people forget what life would be like without them
You mean, like the 13 million people in poverty in the UK would increase more?
http://www.oxfam.org.uk/resources/ukpoverty/povertyfacts.html
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Is Unemployment a "Price Worth Paying"?
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You mean, like the 13 million people in poverty in the UK would increase more?
http://www.oxfam.org.uk/resources/ukpoverty/povertyfacts.htmlPosted 8 months ago # -
At the moment we have Socialism for the bankers, capitalism for everyone else.
Oh the ironing
Posted 8 months ago # -
Dazh: "The problem I think is that people take public services for granted."
....'cos, it's free, innit?
[Lovely afternoon BTW - anyone fancy a ride?]
Posted 8 months ago # -
Given that poverty is defined as a calculation of 60% of median income - do you think that it would be mathematically possible to eradicate poverty in the UK?
Think about that one for a minute...
Posted 8 months ago # -
AT PMQ's last week Ed Milliband asked not one single question about the economy. Not like its anything important. Why not? Because Ed Balls is sat next to him. Its inexcusable
No, it was because Darling's book came out that week.
Posted 8 months ago # -
while people are thinking about that ZU, how do you feel when you learn that...
"Around a quarter of adults live in households where nobody has a high enough income to pay tax" (IFS this week)
...I find that more thought provoking than the definitions/mathematical possibilities
[straight ? BTW - no BIFF intended]
Posted 8 months ago # -
Z11
By the measure that its one hundred and fifty **** billion quid more than total government income
expenditure more than income means debt, borrowing is, be definition, never a "sustainable" financial position, as, sooner or later, you have to pay it back.I explained this to you yesterday (or was it the day before?)
NO, YOU DO NOT PAY IT BACK - it's impossible. Our global economy only works by the creation of debt.
Posted 8 months ago # -
I'm confused now
Posted 8 months ago # -
Greece shows us what happens if you don't have growth.
No. Greece shows what happens when a small agriculturally based country where everyone is getting on quite nicely gets conned into thinking that growth is the answer to everything and that it should borrow loads of money in order to enjoy the same access to consumerist gewgaws as its "rich" neighbours.
Posted 8 months ago # -
No. Greece shows what happens when a small agriculturally based country where everyone is getting on quite nicely gets conned into thinking that growth is the answer to everything and that it should borrow loads of money in order to enjoy the same access to consumerist gewgaws as its "rich" neighbours
.............. Lies about it's finances and allows mass tax evasion
Posted 8 months ago # -
If you've got 38 minutes you might want to have a look at this:
I think he talks a lot of sense.
(if you can get over the production values of the video)
Posted 8 months ago # -
Binners banks lend money out [ they dont really have*] and it works as long as everyone believes everyone will pay everyone back and savers dont ask for their money back. Once this stops being believable and people panic and ask for their money back or stop paying it crashes like this.
When it crashes like this we blame the public sector for crippling us and talk about how only capitalism can save us.
The logic of all of this is lost on me mind but thats the story.Posted 8 months ago # -
RPRT - is the stuff you are smoking legal?
Posted 8 months ago # -
Isn't Greece actually just an example of people wanting good public services etc, while not wanting to pay any tax?
They all retire when they're 50 and tax evasion is endemic at every level of society. And now they're getting uppity because the Germans don't want to pay for it
Posted 8 months ago # -
THM,
What's your point?
Quite happy to debate ad infinitum, but I'll go elsewhere for comedy if you don't mind.
Posted 8 months ago # -
Binners banks lend money out [ they dont really have*] and it works as long as everyone believes everyone will pay everyone back and savers dont ask for their money back. Once this stops being believable and people panic and ask for their money back or stop paying it crashes like this.
A Ponzi scheme?
Posted 8 months ago # -
Isn't Greece actually just an example of people wanting good public services etc, while not wanting to pay any tax?
Or more akin to the US subprime situation?
Maybe they shouldn't have been allowed to borrow loads of money?
Posted 8 months ago # -
Didn't I read somewhere during the crash that Goldman Sachs had been helping the Greek government keep their debt off the balance sheet?
Hang on a mo......
Posted 8 months ago # -
It'd be cheaper in the long run to cut Greece loose
Posted 8 months ago # -
It does make you wonder how much longer they can keep pouring cash down the money pit? All the stuff I've read seems to suggest its a case of 'when' rather than 'if' Greece defaults
Posted 8 months ago # -
JY - Of course, banks lend money that they do not have. That is their function - to intermediate between those that have excess savings (eg depositors) and those that have a deficit (borrowers). So their liabilities are capital (owned by shareholders), deposits (owned by those with excess savings) and other investors who provide debt. The reason why these are "liabilities" is of course that they need to be paid back. On the other side of the balance sheet are the assets - cash, loans, investments and a tiny % of fixed assets.
This role combined with the inherent leverage in their business model means that they are also a highly geared reflection of what is going on in society. Of course, the current reforms are trying to make them less geared. Banking then becomes a business of analysing, pricing, taking and managing risk. It was always thus and will remain so.
I do not believe the chain of thought you describe though. I have not read anywhere an analysis that says that the banking crisis was the fault of the public sector crippling us. It has multiple, inter-related factors but this is probably one too far.
Instead we are in the middle of an ongoing crises with different epi-centres and different causes. It started with a crisis at the household level, specifically those people who have historically found it difficult to afford housing, became a banking problem and has now moved to be a sovereign problem. It is because of this that attention moved from the ability of individuals to repay, then banks, then countries. As part of that trend, focus shifts to the question on whether the deficits being run at the country level are sustainable or not. Hence, the issue of the costs of public sector (including pensions) become part of the analysis.
Posted 8 months ago # -
banks lend money out [ they dont really have*] and it works as long as everyone believes everyone will pay everyone back and savers dont ask for their money back. Once this stops being believable and people panic and ask for their money back or stop paying it crashes like this.
A very nice and concise description of the capitalist financial system. And yes, also a nice and concise description of a classic Ponzi scheme. God help us all when it all comes crashing down.
Posted 8 months ago # -
JY - Of course, banks lend money that they do not have. That is their function - to intermediate between those that have excess savings (eg depositors) and those that have a deficit (borrowers).
You seem to have missed out any mention of "fractional-reserve banking". You know, the bit that means banks really can lend money that doesn't even exist.. It is quite important.
Posted 8 months ago # -
God help us all when it all comes crashing down.
It did - and the next phase is still to come.
Posted 8 months ago # -
..If you've got 38 minutes you might want to have a look at this:
I like this one...
Posted 8 months ago # -
RPRT - you are correct, there are lots of things I left out including things that banks do wrong..
Binners, you are correct on both counts. Its rather like certain institutions that derived large amount of their returns from helping companies to avoid UK taxation, later benefitting from UK taxpayers support.
Posted 8 months ago # -
It did - and the next phase is still to come.
Well not quite. They managed to stuff a load more money into it to just about keep it afloat. I often wonder whether it wouldn't just be better to reset all the databases, create a load of new money and share it out again. It'd be like the matrix!
Posted 8 months ago # -
I do not believe the chain of thought you describe though. I have not read anywhere an analysis that says that the banking crisis was the fault of the public sector crippling us
it was sarcasm about who some seem to blame for the current scenario. State size is a political/philosophical point rather than an economic one tbh.Posted 8 months ago # -
THM
But JY made a fairly clear point that banks lend money they don't have.
You then went on to say that you agreed with him, but giving the misleading (your favourite word) impression, but alas the one that most people seem to have, that banks merely take money from depositors and then lend it out, when of course that is nothing like what they do.
Posted 8 months ago # -
OK RPRT - for sure, that is a simplification. The point being was merely to show that banks do not own the money they lend. Blimey getting on to fractional reserve banking was not something that i expected on STW.
But it is a very valid question and point. Made all the more interesting in that some of the most heated critics of the concept are actually the libertarian free marketers in Austria. There has to be some irony there.
I wonder how you would sell the concept of 100% reserve banking to Vince Cable. Ok, time for a quick ride to try and think of the answer. Thanks for the idea RPRT - apart from the aggro, there is always something that I get form your posts!! Just not sure about the Greece analysis.
Posted 8 months ago # -
all i will say is dont mention Elton John..he did once and nearly got away with it
Posted 8 months ago # -
THM
But JY made a fairly clear point that banks lend money they don't have.
You then went on to say that you agreed with him, but giving the misleading (your favourite word) impression, but alas the one that most people seem to have, that banks merely take money from depositors and then lend it out, when of course that is nothing like what they do.
Of course banks lend money they don't have, that's the point? Is that bad, or is it just something you don't understand and therefore feel is dangerous?
Fractional reserve banking conspiracies have replaced 9/11 conspiracies as far as I can tell.
Posted 8 months ago # -
So RPRT - the Martenson analysis is interesting and clearly put. I can't see anything particularly controversial here though. What are your key take aways from it?
Posted 8 months ago # -
Fractional reserve banking conspiracies have replaced 9/11 conspiracies as far as I can tell.
It fits in nicely with Illuminati/Vatican/Jewish banker conspiracy theory. This time, though, it's being given a megaphone by companies selling dodgy "collector" gold - see the links between Glenn Beck and mail order gold companies.Posted 8 months ago # -
bainbridge,
Like many things, it's bad in excess. And that is what we have had - runaway creation of money as debt. And now we're in the sh1t.
Konabunny,
Please don't try to lump fractional reserve banking in with all that other stuff. It is part of mainstream economics and its use/abuse has led to many of our current economic problems. You will find plenty of mainstream economists saying so.
THM,
The key "take away" (or point, as I prefer to term it) is that the economics that have "worked" since the war won't work anymore as we reach the limits of population growth and resources such as agricultural land, fresh water, fish, timber etc.
Posted 8 months ago #
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