[Closed] Double dip recession

F*** it, let's do it.

Well we have a banker's dictatorship - won't that do ?

[i]"As a minister, I experienced the power of industrialists and bankers to get their way by use of the crudest form of economic pressure, even blackmail, against a Labour Government. Compared to this, the pressure brought to bear in industrial disputes is minuscule. This power was revealed even more clearly in 1976 when the IMF secured cuts in our public expenditure. These lessons led me to the conclusion that the UK is only superficially governed by MPs and the voters who elect them. Parliamentary democracy is, in truth, little more than a means of securing a periodical change in the management team, which is then allowed to preside over a system that remains in essence intact. If the British people were ever to ask themselves what power they truly enjoyed under our political system they would be amazed to discover how little it is, and some new Chartist agitation might be born and might quickly gather momentum"[/i]

T. Benn

ernie_lynch - Member
I think you'll find that economics is politics in its purest form, so divorcing the two would be problematic.

Has it ever been divorced?

I understand what you're saying but is that because of politicians approaching economists with a 'we want this, please work out a model for us'/economists looking for economic answers to political questions rather than starting with a 'what would be the most sustainable way to run an economy'?

Guess it comes back to what kaesae (sp?) was saying earlier with regards to (what I understood to be) a resource based economy.

But could one country run a resource based economy? Surely it would take every country working in 'I'd like to teach the world to sing' harmony to achieve this?

It is because the only power that matters is economic power. If the government doesn't have economic power then it doesn't have power.

Dictatorship

TJ in charge, that ok with everyone?

.

that ok with everyone?

I'm not sure whether you've quite got the hang of this dictatorship malarkey.

😀 @ Ernie!

It's what I like to call consultative dictatorship, it's the way forward IMO.

Ernie, that's the best post of the thread. But shouldn't it have been on the jokes page. On a par with the best of them

They TB quote was interesting, but surprised that neither he nor anyone else mention the civil servants. How much power does the W'hall apparatus yield behind the scenes?

kimbers - Member

building some new council houses- kil 2 birds with one redbrick?

ernie_lynch - Member
F*** it, let's do it.
Well we have a banker's dictatorship - won't that do ?

"As a minister, I experienced the power of industrialists and bankers to get their way by use of the crudest form of economic pressure, even blackmail, against a Labour Government. Compared to this, the pressure brought to bear in industrial disputes is minuscule. This power was revealed even more clearly in 1976 when the IMF secured cuts in our public expenditure. These lessons led me to the conclusion that the UK is only superficially governed by MPs and the voters who elect them. Parliamentary democracy is, in truth, little more than a means of securing a periodical change in the management team, which is then allowed to preside over a system that remains in essence intact. If the British people were ever to ask themselves what power they truly enjoyed under our political system they would be amazed to discover how little it is, and some new Chartist agitation might be born and might quickly gather momentum"

T. Benn

This.

So how to end it?

It's fairly simple, and i think do able if I still had that youthful fire of enthusiasm.

Basically what is needed is an egalitarian call to arms, not necessarily a 'bloody revolution' but certainly a revolt against the current system.

The weapon a seriously organised group called use?

Tax Strike.

'They couldn't jail all of us'

So if all the tax paying individuals could come together and demand a different system, a system where the politico's have to have had some experience in the real world before they become politico's, a sensible citizens charter of rights and responsibilities, maybe even a proper constitution.
A value scale of a mans worth, a day of his labour, a scale of when enough to live forever without working anymore, is enough and excess is not necessary at the detriment of others.
The level of profit that may be extracted from the proletariat by those that would supply essential services.

Etc etc, I'm sure a set of aspirations could be drawn up, a political movement established with the ultimate threat of withdrawal of funding for the current bunch if they do not accede to the demands, or of course a party could be formed an election fought in the old style but I doubt it would be as effective.

Just to give some balance from quoting a Labour Party sympathiser, today the Telegraph delivers much the same message:

[b]None the less, the significance of a double dip is more political than economic.[/b] Even if the GDP had grown a little, depriving Mr Balls of this moment of triumph, it wouldn’t have changed the big picture, which is of an economy deeply impaired by a continuing banking crisis. The gap between 0.1 per cent growth and a 0.2 per cent contraction is too small to be of anything more than symbolic importance....

[b]The all-too-depressing reality of this downturn is that there are no quick fixes. [/b]If the Chancellor made a [b]mistake, it was in believing that the mere act of deficit reduction would rekindle growth.[/b] This was never very likely with everyone else – households, banks and major export markets in the eurozone and beyond – all deleveraging at one and the same time. [b]But this doesn’t mean that the strategy is wrong.[/b]

An overblown banking sector makes Britain particularly vulnerable to the sort of sovereign debt and financial market contagion we have seen sweep the eurozone. To engage in further fiscal stimulus at a time when the Government is already adding to the national debt at the rate of about 10 per cent of GDP a year would be to take extreme risks with interest rates. Any significant rise in the cost of money for a country as indebted as Britain would be catastrophic.

[b]The differences between Labour and the Coalition on macro-economic policy are in any case more about rhetoric than substance. [/b]Continued economic contraction has caused the automatic stabilisers to kick in, slowing the pace of deficit reduction to one that is actually not so very different to that planned by Labour before it lost power. [b]In a way, the Government is already doing what Labour demands, [/b]to the dismay of those who thought a Tory-led administration would match words with actions in pursuit of a smaller state. The automatic stabilisers of welfare spending would in many other countries, including the US, be counted as a discretionary fiscal stimulus.

It has long seemed to me that the Government has got the broad outline of the consolidation about right – just enough to keep the markets sweet, but not so big that it causes a vicious cycle of decline in the economy. [b]Yet whether it is right about the composition of deficit reduction is much more questionable.[/b]

[i]anagallis_arvensis - Member

But I welcome the change of course you have taken there.

wrote the same thing about five pages back actually.
[/i]

That wasn't what I was referring to.
🙄

Anyway, Excellent !.
The bickering, it would seem, knows no end.
I am not amazed.
Are we getting anywhere ?.
Should I forward this thread to the Treasury, in order to enlighten them ?.
Don't any of us have bikes to ride, clean, maintain ?.
😀

Here !
[img] [/img]

[i]the significance of a double dip[/i]

Is that there isn't one.

How can you have a [i]double dip[/i] recession ?.

You've all been duped, again, by the popular media.

Contraction, is, err, contraction.
Eventually, contraction stops.
It stops when we have growth.
If, at some later point, growth stops and we have contraction.
Thats not a double dip is it.
😆

It is because the only power that matters is economic power.

If the government doesn't have economic power then it doesn't have power.

How can we expect to have exponential growth? Everything has to contract some time, the illusion of endless growth hides the truth - it's a requirement to keep the current economic framework together and is only possible because of borrowing and inflation. Inflation is theft.

tonyd: well spoken.

The significance is not the "double dip". When your bumping along the bottom there will be little ups and little downs, -0.2% is not the end of the world.
The significance is the -3% in a key economic leading indicator, the construction sector.
If the Office for National Statistics is accurate, and why would they be wrong this time, then expect things to get much worse this year.

How can we expect to have exponential growth? Everything has to contract some time

We all know this. But somehow [s]the morons[/s] our lords and masters have managed to base the entire global financial system on the assumption that it is. Great!

Actually, everyone knows it can't go on for ever, but people can continue to make money out of it whilst it is going on.

With the dotcom boom, analysts kept saying 'why did no-one see this coming?' Everyone knew it was coming, but people were keeping it going as long as possible so they could keep converting artificially created money into real money in their own bank accounts.

However this is a little more fundamental. People are already beginning to wonder when they will have to change tack and start investing in alternatives.

I agree that those in the know want to keep the plates spinning to get that last few quid, or to pull money out before it hits the fan. Twas ever thus.

My problem is that it's the 'ordinary' folk who are spoon fed nonsense by the politicians and main stream media that are left in that Wile E Coyote predicament - still running when the ground has disappeared from under them. It's these people that get affected the most, and they're the ones that can least afford it.

I know we are all ultimately responsible for our own actions but not everyone has the time to understand what is happening (or wants to face the truth of it). If only someone in the public eye had the fortitude to stop lying and stand up and tell us how it really is - the party is over and now it's time to take the pain. The sooner we take that pain and readjust the sooner we can recover and rebuild.

How can we expect to have exponential growth? Everything has to contract some time

We all know this. But somehow the morons our lords and masters have managed to base the entire global financial system on the assumption that it is. Great!

Don't worry - the google guys are going to get stuff from asteroids!

GDP can keep increasing. Back to business as usual. Carry on.

Tonyd: amen, again.

I know we are all ultimately responsible for our own actions but not everyone has the time to understand what is happening (or wants to face the truth of it). If only someone in the public eye had the fortitude to stop lying and stand up and tell us how it really is - the party is over and now it's time to take the pain. The sooner we take that pain and readjust the sooner we can recover and rebuild.

Ultimately I agree with most of this, except.... The people taking the pain are those who were least at fault, and those can can least afford it, while those at the top continue on their merry way with no pain whatsoever. If we were talking about everyone having to readjust lifestyles etc I'd be right there with you.

The fact is there is still lots of money floating around, but more and more of it is in the hands of an ever shrinking group of people.

Could be that one of the biggest problems is the proliferation of virtual money. If I sell my house and buy another, larger house and take out a bigger mortgage, then the person that buys my house transfers money from his lender to my lender and I transfer money from mylender for my new house, no "real" cash changes hands and this process pyramids onwards and upwards. As long as everyone in the chain plays the game and keeps making the payments, then it's happy days. The trouble is when the links start to break up the whole thing falls apart and people start looking round for the "real" money that never existed in the first place.

Good point & people like me are waiting for that to happen so I could maybe actually afford a house.

There is such a massive vested interest from the majority in keeping house prices up, whatever it takes.

oooooo: We probably frequent other forums. HPC?

pyramids

grum - I'm with you, which is why I said earlier that it's those that can least afford it that get hit the hardest. For those lucky enough to be in the right place the gravy train continues, but for the vast majority of us the sooner the profligacy ends and we cut our cloth accordingly the better.

As for houses, don't get me started. We've been trying to find something reasonably priced for 3 years now, unfortunately we live in one of the more affluent areas of the country. Folk round here refuse to accept that things aren't what they were and still expect the same paper profit they thought they had 5 years ago. Some sell, a lot don't.

Edit: I lurk at HPC 🙂

Housing sums up why the notion of a quick recovery is flawed.

Mortgages on paper look cheap - the Halifax Mortgage Earnings Ratio is well below the 83-12 average in all regions and at a minimum in Scotland. But can you actually get the mortgage in the first place?

House prices on the other hand remain above the same average in all regions except Scotland. The housing market is not working properly. Supply seems still to be limited and therefore prices remain too high.

Another reason why and overreliance on QE is an error.

http://www.lloydsbankinggroup.com/media1/economic_insight/halifax_house_price_index_page.asp

What's HPC Matt? I definitely don't post there 🙂

HPC = [url= http://www.housepricecrash.co.uk/ ]House Price Crash[/url]

Very informative and active forum. As with most places there are some loons, but there is also a lot of very good commentary and analysis. Recommended reading if you're a bit disillusioned with the cost of housing and state of the economy in general.

Well none solution to this might be to build infrastructure - perhaps council houses - jobs in construction, money into the economy, something concrete at the end of it.

Rather better than paying people to sit around doing nowt, could even have some apprenticeships as well.

WE might as well get something concrete for the money rather than paying people to sit around doing nowt.

id call my self a socialist tory. clearly the coalitions plan has nt worked how they would have liked.. but which country is booming in europe? where is the share price up inflation at 2.5 of less and growth of 3-5%? where has not had to make cuts reduce spending?
which countries have carried on spending the way they were or even increased?
i dont see a ''viable alternative way'' if i was borrowing 25% of what i was spending each week i'd have to stop spending at some point it seems simple to me.
as for a double dip recession.. in rochdale were still on the way down on the first one 0.1% 0.3% makes NO difference either way to me or mine or thousands locally
practically for me things cost more esp. fuel of all types the shopping costs more. my income is static mrs tts income is static (for 3 years now and two more predicted)
so we ve done what i assume everyone has done .. reduced spending paid off debts hunker down till the storm blows over. i cant see anyone whose spending more and borrowing more to pay for it.

id call my self a socialist tory. clearly the coalitions plan has nt worked how they would have liked.. but which country is booming in europe?

I'm not sure why you think the coalition plans have "not worked how they would have liked". There was always an extremely high risk that the UK would experience a so-called "double-dip" recession - a whole broad spectrum of people predicted that precisely this would happen, and Cameron and Osborne aren't exactly what you could describe as "stupid", no matter how much anyone might disagree with them.

I think the coalition strategy (at least the Tory's strategy - let's face it they are the ones calling all the shots) is very much going to plan. Had the UK not gone into a double-dip recession (with a lot of luck that might have been possible) then that simply would have been a huge bonus. But shrinking 0.02% or growing 0.01% has minimal effect, apart from the significance of newspaper headlines.

As far as which country in Europe is booming is concerned, well you have to see it in the context that out of the 27 EU countries, for example, 24 of them have conservative governments, so you can expect them all to follow very simular economic policies. There are countries in the world who's economies are "booming" but you generally need to look beyond Europe. Although Europe does provide some stunning examples of how austerity doesn't work.

ernie_lynch - Member
There was always an extremely high risk that the UK would experience a so-called "double-dip" recession - [b]a whole broad spectrum of people predicted that precisely this would happen,[/b] and Cameron and Osborne aren't exactly what you could describe as "stupid", no matter how much anyone might disagree with them.

...I guess we should count the OBR out in terms of this broad spectrum of people (oh, and the BoE!). Economic forecasting is a perilous occupation at the best of times but the new and the old here have hardly covered themselves in forecasting glory. Still they can join big-hitters like Roubini!! 😉 (although not get paid like him!]

If I tossed a coin and asked the media to comment on it, 50% of them would write about how great they are and how they saw heads coming but none of the tailers listened to them...

Oh dear, the news from Spain puts yet another nail in the coffin of a speedy recovery. Without an attempt at an orderly re-alignment of FX rates into a 2 or 3 speed Europe I fail to see how the outlook can improve.

24% UN and 52% for the <25 years - leaving aside Spain's structural issues, how can locking yourself into an uncompetitive exchange rate help? How terrible for the youth of Spain.

24% UN and 52% for the <25 years - leaving aside Spain's structural issues, how can locking yourself into an uncompetitive exchange rate help? How terrible for the youth of Spain.

Except the figures are bollocks. There's a huge undeclared economy here, there's nowhere near 24% unemployment.

Still high enough, of course, but it's nothing like as high as the official figures.

Oh look

Usa, Germany. UK all followed similar policies until the tories got in when no more stimulus only cuts applied by the tories

read the graph and weep

[img] [/img]
http://www.guardian.co.uk/business/2012/apr/25/uk-sinks-double-dip-recession-gdp

~countries that are following sensible mixed policies are doing far better than we are - the tories only success is in persuading folk that the cuts are right - they are clearly wrong. Just look at the date the graphs diverge

MOlgips - read my history - i predicted this 18 months ago - it was that obvious that a nurse with no economic training but a smattering of sense could see it was going to happen. tory supporters - you have been conned

teamhurtmore - Member

I fail to see how the outlook can improve.

Open your eyes to the alternative to the Tory cuts - open your mind.

yes you fail to see it because you are wedded to the tory austerity agenda and you believe as axioms the assumptions backing this.

Economic stimulus is required. construction sector mainly. Lets build houses.
fur hunnere 🙂

The poor see inflation lowering their living standards.

Those who benefit £220 a year under the new tax system still see lowered living standards because of inflation.

But the rich, the bankers, those whose tax rate is dropping from 50% to 45%, they are going to benefit by an average of £240,00 a year.

No recession for them!

TandemJeremy - Member

Is here

As predicted by everyone bar tory apologists the financial incompetents now running he country have pushed us back into recession.

So obvious this was going to happen. shows how incompetent they are.

Crikey TJ ... talking about "unbias" comments ... Do you expect someone to turn the country around in 2 years? Have you been smoking something?

TJ, to be frank there is only one person that can turn the economy around ... yes, you guess it ... it is your worship the Dear Leader. Dear Leader can enforce collective farming, collective living, collective hard labour for you lot ... Dear Leader will appoint you, TJ, as the labour force driver and bestow you with power so immense you become god like. You can punish them or educate them in your image.

🙄

Do you expect someone to turn the country around in 2 years?

Well the last government got Britain out of recession in 2 years.

And this present government confidently predicted that public sector job cuts would be absorbed by a booming private sector - what happened ?

Even only last month they were claiming that everything was going to plan :

[url= http://www.thisislocallondon.co.uk/uk_national_news/9603606.Upbeat_Osborne_predicts_more_growth/ ]Upbeat Osborne predicts more growth[/url]

Despite the fact that nothing appears to have been going to plan from the start. Apart from the wealthy getting wealthier of course.

Was Britain still in recession when the last government took over?

No, nor was Britain in recession when this government took over. What's your point caller.....that the last government caused the global recession ? 🙂