immigration and almost no unions, never mind automation etc.  

Just look at house prices.. They have had real inflation beyond all imagination and what affect have they had on wages?  none... This is the neo liberal wet dream come to fruition, increasing prices in everything and workers can do nothing about it.  Worse is how our politicians are uncaring or oblivious to the end game of all this when people will be living in the streets just like any other 3rd world country like for eg the USA or the Philippines etc corrupt crony capitalism at its best.

Indeed and that is my point; wages are most unlikely to follow, which means that the rise in inflation will be temporary and can therefore be dismissed. The fact that the index will still go up and reduce real wages (again!) means nothing; what happens is the gradual impoverishment of all.

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29 minutes ago, Sandwiches33 said:

Banks are like a tumour, they feed and feed until  they drain the host of resource. They dont even realize that if they kill the host they die too. The greedier they get the sooner the host dies unless of course the host decides to violently excise them with a knife which is also likely.

 

What are you betting on will happen first?

 

Like Iceland would be nice.

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Just now, steve99 said:

Perhaps, unlike Greece.. They could collect the taxes that the offshored companies dont currently pay?

  As for Blair and Brown, sorry folks it goes back a lot further than this.. The neo liberal nightmare began with Regan/Thatcher after politicking from right wing think tanks for the 20 preceding years.   The last labour govt failed to reign this in and in fact behaved just like a Tory government or in fact were just the caretakers till the real thing came back.

The tax offshore pay/dont pay is just tranfer pricing. Its really a p1ss i nthe ocean.

Its *really* does go back to Brown. In 97 UK debt was reducing from ~35% GDP. Government spending was falling from 40% of GDP.

After Brown, UKGOV spending was above 50% GDP, a budget defcit of 12% GDP was started increasing debt at a fair clip. And youve got all of browns schemes that are coming home to roost too.

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12 minutes ago, Sandwiches33 said:

Banks are like a tumour, they feed and feed until  they drain the host of resource. They dont even realize that if they kill the host they die too. The greedier they get the sooner the host dies unless of course the host decides to violently excise them with a knife which is also likely.

 

What are you betting on will happen first?

 

I did think for a long time the MPs would do the decent thing and end this madness years ago, but they clearly wont.

In 2010-2011 it felt like the next leg down was just around the corner, rates would rise and prices would slowly decline to sane levels, then came along Osborne/Cameron and Carney.  The 2 MPs clearly lied through their teeth to get into power, or were presented with some unconfirmtable facts ( or lies ) when they took office, then they let the madness loose.

Even after BrExit they made a few noises RE getting rid of Carney.  

But still he sits there like a king, f**king over millions of people.

Still he prints and I am sure he is eyeing a 0% IRs cutr in the future, to help us all of course.

They must surely know inflation is coming and still they do nowt

They must surely see the insanity of the Uk house prices and still they do nowt.

They have index linked pensions and massive VIs in property, why would  they ?

To say we are facing a massive problem in the UK is the understatement of my time on HPC.

 

 

 

 

 

Osborne and Cameron, traitors in my book, said all the rigth things till they took power, then did the opposite.

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4 minutes ago, steve99 said:

Perhaps, unlike Greece.. They could collect the taxes that the offshored companies dont currently pay?

  As for Blair and Brown, sorry folks it goes back a lot further than this.. The neo liberal nightmare began with Regan/Thatcher after politicking from right wing think tanks for the 20 preceding years.   The last labour govt failed to reign this in and in fact behaved just like a Tory government or in fact were just the caretakers till the real thing came back.

It may have started then but there has been ample time to address things.

nobody ever turned around a business, team or anything in decline by just taking more debt.

It always looks like they want to tinker > print > declare victory and then bugger off to consult for gGoldman/jp morgan etc.

 

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They cannot afford to impoverish the population any more. The banks need to lend to someone, the money supply needs to keep increasing.

So some how they must increase the individuals spending power. So far they have done that by lowering rates. But that game is nearly over and has failed.

My guess is import tariffs and money controls, these will impoverish people more, but the gain may eventually triccle down.

They really need to get more money to people.

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They could just print it and hand a cheque for £10,000 to everyone? In fact, why not make it £100,000?

Edited by Errol

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5 minutes ago, Errol said:

They could just print it and hand a cheque for £10,000 to everyone? In fact, why not make it £100,000?

If they did that, it would be the first money that I would spend instantly upon receipt. Probably on buying a yacht.

Edited by LiveinHope

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23 minutes ago, spyguy said:

Sadly, as they do borrow 10bld for spending IRs will be going up.

QE to the rescue.

'Free' money for the government (who will never have to redeem the Gilts and don't have to pay coupon on them) and suppressed yield for government debt, meaning downward pressure on interest rates for non-sovereign debt.

 

Plus unlimited central bank provided liquidity for the commercial banks, meaning that they don't have to rely on investor deposits.

What could possibly go wrong?

 

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The UK is truly screwed. Not just public and personal debt but trade balance and property megabubble. Its a perfect storm. If you have a look at Forex factory calendar they alway haves the house price indices (Rightmove Halifax etc) unlike other countries because UK property is a big part of the economy. Crashing UK house prices will equate to crashing £.

I have followed Deutschmark/Euro rates against the £ for decades. Yes there are Eurozone probs in Greece Italy but the UK has not got German industrial might to bail us out. There are not really any property bubble on the Continent compared to UK. Also UK is still overvalued - see my post and reasoning in the other £ thread.

 

Long term £ will be worth about 85 to 90 Euro cents i.e. less that a Euro

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