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Even The Dozy Tories Have Finally Woken Up.....

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Leading Tory blog wakes up to grim economic realities:

The good economic times appear to be over for Brown and debt-ridden Britain

John Redwood's blogging has been indispensable reading over recent days. He's been dissecting the economic developments that have been dominating the news and has rightly questioned the decision to publicise the fact that Northern Rock was accessing the Bank of England's lender of last resort facilities.

In an article for The Sunday Telegraph, David Cameron joins the debate. The Conservative leader welcomes the liquidity lifeline given to Northern Rock by the Bank of England, asks a few pointed questions about financial regulation and then critiques the Government's handling of debt issues:

"Though the current crisis may have had its trigger in the US, over the past decade the gun has been loaded at home. Under Labour our economic growth has been built on a mountain of debt. And as any family with debts knows, higher debt makes us more vulnerable to the unexpected. In short, the increases in debt in the UK have added a new risk to economic stability.

Over the past decade, the level of personal debt has trebled, to £1.3 trillion. We owe more than our entire national income. So now when interest rates go up, the impact on homeowners escalates. Mortgage payments are at their highest for 15 years. Add in Gordon Brown's stealth tax rises, and real take-home pay for the average family is falling. No wonder insolvencies have quadrupled in the past 10 years, and are now at record levels. Someone goes bust in the UK every seven minutes.

Meanwhile, for all its past talk of prudence, the Government has been on a spree of gigantic proportions. Despite the world economic boom, Gordon Brown is borrowing £35 billion a year - more than the entire schools budget. No wonder the IMF has said that this cannot continue: our Government is borrowing more than any other in Europe. It takes quite something to make Italy's borrowing look prudent."

Householders are certainly facing the squeeze. The Business reports that increases in base rates over the past year have added nearly £80 to typical monthly repayments on a £100,000 mortgage. June loans to first-time buyers fell by 7% in number and 4% in value. Credit card and other borrowings are also pinching consumers.

It is not yet clear, however, if bad economic times will benefit the Conservatives. A Populus poll for Friday's Times suggested that the Brown-Darling team was preferred over the Cameron-Osborne team by 61% to 27% to handle difficult economic times. 'Hold on to nurse for fear of something worse' appears to be the voters' motto - as it was in the 1992 recession when voters had to choose between John Major and Neil Kinnock. Over at UK Polling Report, Anthony Wells rightly urges us to be a little cautious about this poll finding, however. He asks us to remember all those pre-Brown polls that suggested voters wouldn't welcome him as Prime Minister. He writes:

"We’ve seen with the hypothetical polls from before Brown became Prime Minister that people aren’t actually very good at predicting how they would react to events in the future. In reality we cannot tell if, faced with economic troubles, people would turn to Gordon Brown…or blame him."

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Indeed,John Redwood's Blog puts the situation very simplistically

The credit crunch

Published by John Redwood under Blog

The twin decisions to tighten money and to reveal the name of a bank that needed to use the lender of last resort facility have done considerable damage to confidence in the UK. Attempts to lay the blame on sub prime mortgage lending in the USA will not provide a full explanation of what has gone wrong here at home. The UK authorities decided not to intervene in the 3 month money markets, allowing a further increase in these interest rates that mattered over and above the substantial increase in Minimum Lending Rate the Bank has brought in since the election. The markets were too tight for comfort, just as they were too easy a couple of years ago when borrowing was on a big scale.

The Chancellor told me a few weeks ago that mortgage regulation was necessary and implied it was working well. He needs to rethink his position. How could we get into the current position if mortgage regulation was working so well? The government after all, increased regulation well before this problem hit. It is another case of regulation that cannot deal with the most important problems affecting the market. The difficulties have been created by the credit crunch, which has changed circumstances substantially. The crunch has been brought on by the authorities shifting belatedly from interest rates that were too low to interest rates that are too high. They are going to have to cut rates. I expect the US will start the move soon. The UK will have to follow.

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"Dozy Tories" Oh how naive!

They are QUITE clever these chaps you know.

They've waited to pounce.... Labour needed to be given enough rope to hang themselves without any apparent input from opposition.

Now it's clear how the problems are Labour-made pure and simple.

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"Dozy Tories" Oh how naive!

They are QUITE clever these chaps you know.

They've waited to pounce.... Labour needed to be given enough rope to hang themselves without any apparent input from opposition.

Now it's clear how the problems are Labour-made pure and simple.

I do hope you're right but I still think they've been dozy, and Redwoods call for lower IRs is foolish. Still, at least they seem to have finally sat up and took notice so let's hope for a full on onslaught on Brown from now on.

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I don't think the Tories have a leg to stand on.

.

1) They have presided a recent housing boom

2) They have said virtually nothing about the debt mountain of the last decade.

.

Instead they bang on about "green issues" etc....

.

Its all very well saying "we would have done things differently" but they have never

once put their C0(k on the block and said stop this stupid lending.

.

ST

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He's not 'calling' for anything!! He's a politician and everything he says is to make it hotter for the government!

Just watch the sleeping lion of the Conservative Party as they begin to snap at the heels of the mafia gang we let run our country.

Any New Labour members reading this? You are spineless, conniving runts and you deserve to be voted out then kicked into the Channel. You and your party are a disgrace. F off and never ever come back to darken our doors you retarded criminals.

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"Dozy Tories" Oh how naive!

They are QUITE clever these chaps you know.

They've waited to pounce.... Labour needed to be given enough rope to hang themselves without any apparent input from opposition.

Now it's clear how the problems are Labour-made pure and simple.

I think they have definitely been deliberately slow to come out of the woodwork on this one. I am sure everyone knows how hard it has been to persuade the majority of people that the economy is not as rosy as all seems. A few months ago they would have looked to be churlish to the majority that have enjoyed fantastic increase in personal wealth. Now with this on the table people may actually start to engage their brain and be more receptive to the criticisms.

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Redwood is a simple minded monetarist that believes in minimum regulation.

No surprises there. He comes from a planet where that form of economics works and where people have sex by taking pills.

:lol::lol::lol: Redwood is such a voter turn off - die hard Tories just dont get it i'm afraid. Bring back Ken Clarke :lol:

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The most base role of the opposition is to counter what the goverment says and

"make things hotter for them".

.

What they should be doing is pointing out dangerous/incorrect govt policy and offering

alternatives.

The tories have been a sad and shambolic opposition whose only tactic has been to

naysay the govt and focus on every issue that didnt matter.

.

ST

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I do hope you're right but I still think they've been dozy, and Redwoods call for lower IRs is foolish. Still, at least they seem to have finally sat up and took notice so let's hope for a full on onslaught on Brown from now on.

But that's half the fun of being in opposition, they know Labour can't lower interest rates or stop the crash but that people will think it sounds like a good idea and places more blame on Labour Policy.

As things get worse they can suggest cutting IHT , Stamp Duty, Fuel Duty, keeping nurses pay in line with inflation, moving tax bands to benefit the poorest, and all the fiscal drag methods Labour have used to regressively tax the public.

Labour can't implement anything and it's getting harder to squeeze any more tax out of people, cutting public sector wages by letting inflation erode them is about the last method available, even taxing non domiciles or corporations using PE to avoid or even reclaim tax through private pension funds won't work as they will just walk away to other places around the world who will welcome them like long lost children.

If the Tories/Conservatives were to finally get some self confidence they could batter New Labour/Labour into the ground, just by helpfully pointing out ways to fix the problems as they occour.

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He contradicts himself!

One the one hand, we have a RATIONAL free market response to a insane credit mania - raise interest rates and borrowing terms - Yet he argues, as it later becomes clear there are to be losses and increased defaults and risk has been mispriced, and the banks should have bailed them out!

On the other hand some regulation to prevent aggressive insane excesses is an assault on the idol of the 'free market'!

Noting the market in weapons, drugs and alchohol is regulated to prevent excesses, could it be that some independant regulation of a market is a result of consumer wants, desire and satisfaction and thus an essential part of a market model?

He is right though - if the interest rate hadn't delibrately been kept under the real costs of living we would not have any of these disasters. A clear example of how the central banking system creates booms and busts.

Indeed,John Redwood's Blog puts the situation very simplistically

The credit crunch

Published by John Redwood under Blog

The twin decisions to tighten money and to reveal the name of a bank that needed to use the lender of last resort facility have done considerable damage to confidence in the UK. Attempts to lay the blame on sub prime mortgage lending in the USA will not provide a full explanation of what has gone wrong here at home. The UK authorities decided not to intervene in the 3 month money markets, allowing a further increase in these interest rates that mattered over and above the substantial increase in Minimum Lending Rate the Bank has brought in since the election. The markets were too tight for comfort, just as they were too easy a couple of years ago when borrowing was on a big scale.

The Chancellor told me a few weeks ago that mortgage regulation was necessary and implied it was working well. He needs to rethink his position. How could we get into the current position if mortgage regulation was working so well? The government after all, increased regulation well before this problem hit. It is another case of regulation that cannot deal with the most important problems affecting the market. The difficulties have been created by the credit crunch, which has changed circumstances substantially. The crunch has been brought on by the authorities shifting belatedly from interest rates that were too low to interest rates that are too high. They are going to have to cut rates. I expect the US will start the move soon. The UK will have to follow.

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Guest wrongmove
I think they have definitely been deliberately slow to come out of the woodwork on this one.

They have to be very careful, politically.

It is voters that have borrowed all this money. It's a fine line between dumping all the blame on the government, and critising potential voters - I don't recall Brown or anyone else actually holding a gun to borrowers heads?

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Guest wrongmove
Any New Labour members reading this? You are spineless, conniving runts and you deserve to be voted out then kicked into the Channel. You and your party are a disgrace. F off and never ever come back to darken our doors you retarded criminals.

Just get off the fence!

:P

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Guest Winnie
I do hope you're right but I still think they've been dozy, and Redwoods call for lower IRs is foolish. Still, at least they seem to have finally sat up and took notice so let's hope for a full on onslaught on Brown from now on.

Yes, my problem with the Tories in this whole HPI thing is that they are capitalists to the core....cut rates, what a fool.

New Labour are just amateur nouveaux capitalistes...and have bungled it.

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People want LEADERS not followers. I am afraid the Tories will be like the Neithers on HPC.co and simply change sides when they see which way the wind is already blowing.

Now when Winston was a mere MP in the "wilderness years" he called WW2 and they all said he was a hyperbolic nutter. Then when Poland was invaded they all said Winston was a fine fellow.

For the Tories to be calling a crash now and blaming Gordon is pathetic. Where were they when HPI was rampant and pushing people out of owning a home? They were right there with the Socialistes Du Champagne with snouts buried deep in the same trough.

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