Wednesday, August 13, 2014

A low growth, low wage and debt economy…

Wage growth in shock collapse as unemployment rate continues to fall

Average weekly earnings contract for first time in seven year amid buoyant jobs market. British workers earned less between April and June than they did in the same period last year, even as the unemployment rate fell once again, official figures showed.

Posted by hpwatcher @ 10:11 AM (5415 views)
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24 thoughts on “A low growth, low wage and debt economy…

  • Not a shock at all. It’s all part of the new debt enslavement society.

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  • It’s because UK wages are ‘downwardly flexible’. The country has one of the most ‘flexible’ (least protective employment legislation, low union bargaining power) employment set-ups in the developed world. The increased employment of migrants and of over-65s whose pensions have been pilfered are also part of the explanation for low wages and the rise in employment. Another reason for increased employment is that when demand picks up it’s cheaper to hire people than it is to invest in plant, machinery, systems etc.

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  • Yup, just like India, millions of people, most in debt and all earning next to nothing. The future is poverty…

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  • This is been apparent to most people for some time. The other side of the coin, is real inflation eroding standards of living. I wonder whether GDP will ever become discredited in mainstream media as a measure of the health of the economy.

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  • This is been apparent to most people for some time. The other side of the coin, is real inflation eroding standards of living. I wonder whether GDP will ever become discredited in mainstream media as a measure of the health of the economy.

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  • Thecountofnowhere says:

    The powers that be wont want to hear this but…..WE NEED DEFLATION !!!!!

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  • mountain goat says:

    Artcile in the FT yesterday Record income gap fuels US housing weakness. The income gap between America’s richest and poorest metropolitan regions has reached its widest on record, shaping an uneven housing recovery that threatens to hold back the broader revival of the world’s largest economy.

    Funny money policies creating crony capitalism. Lets hope we get a real economic recovery so QE can stop and IR normalise.

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  • I wonder whether GDP will ever become discredited in mainstream media as a measure of the health of the economy.

    Already has….but you won’t read about it in the mainstream press; they seem to be doing their best to push the ”recovery” propaganda.

    Lets hope we get a real economic recovery so QE can stop and IR normalise.

    Absolutely NO chance of either. Forget it.

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  • A recovery [to a higher standards of living] for me would include static wages, price deflation and asset price collapsing.

    In reality that means a strengthening pound and higher interest rates.

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  • mountain goat says:

    Lets hope we get a real economic recovery so QE can stop and IR normalise.

    Absolutely NO chance of either. Forget it.

    Might as well buy a house then, if you believe that, since money debasement will just go on and on and people will keep doing what they have done; flee to housing as a hard asset and load up on debt because IR are nailed to the floor.

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  • Might as well buy a house then, if you believe that, since money debasement will just go on and on and people will keep doing what they have done; flee to housing as a hard asset and load up on debt because IR are nailed to the floor.

    Money debasement – I think this is what’s going to happen, that and tax and more tax of course. Things simply aren’t improving and they have the scope to get a lot worse. All the while the debt is getting bigger and bigger. Gold is always good though.

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  • mountain goat says:

    Gold is always good though

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  • mountain goat says:

    Falling wages is inflation by the back-door so BoE will be pleased.

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  • mountain goat says:

    close i

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  • Gold and silver are good but easily controlled/confiscated/outlawed.

    Not really; when bought in small, but frequent amounts no declaration is needed. They are also PORTABLE….which means they can be moved around very easily. If you buy 1 oz Britanias they are wholly CGT free and VAT free too.

    To be honest the ”confiscation” scare story is silly; that only happened because the dollar was gold backed, so new money could not be printed without the respective gold. That restraint simply doesn’t exist today – ask Ben. Moreover, gold is such a small cottage industry and the derivatives industry so MASSIVE, there is simply no contest, because gold simply couldn’t cover it….so no point in going there.

    Falling wages is inflation by the back-door so BoE will be pleased.

    It’s actually deflationary. If no one is earning, no one is borrowing and spending – hence government lies over the recovery and the free money for banks.

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  • Great comment about interest rate rises:-

    oldwease
    Well, normally the rise would be in response to, or, heaven forbid, in anticipation of a pick up in the rate of inflation.

    Since the rate of inflation is a massive piece of data fraud in the UK, such an event is strictly controlled.

    The UK economic ‘miracle’ is, in fact, predicated upon the same fraud as the excess of genuine, underlying economic inflation over and above the fraudulent ‘official’ number miraculously translates into ‘growth’.

    So, the government and BoE can trigger massive house price inflation, a staggering 15% plus in London, and none of that is inflationary. Asset bubbles in the UK do not equate with inflation, wholly unrelated. In fact, when the asset bubble is in residential property, it’s heralded as a great success.

    And, in some ways, it is a great success. Why? Because the inflated property assets provide a means for the government of the day to get their hands on peoples’ liquid assets as new levies on property are met out of hard cash. In addition, of course, the government hopes that people will borrow against their phantom equity and consume even more.

    The government couldn’t care less if you’re mortgaged up to the hilt. That isn’t going to prevent them getting at your liquid capital through property inflation.

    So, there you have it folks. ‘Official Inflation’ is under control because the fraudsters invent the number. Real inflation magically translates into growth. In addition, of course, it also translates into greater debt and leverage.

    So, the answer to the question of when rates will eventually rise is probably the following.

    It will happen right around the time that the government of the day (probably Labour) and the BoE announce capital controls and strict limits of bank withdrawals. That will be marginally before they simply steal the captive bank deposits to prop up insolvent government.

    By that stage, of course, the collapse is total and it doesn’t really matter anymore.

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  • Dodgy GDP

    “Dodgy theories and discredited statistics which are used by agencies like the OECD camouflage the trends that determine the health of the economy — and people’s welfare. Prof. Mason Gaffney explains why we should treat GDP data with extreme caution, and he identifies holes in the numbers used by governments.”

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  • http://www.housepricecrash.co.uk/forum/index.php?/topic/195677-the-wages-must-rise-to-support-recoveryhousing-thread/page-31#entry1102565862

    FreeTrader, on 11 Aug 2014 – 06:14 AM, said:

    Something to be aware of this coming week.

    On Wednesday ONS will release the monthly labour market report and we’ll get the latest average weekly earnings figure.

    This month’s figure for total pay growth will be particularly distorted by the timing of bonus payments in 2013, and as a consequence we may see a negative print for the 3-month year-on-year comparison (which is what ONS always uses in its headline summary).

    The figures in red below show the market’s expectation of this month’s reading.

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  • http://www.housepricecrash.co.uk/forum/index.php?/topic/195677-the-wages-must-rise-to-support-recoveryhousing-thread/page-31#entry1102565862

    FreeTrader, on 11 Aug 2014 – 06:14 AM, said:

    Something to be aware of this coming week.

    On Wednesday ONS will release the monthly labour market report and we’ll get the latest average weekly earnings figure.

    This month’s figure for total pay growth will be particularly distorted by the timing of bonus payments in 2013, and as a consequence we may see a negative print for the 3-month year-on-year comparison (which is what ONS always uses in its headline summary).

    The figures in red below show the market’s expectation of this month’s reading.

    If we do get a negative earnings growth rate then you can be pretty sure it will make headlines, despite it being a misleading figure.

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  • Does anyone know whether there are any restrictions in taking gold coins abroad? If so do they show up in airport scanners. I’m thinking of say 6 gold coins at a time with a value of 5k or more if there was no risk. I just wondered whether if they were sitting in my wallet whether they would show up just as normal coins or or something special.

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  • Does anyone know whether there are any restrictions in taking gold coins abroad

    Not sure about this one; obviously stacks and stacks would probably receive attention…..the coins actually have a face value of £100.00 so you might be able to get away with storing them in a purse, with other coins, claiming that they are money…which they are.

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  • HP Watcher, actually, when interest rates can’t fall further, the next shoe to drop is lower taxes, and with lower UK corporate rates they are proving once again the bell shaped curve, that when taxes are too high, that if they fall, tax receipts rise. Like, if you had 100% tax, you would get zero tax receipts, and when they raised the higher rate of tax to 50%, the tax take from that bracket fell in half.

    I am actually expecting that government’s, to retain their income and power, will start cutting taxes. I believe that is the real trend, and that the recent French adventure into crazy land taxes was possibly the high water mark.

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  • Frankly, regarding gold, I think we will see a further pull back, to maybe $800. YES, gold always goes up, over the long term, but remember that the cycle for gold can outlive your lifetime. Look at the 1980’s peak and the year 2000 trough. Right now, if you are renting, you are better off using spare cash as downpayment for a house.

    I think that the next up-leg for gold could be quite a while away. It will reach $10,000 an ounce, but maybe not until 2030.

    I will be the first one to ride that wave, but the momentum is not behind it, gold needs to find a stable bottom first, and last big sell off. Something like the Brown gold sale. Maybe start buying next time the BOE makes a big sale?! Though, things never repeat exactly, so maybe look for a big sale from Russia or India to mark the next bottom in gold prices?

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  • Actually, China would be the one to watch. Maybe in ten to 20 years, look for a massive sale from China of bullion, and you know you are in the next bull market, but for now, there has not been the capitulation required for gold to rise and, deflation is in Europe. No chance of gold soaring right now.

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