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yellerkat

Why The British Economy Will Plunge Into Depression

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Think I'll go back to bed! :ph34r:

Axis of Logic article.

Worse, as the inevitable reality strikes and rates rise to stem inflation, now technically well above four percent and heading for five, this will trip the last lack of affordability factor on the average British family’s budget.

With rapidly escalating food, fuel and heating costs, as well as raised taxes, a small hike in mortgage rates in the nature of 1.5-2% will prove the tipping point. Mortgage facilities and house sales are now at a thirty-year low: this trend is due to accelerate. The support activities – all those white vans – and the vast network of businesses importing and selling goods of all sorts, mainly on the back of a synthetic “Feel Good” factor, imbued by consumers feeling suddenly awash with illusory “Profit” from insane house price escalation, will crash.

Unemployment will rise; the Chancellor’s tax take will plunge further. Having borrowed to the hilt and wasted all the cash on grandiose schemes such as the NHS computer system, which despite now exceeding £10 billion plus, still doesn’t work, he has nowhere to go.

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No, no, it's OK. we still have all that gold.

We do still have all that gold?

Don't we?

What do you mean....?

Well, er, have you looked down the back of the sofa...?

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I have a friend who works at the BOE, and he said to me that they expect a major economic crash, but would not reveal any details, as he is not allowed to say, or does not trust me.

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We are almost certainly going into recession and most of the population seems to have accepted this already.

What's the difference between recession and depression?

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I have a friend who works at the BOE, and he said to me that they expect a major economic crash, but would not reveal any details, as he is not allowed to say, or does not trust me.

phew were saved... no crash here... the bank of england expects one.... one sure fire contra indicator....

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I have a friend who works at the BOE, and he said to me that they expect a major economic crash, but would not reveal any details, as he is not allowed to say, or does not trust me.

My younger sister's doing an internship there this summer. I've told her to look for the remote control for the printing presses and to press the "off button".

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I have a friend who works at the BOE, and he said to me that they expect a major economic crash, but would not reveal any details, as he is not allowed to say, or does not trust me.

Wouldn't be great to be working at the BOE and have every piece of data at your finger tips. We nearly have the same with the internet - just have to filter through all that opinion, spin, advertising and lies.

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The guy on the YouTube video looks like a genuine 'fat cat'. But he explained it all very clearly.

If he forsees very high inflation, why does he suggest holding mainly cash?

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If he forsees very high inflation, why does he suggest holding mainly cash?

Because he thinks that the PC screen bit of the banking system will be rejected by the general population and that the banks will close it down.

At that point people will still need cash to (amongst other things) pay taxes and so it's worth having.

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Guest absolutezero
We are almost certainly going into recession and most of the population seems to have accepted this already.

What's the difference between recession and depression?

As someone else said:

A recession is where the economy falls down.

A depression is when the economy falls down and can't get back up again.

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If he forsees very high inflation, why does he suggest holding mainly cash?

I can only assume he thinks the inflation bit wont last long once the debt deflation overcomes everything else.

Their is not a lot else you can do atm. Stocks are a no go for a while (I believe even Japan may not be as good a investment as MoneyWeek thinks) The only bubble we have left is the commodities, they are likely to go pop soon once they release we are not pulling out of this nose dive.

My view on gold is it would have been a great hedge against inflation if bought in 2003-4 but now it is more a case of buying it if you subscribe to complete meltdown (not holding any gold atm but always keep an eye on it!)

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We are almost certainly going into recession and most of the population seems to have accepted this already.

What's the difference between recession and depression?

A depression involves a debt liquidation followed by debt revulsion. Essentially after a depression a whole generation will be reluctant to borrow for the rest of their lives.

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We are almost certainly going into recession and most of the population seems to have accepted this already.

What's the difference between recession and depression?

This article has some seemingly reasonable definitions:

http://economics.about.com/cs/businesscycl...depressions.htm

In summary (from page 2), if GNP falls by 10% or more then it's a depression, any less and it's a recession.

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I have a friend who works at the BOE, and he said to me that they expect a major economic crash, but would not reveal any details, as he is not allowed to say, or does not trust me.

They've finally woken up to the fact that UK Plc is broke? Wow, there must be some clever chaps working there.

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I was shopping in Exeter today and there were Labour Party activists forcefully handing out leaflets and begging people to support Labour the architects of the NHS!

My wife shouted, "You're rubbish"! as we walked past, they reacted by shouting, "If you don't support us, you don't support the NHS"!, to which my wife shouted back, "Don't support how much it costs more like you bunch of wasters"!

I wish I'd hung around really and quizzed them about billions wasted on NHS computer systems, Labour's creation of MRSA and huge financial mis-management but it would have been a complete waste of time because they are, and always will be in complete denial about any of their failings! And anyway it was raining and I didn't want to waste one more second of my life communicating with the lowest form of scum on the planet!

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What's the difference between recession and depression?

There is always much disagreement on defines a recession, but less on what a depression is. A depression rare and is usually spawned by some external stimulus like the great depression. A recession is part of a normal economic cycle which occurs at frequent intervals depending on the literature, anywhere from 5 to 8 years between small recessions is normal. They last for about 10 months on average.

Determining a recession cannot be done by looking at the stock market. The stock market can go down and up during a recession - the stock market's direction is fuelled in part based on emotion rather than economic influences. The stock markets movements beyond the emotional based selling/buying is reactive, and moves based on historical data which may or may not be reflective of a trend or the current economy. But of course, as you notice in even this thread, people try to do it anyway's . Its completely inaccurate, and the media knows this - but I think people get the perception that you can somehow judge the overall well-being of the economy through the DOW average due to media hype. It just isn't that simple.

Statistically significant and successive decreases in the gross domestic product - or the actual (market) value of everything produced in the country - is usually the widely accepted measure of a recession, as you have already quoted. The good news is the GDP is not fuelled by emotion like the stock market is, but it is still based on historical data. An examination of GDP must be concurrent, as you cite, with unemployment claims and consumer spending. However, we also know that unemployment and consumer spending acts in yearly cycles, and the beginning of the year is usually marked by high unemployment (Christmas layoffs) and slow-downs in consumer spending. These numbers need to be examined in a seasonally adjusted way to be accurate.

Everyone will know it when we enter into a depression. A depression is so extreme that you'll see riots, massive sale off 's that make the current volatility look like child's play, and extreme inflation or deflation (depending on the external stimulus). I have to chuckle at some of the people on the board calling for a depression, as I have seen NO economist - even the most "negative" one - predict a depression. The most I've seen called for is a severe recession on the "negative" side, and a mild recession on the "positive" side.

Edited by poorman

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I have a friend who works at the BOE, and he said to me that they expect a major economic crash, but would not reveal any details, as he is not allowed to say, or does not trust me.

Keep talking crap, no-one believes your bul*s*t stories any way.

Edited by debt-free

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This article has some seemingly reasonable definitions:

http://economics.about.com/cs/businesscycl...depressions.htm

In summary (from page 2), if GNP falls by 10% or more then it's a depression, any less and it's a recession.

Well that probably means we won't see a technical Depression in the same way we are not seeing a technical recession in the US currently due to the way they "calculated" GDP these days.

The index for each industry represents the volume of GVA created by that industry compared to the 'base' year (currently 2004). Figures are deflated to remove the effect of price changes over time to produce an estimate of real terms (or constant price) growth in that industry. The figures are seasonally adjusted to remove the effect of seasonality in certain industries.

Got this definition after a quick Google search http://www.scotland.gov.uk/Topics/Statisti...omy/GDP/GDPcalc

Now if you understate inflation (as if a government would do that!) then low and behold your GDP is overstated, genious. This is a point Peter Schiff tries to make when people argue we are not in a recession but they rarely give him any time to educate them.

Also we have our friend seasonally adjusted which clearly gives further fudge factors.

Edited by Confounded

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Keep talking crap, no-one believes your bul*s*t stories any way.

Keep your friends close. and your enemies closer.

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We are almost certainly going into recession and most of the population seems to have accepted this already.

What's the difference between recession and depression?

A recession is when your friend loses his job.

A depression is when you lose your job.

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Now if you understate inflation (as if a government would do that!) then low and behold your GDP is overstated, genious. This is a point Peter Schiff tries to make when people argue we are not in a recession but they rarely give him any time to educate them.

I would be very interested to read a discussion of how the GDP deflater is calculated and used... I'm aware of its broad purpose - but suspect the interesting detail is in the detail...

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  • 399 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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