March in London on the 26th?

[Pinkribbonscars]

Once they get jobs and see their own money taken from their salaries...

 

[Slam62]

Ah, so now you are saying the only reason for the deficit is because the government purchased shares in ailing banks?

Shares it will shortly re-sell for more than it paid.

Well thats then then, surely, the problem will be solved when the shares are re-sold.
.

uh well, except that you would have to sell them all in one go, which would probably reduce their market value.

The problem is the banks that we control have a rather large quantity of illiquid assets which they are liable for and if they don't materialise, then we have to stump up the cash which would add 1.5trn to our national debt, I suspect most of these assets are uk or Irish property of some sort.

So we can probably never sell the shares.

 

[Kutter]

Hands up, whos just going to smash up maccy d's and a few banks and maybe do a bit of looting ?

 

[Tummy]

"I think we need a bigger coach!"

My plans to keep this a who's going have turned in to what I didn't want it to become

 

[Slam62]

The Banks caused Labour to spend too much money?

No, but the banks put themselves in an untennable fiscal position through reckless lending, this meant they had to with draw or charge more for all sorts of other funds lent to the uk economy, this in turn caused the economy to crash which massively reduced the tax take leading to the deficit we have now.

 

[Pinkribbonscars]

uh well, except that you would have to sell them all in one go, which would probably reduce their market value.

The problem is the banks that we control have a rather large quantity of illiquid assets which they are liable for and if they don't materialise, then we have to stump up the cash which would add 1.5trn to our national debt, I suspect most of these assets are uk or Irish property of some sort.

So we can probably never sell the shares.

As far as I can tell there is no need to sell them in one go - this would indeed be economic incompetence on the scale of Brown's as the market would depress the value before hand. There is even a Lib Dem suggestion to give the shares to the population, with the people taking the profit, probably won't happen though:

http://www.bbc.co.uk/news/business-12661005

 

[PermaBanned]

My plans to keep this a who's going have turned in to what I didn't want it to become

I think the tally's at three or four now?

 

[Kemik]

No, but the banks put themselves in an untennable fiscal position through reckless lending, this meant they had to with draw or charge more for all sorts of other funds lent to the uk economy, this in turn caused the economy to crash which massively reduced the tax take leading to the deficit we have now.

What about the argument that the bank's directors must increase the company value and it's up to the Government to regulate them to prevent the businesses doing things that may not be totally in the publics interest? In reality, the mortgage rates the banks offered was good for the Government at the time as it helped people buy new houses and the Government could promote the stats and felt it helped the construction industry.

While the bank should have been more ethical, the Government of the time are also to blame.

 

[Macro]

I'll try to break the economy down in to the most basic method and why I feel cuts at this level, or more are required.

1. The level of gearing by the UK Government (i.e. how much debt we have) has resulted in interest payments which pushing us close to bankruptcy. If bankruptcy, or close to it, occurs our debt will get more expensive. It's a vicious cycle. This debt interest should be spent on services which would make our life better.

2. If the Government completely removed one sector of public sector jobs, all of those people would be unemployed. However the gap in the market for the services the Government used to provide would now become very enticing to private companies. These companies will require the same skills as these newly unemployed people have and the best of them will be recruited. If the public sector was inefficient, bloated or the service generally wasn't required, those people wouldn't be recruited again aka, the sector would become more efficient. If the private company fails to provide a decent service, another better company would appear and customers would use that new company. Competition occurs and both companies become more efficient, prices fall, services get better, salaries increase as skills improve. This competition currently won't exist in a public sector as there is no other companies to compete against. The higher salaried staff spend more of their money, resulting in jobs for those who didn't get reemployed.

With the private companies, rather than the staff costing tax payers money, the staff become tax payers and therefore positive contributors to the country. The Government can then do things like pay off its debt and put more money in to services which private companies would find difficult to provide. A perfect, but extreme example, is Hong Kong.

If the cuts aren't this deep, interest will remain too high. We still have to borrow more money each year and this will increase interest levels each year and will continue until good years where we can decrease the debt levels (something labour should have done, rather than spend more than income).

Great post... Which because of the distasteful use of logic, intelligence and facts will be conviniently ignored by the "OMG teh Tory government is teh ebil" brigade

 

[Tummy]

I'd have thought there would be more going to be honest. I guess the recent protests with students and problems would put people off though.

 

[Slam62]

*sigh* no, it was an analogy. Are you capable of reading something out of a literal context?

Point being that if you legislate to allow people to crash the system, they will do so if the end result is gain for them. And by and large, it was gain for them.

yeah well the tories have been argueing for years for greater deregulation, deregulation is a good thing as Cameron is now trying to do so for SMEs, however with deregulation and freedom comes responsibility.

So the point being that you are suggesting paralysing the whole economy through regulation.

 

[Slam62]

Great post... Which because of the distasteful use of logic, intelligence and facts will be conviniently ignored by the "OMG teh Tory government is teh ebil" brigade

well no because point 2 is complete rubbish, all you end up with is high unemployment and a bigger deficit. Not that there is any other choice.

 

[Duke]

haha! No I am going, I'd rather not turn this in to a political debate

Because you're wrong?

 

[Kemik]

yeah well the tories have been argueing for years for greater deregulation, deregulation is a good thing as Cameron is now trying to do so for SMEs, however with deregulation and freedom comes responsibility.

So the point being that you are suggesting paralysing the whole economy through regulation.

I wasn't suggesting anything. I definitely wasn't suggesting total regulation. None of my posts have been political, simply economical.

In my opinion, areas which are vital to the economy do require a certain level of active regulation, rather than box ticking. While regulation would add cost to the products (inefficiencies) it's the price to pay in the perfect capitalist market.

 

[Kemik]

well no because point 2 is complete rubbish, all you end up with is high unemployment and a bigger deficit. Not that there is any other choice.

Please explain. I actually have evidence to backup my points, ala Hong Kong and basic economics. In the short term there is an increase in unemployment, but you'd be surprised how quickly the incentive of profits brings new companies in to the gap.

 

[PermaBanned]

I'd have thought there would be more going to be honest. I guess the recent protests with students and problems would put people off though.

This is OCUK, don't worry, it's not representative of the general population

 

[badcompany]

Dam tory cuts

 

[Deleted member 66701]

Because you're wrong?

No, because arguing a Socialst viewpoint of tech forum full of stuck up Tories (and the odd screwball Lib Dem) is the quick path to a recipe for a straight jacket and a padded cell.

 

[scorza]

Ah, so now you are saying the only reason for the deficit is because the government purchased shares in ailing banks?

Shares it will shortly re-sell for more than it paid.

Well thats then then, surely, the problem will be solved when the shares are re-sold.

Well, that or as per usual you are so wound up in your own 'I hate the fact other people made something in life whereas I didn't' anti corporation rubbish you've no real idea what you are talking about.

Not this AGAIN... It will be years before, possibly a decade or more before the shares will be worth more than the break-even points. Also the bailout was a lot more than the direct loans-for-shares injection to RBS and HBOS - the last estimate it has cost the country £1.5 trillion in insurance, liabilities etc. Not to mention the drop in tax revenue caused by the subsequent global economic recession. So no, "dur hur sell the shares", won't be enough to put right the enormous mess world economies find themselves in.

 

[Kemik]

Not this AGAIN... It will be years before, possibly a decade or more before the shares will be worth more than the break-even points. Also the bailout was a lot more than the direct loans-for-shares injection to RBS and HBOS - the last estimate it has cost the country £1.5 trillion in insurance, liabilities etc. Not to mention the drop in tax revenue caused by the subsequent global economic recession. So no, "dur hur sell the shares", won't be enough to put right the enormous mess world economies find themselves in.

What do you think would have happened if the Government hadn't stepped in? It would have crippled the economy!

It definitely won't be decades before the shares are worth more than the BE point for the Government. Where did you get that figure from?

Are you also saying the bail out of the banks directly caused the recession?

I personally think the government shouldn't have stole (that's what they've done) the Northern Rock shares from shareholders. There have been reports that Virgin were willing to buy them for a higher price than the Nil that the Government acquired them for.