[Closed] Osbourne says no to currency union.

Jesus H Christ - defaulting on what?

Yes, but i bet those patients who do what you advise them do a lot better than the ones who dont.

No, not at all. The ones that don't do what I advise them tend to be self motivated, listen to their own body and go back to their own way of doing things really quickly - they seldom have problems that they need to come back and see me for.

Well your side disagree with you. They know they have to make a compensation for the benefits received. The only debate is the timing and the method. Currency has nothing to do with it. It is a smokescreen.

Scotland can technically default and in the eyes of the market this is clear. AS can fool the electorate but he won't fool the people who will be leading him the money, They understand this stuff.

Sorry that you are still failing to understand. I must have explained it badly. 17-18 year old students get it though. - it's not that hard.

it has certainly cleared up a few outstanding queries...

If only! There is only one slight of hand here and that belongs unsurprisingly to the fIrst minister. Heaven forbid he is let loose on the wider world.

Please go and read what the fiscal commision says - there is no argument that an iS will "service a fair and equatable share" of the debt that currently exists. It's merely the timing and the means that need to be discussed.

They know they have to make a compensation for the benefits received.

Ok - I'll try asking you the same question in a different way.

How can Scotland default on a debt which a foreign country is solely liable for?

How many times can that question be answered without any resulting comprehension?
I get it, and I'm just a bloody machinist.

By failing to (in the FS own words) service its fair share. Just because it cannot be spilt does not mean that there is no liability.

Anyway, it will leave it there because you must be simply taking the piss now.

P.s. Its past benefits not just future ones.

there is no argument that an iS will "service a fair and equatable share" of the debt that currently exists.

Correct. It's the fair and equitable bit that is important. Taking on liabilities without assets is neither fair nor equitable. Nobody is disputing the fact that Scotland will take on a fair and equitable share. What is being stated quite clearly on many occasions is that Scotland will not be taking on an unfair and inequitable share of the pot - we wouldn't expect rUK to do that either.

muddydwarf - you explain it to me then.

Wanman - THM has explained it in simple terms several times, if you can't grasp the salient points when an economist lays them out then why do you think anyone else can ram it home?

The term 'technical default' is simply a device by which the market understands that a Country has made itself a high risk, poor market for investment & that those financial markets will reflect that view of the Country.
Whilst the Country may not have actually welched on a debt, it is seen to have gone back on its agreement to service a financial obligation & therefore investors will be extremely wary of investing in that Country.

That's what i have taken from THM's answers, i cannot see why you would not be able to grasp the same.

I know fine well what a technical default is - thanks for repeating that.

The bit that I do not get is how can a country default on a debt that it is not liable for? rUK has after all said that it would be liable for all UK debts post independence. Can you explain that point specifically, because nobody else appears to be able to do so.

Wanman, you are obviously not going to believe us. Go and read what the FC says, it's broadly the same thing (albeit it with a slight spin). You know where to find it, just read it instead of blindly posting it. It really is not that difficult to understand - unless you spend too much time listening to the Deceitful One. Admittedly he makes it (deliberately) very confusing.

It's a simple enough question that I'm asking.

I'll change it again to make it simpler if you want. Say I live with my mother, she takes out a loan in her name only and gives some of the money to me with the expectation from her that I will contribute to it, I then move out she sells all my stuff, so I stop giving her any money - can I be in a technical default on the loan she took out? If so, how?

Yeah, but you're ****ed when you try and join the social club and she gets to veto your membership 😆

Because, saying 'if you don't give us a currency union then we'll refuse to pay the part of the National Debt we incurred' will be seen as a technical default by the markets, that's not a healthy position for a newly-minted Nation to be in.
Scotland may not have inherited an actual, physical debt, but by refusing to contribute to the debt of the rUK it will be seen by investors to be untrustworthy. THAT is the problem, call it a technical default, call it untrustworthy, call it whatever you like but the end result will be a very painful emergence into the Capital markets for such a Country.
You know this very well, you are just being deliberately obtuse.

Two neighbours want to buy a flash car and are with the intention of sharing it on a 90/10 basis.

They can't afford to buy outright so take out a 100% loan in the 90% partners name because they're such good mates, and don't expect anything to get in the way of that friendship for the length of the loan. They pay their respective share each month, the bank is happy, they play with their car and all is well in the world. 🙂

They have a bit of a tiff and the 10% guy runs off with 10% of the car and refuses to meet the remainder of his obliged payments. The 90% partner can scrape together the cash to replace the missing bits and pay all the loan on his own. The loan doesn't default.

Unfortunately the bank manager lives next door and can see all this playing out, and Mr 10% needs a huge loan to pay for the big extension he's promised his wife and kids.

Mr bank manager places a very high value on people fulfilling their obligations no matter if technical or otherwise, so tells Mr 10% he can either **** off or pay an eye watering amount of interest on the money.

Mr 10% has now made his life very difficult and his wife and kids pay the price.

Mr 90% would have been happy for Mr 10% to keep the parts and pay the outstanding portion of the 10% as a lump sum or monthly, Mr 10% would be looked at much for favourably by the bank manager to get a better rate on his loan.

Pretty simple I thought! It's not so much the point of paying the loan that's the issue, its that the bank manager can see you're being an arse about it and will make getting credit that you must have more expensive.

[quote=muddydwarf ]Because, saying 'if you don't give us a currency union then we'll refuse to pay the part of the National Debt we incurred' will be seen as a technical default by the markets, that's not a healthy position for a newly-minted Nation to be in.
Scotland may not have inherited an actual, physical debt, but by refusing to contribute to the debt of the rUK it will be seen by investors to be untrustworthy.Surely it will only be deemed untrustworthy if there is no good reason for [i]not[/i] contributing? If the reason is that iScotland wasn't given a fair share of the assets then no one would expect them to contribute all of their part of the historic debt. Quid pro quo and all that.

Very that analogy try again.

Now in a Free Yorkshire tha'd pay Nowt for owt.

Was you born in Englanfshire

Edit, spelling, to much Pure North

They have a bit of a tiff and the 10% guy runs off with 10% of the car and refuses to meet the remainder of his obliged payments.

Bingo - that's why it's not a technical default because we'd be leaving that 10% of the car behind. We'd stop paying for our part of the loan, but we'd not be taking 10% of the car. Mr 90% can't afford the repayments for 90% of the car - maybe he should do his best to keep on good terms with Mr 10% so that he can afford to make the repayments.

Or a different way of putting it - it's totally different because Mr 90% has used his size and weight to try and bully poor wee stupid Mr 10% into leaving the 10% of the car behind. Not really fair to ask Mr 10% to continue to pay if he has no access to the car now is it?

Surely it will only be deemed untrustworthy if there is no good reason for not contributing? If the reason is that iScotland wasn't given a fair share of the assets then no one would expect them to contribute all of their part of the historic debt. Quid pro quo and all that.

Seems a reasonable position, but you are gambling that the people you want to lend you the money have the same definition of 'good reason'.
THM and others seem to be suggesting that the people with all the money to lend won't agree with your definition of an asset.

Scotroutes - i agree, and i doubt Scotland will NOT get a decent and fair shair of the assets.
But the Currency Union isn't on the table, no matter how the SNP/Yes Scotland posture and bluster, threatening not to pay towards that debt, it will not happen due to the extremely strong public views on it in the rest of the UK.
No one really wants to deny Scotland a fair share of assets but we aren't going to risk our pensions etc to prop up what will be a competitor State.
You wouldn't do it, why should you expect us to do so?

Wanmankylung, what you appear to be unable to digest is the fact that Scotland would be incredibly weak in the post yes negotiations, she wants a great deal from the rUK. The most fundamental and looming thing is that iScotland wants HMRC to continue collecting its taxes (indeed it doesn't even have its own database of taxpayers, assets, land registration etc) Without being able to collect taxes any modern country would quickly fall apart.

An independent Scotland, in the hypothetical situation we're discussing of defaulting (technically, morally or otherwise) on the debt, even if it was allowed independence (which remains in the gift of the UK parliament) could end up with no assets apart from those fixed in Scotland, no transitional services from UK institutions, an angry southern neighbour (with a Veto on it's EU membership) and a very bad image to the international markets.

If you think that situation is a bargain then fair enough, but from my perspective it would cripple iScotland from the outset.

ninfan - Member
Wanmankylung, what you appear to be unable to digest is the fact that Scotland would be incredibly weak in the post yes negotiations, she wants a great deal from the rUK. The most fundamental and looming thing is that iScotland wants HMRC to continue collecting its taxes (indeed it doesn't even have its own database of taxpayers, assets, land registration etc) Without being able to collect taxes any modern country would quickly fall apart.

An independent Scotland, in the hypothetical situation we're discussing of defaulting (technically, morally or otherwise) on the debt could end up with no assets apart from those fixed in Scotland, no transitional services from UK institutions, an angry southern neighbour (with a Veto on it's EU membership) and a very bad image to the international markets.

If you think that situation is a bargain then fair enough, but from my perspective it would cripple iScotland from the outset.

The negotiations would be based upon a whole pile of things. Debt and currency would only be two of those.

rUK's position is no on currency. Scotlands position may be no to debt. There may be many other things which would need to be negotiated. You have to look at the bigger picture.

Dont overlook the cost of setting up Scotlands version of the HMRC, DVLA, Passport agency, Highways agency, etc... which wont be cheap. In order to fund this either Scotland will have to borrow from the financial markets (and its going to need a central bank to do so) or come to some compromise with rUK over a settlement figure.

Do Scots really think the rUK would let them get away with not paying any of the debt? After independence they will be told what to pay and then they will do it. They will not all of a sudden gain the ability to stand up to the English. After all they have just spent the last 300 years having everything done for them by us, it takes time to learn to stand on your own two feet boys.

[quote=whimbrel ]
THM and others seem to be suggesting that the people with all the money to lend won't agree with your definition of an asset.
Oh well, if THM says that's true then it must be 😆

Seosamh77 - which part precisely would you like to take issue with ?

Is it my opinion that Scotland needs HMRC to continue collecting its taxes? It even says it in the White Paper

[i]There will be a transition phase after independence where, by agreement with HM Revenue & Customs, taxes would continue to be collected through existing HMRC systems.[/i]

😀

Under your anology Wanman, who does the bank manager blame and who will he be v reluctant to lend to again. Simple isn't it?

Wanman, I suspect a multi here?!?

Oh well, if THM says that's true then it must be

Glad, you are getting it.

Ninfan, quoting yS/FC stuff back to nats is clearly a waste of time. Just go back to the nice wee currency option graphic a few pages back and spot the missing option. The one that NW was trying to suggest (even more pages back)was given real consideration is conspicuous by its omission. Funny that.

See no evil etc......

fasternotfatter - Member
Do Scots really think the rUK would let them get away with not paying any of the debt? After independence they will be told what to pay and then they will do it. They will not all of a sudden gain the ability to stand up to the English. After all they have just spent the last 300 years having everything done for them by us, it takes time to learn to stand on your own two feet boys.

but we'd not be taking 10% of the car

It's not a perfect analogy by any stretch, I could have used 2 fat people taking out a lone to buy a huge cake that they eat up front. That would have been better.

The cash has already been spent on an asset that has been irretrievably consumed, and the liability for furnishing the debt remains.

You could argue that the bank manager was a fool for allowing a loan to buy a big cake, but if they'll pay an acceptable rate of interest and the risk looks good, what the hell!

what you appear to be unable to digest is the fact that Scotland would be incredibly weak in the post yes negotiations, she wants a great deal from the rUK.

I am perfectly capable of judging for myself how strong or otherwise my country would be during negotiations. My opinion differs from your somewhat. Fair and equitable remember....

indeed it doesn't even have its own database of taxpayers, assets, land registration etc

Surely HMRC would be an asset to be shared if things are to be fair and equitable...

no assets apart from those fixed in Scotland, no transitional services from UK institutions

Ooh oooh ooooh - here comes fair and equitable again...

with a Veto on it's EU membership

an angry southern neighbour

[quote=unklebuck ]
The cash has already been spent on an asset that has been irretrievably consumed,
Except that it hasn't and so your analogy falls apart

scotroutes - Member
whimbrel »
THM and others seem to be suggesting that the people with all the money to lend won't agree with your definition of an asset.

Oh well, if THM says that's true then it must be

As I said, it appears to be a gamble.
Interesting times in the event of a Yes.

Under your anology Wanman, who does the bank manager blame and who will he be v reluctant to lend to again. Simple isn't it?

My mother getting a loan analogy? He blames my mother obviously because I've never been into the bank and he may not even know that I exist.

Except that it hasn't and so your analogy falls apart

I was referring to just the cake, to keep it simple.

ninfan - Member
Seosamh77 - which part precisely would you like to take issue with ?

Is it my opinion that Scotland needs HMRC to continue collecting its taxes? It even says it in the White Paper

There will be a transition phase after independence where, by agreement with HM Revenue & Customs, taxes would continue to be collected through existing HMRC systems.

here's another one that thinks the empire still rules the world!

A country with the 6th highest GDP in the world vs a country that will be as relevant on the world stage as the republic of Ireland. You are going to be small for a very long time 🙁

It's not a perfect analogy by any stretch, I could have used 2 fat people taking out a lone to buy a huge cake that they eat up front. That would have been better.

Is the cake loan in the name of one person? Well that person had better play nice with the other one if the dont want to default on their cake loan payments.

My mother getting a loan analogy? He blames my mother obviously because I've never been into the bank and he may not even know that I exist.

But you've said a lot of things on the TV that the bank manager has seen and makes him a bit worried.

Surely HMRC would be an asset to be shared if things are to be fair and equitable...

ah, so you're not [i]actually[/i] leaving behind the car, you want to be able to take the wheels do you 😆

As I said, it appears to be a gamble.
Interesting times in the event of a Yes.

There are so many unknowns around a Yes vote that no one really knows what they are voting for.

It seems like a very big gamble.

[quote=ninfan ]Surely HMRC would be an asset to be shared if things are to be fair and equitable...
ah, so you're actually not leaving behind the car, you want to be able to take the wheels do you Of course. We're even prepared to pay for them.

Where does all this "we have been paying for 10% of everything come from? You have been paying 10% and getting at least 9% back. Don't spend your 1% all at once boys.

That is a very patronising and foolhardy way to view investors.

But I was referring to the 90/10 one but it's the same thing. Is confidence that low that you think investors have never heard of Scotland? I know it's desperate when your man is well and truly caught with his pants down but the level of desperation now being reached is genuinely pathetic for a wonderful place like Scotland. Very sad.

ah, so you're actually not leaving behind the car, you want to be able to take the wheels do you

Nah - i'll pay for the parts that I take. As I've always said that I would. I'll even take some parts that I have no use for - just to be fair.

There are so many unknowns around a [s]Yes[/s] No vote that no one really knows what they are voting for.