London vs the rest of the UK, current situation…

I’m afraid that other economies, ie Germany, are rather primative. They do a quaint little thing called ‘making’ stuff

Why is making stuff intrinsically better than doing stuff for other people?

because it traditionally employs more people, which is a better thing for society ?

Kindly enlighten us, RJ, how selling services to ourselves alone is sufficient to grow an economy that has at least some self reliance built into it?

Why is making stuff intrinsically better than doing stuff for other people?

It’s not even doing stuff for other people – it’s just gambling on a massive scale, knowing that when they mess it up they will get bailed out, again.

And if we had more manufacturing, our economy would be now getting a major boost from exports thanks to a weak pound.

Christ there are some bitter people on here with economic nous learned, I can only assume, via The Sun.

You could at least have picked the Mirror or something.

Making stuff is intrinsically better because it can be exported. Most service jobs can’t. Hairdressers? Lawyers? They depend upon contact. Yes, the city earns money from abroad but the service roles that are not location dependent are easily lost, hence the outsourcing of IT and call centres. Many service roles are essentially parasitic, there are basically 3 ways to create measurable wealth, you can dig stuff out of the ground, grow stuff, or make stuff out of the things you’ve got from the ground.

The city’s tax burden is only an artifact of the high salaries. If I took 10% of the salary of everyone i came into contact with I’d pay a huge amount of tax. It doesn’t mean that I’m adding value to the economy.

It’s not even doing stuff for other people – it’s just gambling on a massive scale

Isn’t most of it making money for other people, don’t you, and simply taking a cut? So your pension fund, your mortgage, your ISA, that kind of thing?

Many service roles are essentially parasitic, there are basically 3 ways to create measurable wealth, you can dig stuff out of the ground, grow stuff, or make stuff out of the things you’ve got from the ground

Hmm, not sure about this. If you run a burger van in the carpark of Nissan Sunderland, are you not also making money from the car business? Sure it’s dependent on the car industry but the car industry is just as dependent on external factors – people buying cars.. most of whom probably work in the service industry anyway.

If I took 10% of the salary of everyone i came into contact with I’d pay a huge amount of tax. It doesn’t mean that I’m adding value to the economy

If you used that money to invest in new businesses then you would…

Isn’t most of it making money for other people, don’t you, and simply taking a cut? So your pension fund, your mortgage, your ISA, that kind of thing?

Eh?

Take a look at this – a perfect example of reckless financial speculation destabilising economies – banned in the US, Japan, Brazil – but guess what, the Tories are against a ban, presumably because their mates in the city have told them so.

A committee of MEPs has voted in favour of restricting the practice of “naked” short selling.

Short-sellers usually borrow shares or bonds, sell them, then buy them back when the stock falls – pocketing the difference.

“Naked” short-selling is when a trader sells financial instruments he has not yet borrowed.

A new directive places conditions on the use of credit defaults swaps (CDS) – a form of government debt insurance.

The vote was taken by the European Parliament’s Monetary and Economic Affairs Committee.

Under the new rules those traders who want to “short” a CDS would have to own the underlying government bond before they could sell it.

Some MEPs argue that the practice of naked short selling exacerbated the financial crisis, with the borrowing costs of countries like Greece being driven up by “speculation” on government debt.

http://www.bbc.co.uk/news/business-12670943

But it’s all fine, let’s just let them carry on doing whatever they want, because there’s nothing else left.

Also manufacturing is more likely to use low skilled or unskilled labour at some level, which is probably benficial to society since there are always likely to be some people who didn’t go through higher/further education.

Or to put it another way, don’t put all your eggs in one basket. And then set fire to all your other baskets.

The bottom line here is that unless the banking/gambling industry is fundamentally restructured then they WILL bankrupt this country. Its just a case of when. Do you really think we can afford another bale out like the last one? Because they’ll take us there. We’re en route already

The sector is now massively emboldened by the knowledge that the government believes them ‘too big to fail’ and will effectively underwrite ANY level of loss with taxpayers money.

They now know also that the government has bottled it and is not seriously proposing any further regulation or reform. Their lobbying worked

This is like handing the keys back to a drunk driver after he’s caused a huge pile-up, then asking if he might like a bigger car this time? Maybe an articulated lorry? Oh… and here’s another bottle of whiskey too.

Its insanity and is busy creating the perfect financial storm. The next crash is in the post. And it will be a catastrophe. Yet the people who are presently causing it will doubtless walk away scot free, counting their millions AGAIN

I think one of the main problems is the short-term nature of the financial industry.

The financial (banking) industry has a fairly rapid turnover of staff – you either make your money and get out, or else decide it’s not for you and get out, or else move to a different company.

Furthermore, bonuses are often calculated on a short term system – e.g how much did your investments earn this year, or in some cases (frighteningly) the bonus may dependent only on how much you invested and not the results.

So if, for example, someone makes a risky investment with a pension fund and it all goes tits up two years later, there is a pretty good chance the person responsible has either retired or moved and doesn’t give a flying ****.

But it’s all fine, let’s just let them carry on doing whatever they want, because there’s nothing else left.

Ok, so short selling is bad. So that means the whole financial industry is evil and wrecks the economy? Struggling to understand here.

binners post explains it pretty well – are you being deliberately obtuse?

It doesn’t explain it at all!

He is saying that there are reckless financial practices which will cause problems in the future. I agree with that, no questions there.

However that doesn’t explain why you seem to be claiming the WHOLE financial industry is bad, and why it’s worse than the manufacturing industry.

After all manufacturing has put us in a whole lot of extremely difficult crap that’s going to take a lot more than a year or two to get out of….

After all manufacturing has put us in a whole lot of extremely difficult crap that’s going to take a lot more than a year or two to get out of….

Would you care to expand on what appears to be, at first and subsequent readings, something that doesn’t make sense?

However that doesn’t explain why you seem to be claiming the WHOLE financial industry is bad, and why it’s worse than the manufacturing industry.

There’s a number of reasons already given above why it would be better to have a broader base to our economy, which includes more manufacturing. Look at the example of Germany right now.

Over-reliance on one sector is a bad thing in itself, but especially when that sector routinely engages in spectacularly reckless business practices with enormous sums of money.

The financial services industry isn’t necessarily bad – but what apparently attracts a lot of this business to our country is a relative lack of regulation. And we’ve just seen where that’s got us…..

yawn

And we’ve just seen where that’s got us…..

Is that specifically a British problem or a global one?

Would you care to expand on what appears to be, at first and subsequent readings, something that doesn’t make sense?

Manufacturing consumes resources and emits pollutants. Banking does not 🙂 Ok so I’m being silly there but it is true that manufacturing makes stuff to feed our compulsion to by crap made from stuff dug out of the ground which is very bad news for the environment. Especially as half of that crap uses up energy when it’s running as well as when it’s being made.

You lot! LOL. A simple question about life in London and you’ve turned it into a classic STW argument about left and right wing politics!!
Sadly, given the superiority of the riding up North, it does look like I’ll end up back in London Village for work.

Anyways, a few factoids to throw into the mix, just for the fun of it:

1. The Mini – one of Britain’s ‘biggest manufacturing success stories’ – lost £30 on everyone made. They were nationalised at the time so that loss was paid for by taxpayers. Is that what we want? BMC Wikipedia link

2. The City does not make up 100% of the financial services industry and the contribution financial services makes to the UK economy. For example, LloydsTSB had in 2007 around 70,000 employees. About 40,000 IIRC were employed in branch, earning much closer to the UK median salary…

As you were….

lol.

Wunundred! 🙂

It is now raining in London. Proof that we don’t always have it better than the rest of the country.

Is that specifically a British problem or a global one?

Not a specifically british one, but certainly not a global one either. What we call the “global credit crunch” is often called the “north Atlantic credit crunch” in Asia.

It is now raining in London

at least it will damp down the dust on the trails.

oh……………………….

It’ll damp down the dust on the commute home. Less likely to get grit in my eyes. Win.

Good point. I had been coughing a bit after rides in Epping Forest actually. And I’m hoping the rock-hard baked rutted bits the flippin horseriders create will be softened, thus making flattening them out a bit easier.

A simple question about life in London and you’ve turned it into a classic STW argument about left and right wing politics

I did try my best right up there to turn it into a classic STW argument about how rubbish London is, but sadly nobody really bit.

Each time I go into London for an inteview I can’t wait to get back out. Just not my thing at all which makes my career choice terrible really!

As said before, a day trip is not the same as spending time there.

If you go for a day trip in London then you have spent time in London. And I’ve just been trolled, haven’t I? 😛

I do wish people thought more before posting on the current credit crisis. Banks or those working in banking are NOT responsible for the current recession. As an economic zone, the entire west borrowed too much money.

That’s middle class buy-to-letters, white van men buying sprinters and postal workers buying houses in the first place. Why is it the banks fault that these people are not repaying loans the banks made to them in good faith?

Most of these people spent their rainy day money in the pub / ikea. They presumed their business / home / van would bring them riches and double their money. The bank hoped to make just a few percent. Who’s greedy?

Ultimately, so many greedy people failed and gave their keys back to the banks, that some of the banks had to temporarily give their keys to the Government.

The Gov made a good profit on the banking deal, but the country won’t recover until the buy-to-letters, white van men and postal workers have been brought to account.

Ultimately, so many greedy people failed and gave their keys back to the bank, that the bank had to give its keys to the Government

If the banks had been sufficiently thoughtful they would not have loaned so much that they needed to give their keys to anyone. Individuals – sure, they’re often stupid, but financial institutions shouldn’t be taking these risks and then requesting others foot the bill. And then paying themselves a fortune shortly afterward.

Ugh, {insert northern city here}.

I see why people like living there, but it’s not for me. I went there today. It cost me £180 to get there (1hr 45min journey!), spent an hour battling my way across town on foot/bus, was faced with hundreds of grumpy looking people, and it rained.

actually i quite liked manchester and birmingham, most of the others were full of short fat people wearing blue and white sportswear who quite possibly didn’t partake in any ‘sport’ [/quote]

Who brought the north into this? I don’t live in the north.

I think you’ll find it isn’t just these mythical Northerners who resent the place. It’s the rest of the nation.

This isn’t North v South. It’s London v Not London. London, like some knickerless siren, draws in as many and as much as it can from anywhere (UK or overseas), uses them and then feeds off more.

The prominence of London as an “international” city has become such that, while it ever prospers on the back of that image, the remainder of the the UK has to fight harder and harder still to avoid being obliterated by it. And remember, Not London, isn’t a matter of geography – plenty of geographic London is, in fact, Not London.

I speak as someone born in London to less than wealthy English and Welsh parents, brought up in the home counties, and having spent the last decade and a bit living in The North.

Not London is not the poor relation, the mentally deficient brother to be hidden away from the world in an asylum. Not London is a rich and glorious pageant, but it is patronised and looked down on by London and the people who aspire to be London.

The sneering attitude of London to Not London – a BBC Northern England correspondent, I ask you – is enjoyed vicariously by those who like to sneer at those they have already abused.

Thank you!

coffeeking: the problem is the individuals paid themselves a fortune before throwing back their keys. Others basically committed fraud, e.g. signing forms saying my overtime is £xx/mth guaranteed – but once the loans bubble burst, the overtime went.

Sure, financial institutions could have been more savvy, but people were beating down the doors demanding loans right up until Northern Rock went under.

If you say “lend me a tenner to get the 1st round, I’ll pay you back”, and you don’t, why should I be held solely accountable? You asked for the loan, I didn’t make you take it. I gave you the money in good faith, you’re not paying it back.

It may be easier to blame the bank then your friends / neighbours / selves – but that doesn’t make it right.

I do wish people thought more before posting on the current credit crisis. Banks or those working in banking are NOT responsible for the current recession. As an economic zone, the entire west borrowed too much money.

That’s middle class buy-to-letters, white van men buying sprinters and postal workers buying houses in the first place. Why is it the banks fault that these people are not repaying loans the banks made to them in good faith?

Ummmm…. no – the crisis is widely reckoned to have been caused by the sub prime mortgage crisis in America – predatory lending of vast amounts of money to people who they knew never had any vaguely realistic prospect of paying it back, not white van man or middle class buy to letters but people with terrible credit ratings.

Err, no. You’re confusing widely reckoned first signs of the crisis and causes of the crisis.

Sub-prime in America burst the bubble, but was just the very tip of the iceberg in terms of $/£ damage to multinational banks. The few specialist US subprime lenders went under pretty quick without rocking the boat too much: countrywide, new century, DR Horton. Most people in the UK never even heard the names.

However, this set everyone thinking about what the rest of the “prime” debt was actually backed by. Which led to the crisis.

The big ticket problem is that the whole west is racked up in debt. And that average people and businesses are defaulting on loans they should never have asked a bank for and claimed they could afford.

binners – Member
Biggest cuts = Liverpool, Birmingham, and Hackney
Least cuts = Dorset

Dorset (of which I am a resident, though not in the Dorset County Council administered area) was just about the most underfunded, if not the most underfunded County Council in the country.

It also had the highest differential between salaries and house prices due to it’s popularity as a retirement destination for monied London/Home Counties types. As such, the relatively mild cuts are entirely reasonable.