Soros and Roubini cheer me up

Just because the governments have now realised the scale of the problem does not mean that they are any better equipped to deal with it.

This comment was removed because the moderators found it broke the house rules. Explain.

I'm trying to see the positive. I really am so I am not going to add a "but".

The main phase of the 'credit-crunch' is nearing its end. There will be more write-downs, but the system has been 'saved' - pheeww ...

However, depression for 'real' economies is only just starting, and its going to be a long LONG haul before the full damage is done and recovery (2nd quarter 2010) can begin.

Robert - if you've been cheered up by those two, there's hope for us yet!

I'm always wary of people like George Soros - unless you know what positions they have, how can you know whether they're talking things up or down? Just a thought.

May I propose the bare bones of a 10 point plan to put the country back on its feet:

1. At the root of the current problems are over-valuations of many, if not all, assets and excess debt. It has to be accepted that both have to fall to a long-term sustainable level before we can begin to recover. Attempts to slow the declines may be entirely the right thing to do but it must be accepted and recognised that they can only delay reaching the bottom.

2. Creeping deflation will be very damaging to the economy and extremely painful. Equally, over-coming the problems through inflation will hit particularly hard the many innocent savers and pensioners. A controlled, one-off deflation may be an acceptable compromise. The first move would be encouragement to all businesses and employees to reduce wages and salaries by, say, 10%. The reductions should include the national minimum wage and there might be larger reductions for management. This should improve the financial state of businesses and might delay or make unnecessary redundancy plans. The additional job security should weigh against the reduced income.

3. All upward-only clauses in lease agreements should be immediately made void. Landlords should be encouraged to reduce rent charges by an immediate, one-off, say, 10%. This would represent one step towards re-balancing the return on property assets and would also improve the finances of many businesses.

4. The retail sector should realise the fundamental changes it has to face. The consumer debt-lead boom of recent years was unsustainable. Let us assume that consumer spending has to fall 20% to achieve long-term stability. High streeet retailers must accept that internet shopping is here to stay and has taken a large and permanent share of the market. In addition, the likes of Tesco have taken a large and permanent share of the market. The amount left for other high street retailers will be significantly lower than it has been - they must adapt to the new circumstances. This is starting to happen through various receiverships.

5. Consumers should be encouraged to "buy British" in order to support the economy. This can be assisted by retailers making clear the proportion of a product's value-added is British. It cannot, and certainly should not, be achieved through import duties and taxes. Every pound of spending should be made to count in the economic recovery. Sadly such publicity would highlight our dependancy on imports but the population truly understanding the situation would be the first step to effecting change.

6. The folly of the recent VAT cut should be recognised and immediately reversed. An equivalent amount should be put into the economy through a reduction in employers' national insurance with immediate effect. Together with the wages and salary cuts this would encourage employment and discourage redundancies.

7. The Government should introduce grants and incentives to re-establish manufacturing operations in the UK, there-by, over the medium term, seeking to reduce the dependency on imports. Green initiatives and sensible infrastructure projects should be given particular encouragement. Major unaffordable and "luxury" government expenditure projects should be scrapped - eg Trident and the identity card project.

8. An add-on policy might be the stabilisation of petrol prices at, say, £1 per litre through a flexible fuel duty system in which duty counter-acts the effect of market price fluctuations. This would bring greater certainty to business and household budgets and would maintain some green focus.

9. A new era of honesty and responsibility should be started with greed being driven out. The politicians should begin the process in the hope that, in passing, they might regain our respect.

10. A pre-condition to making progress on any of the above is the holding of a general election so that the country can vent its anger on Gordon Brown who should accept a large share of responsibility for the mess we are in but who is in complete denial that even the smallest part is down to him. His performance on the Today programme last week was truly appalling.

Until Flash admits to being a debtaholic he will continue to wreck everyones lives and drag us all into the world gutter.

I understand Soros holds no more sterling so would spoil his street cred if the pound was to fall another 25%.

On the day the IMF confirmed what we know, that due to the spendthrift incompetence of Gordon & co we are facing the worst recession amongst all advanced countries, (and not 'the best placed economy to benefit from the upturn when it happens') does Peston break the pattern and finally criticise the govt?

The answer is yet again no, Robert the price you are paying in diminishing credibility for them feeding you the odd scrap of information simply isnt worth it

What utter twaddle RP

How can you state Soros is happy that the pound has fallen enough for now and the D word is still a very high risk and deal relieved or happier???????????????

Governments have known and acknowleged the scale of this R soon to be D for months and they have done everthing they know to stem the negative flow - AND IT HAS FAILED on all fronts. Absolutely nothing they have done is working. This makes you feel happier??????????

If the Japanese economy is forecast to contract at the rate of 2.5% why is the Yen so strong?

The pound is oversold because it is an easy target and the city of London is the major currency trading centre where the dealers focus on UK problems and because of people like Soros.

There are well publicised concerns about the UK PSBR but is is low by international standards and less than a third of Japan's which is well over 150% of GDP. Can anyone explain the different treatment of the two currencies

Whilst nobody really knows which were the causes of the worldwide downturn, we now know for sure that the UK's not where it all started. Maybe it was US sub-primes, or US and European trade imbalances with Asia: or all of those together.

It will, of course, be interesting to argue about which countries turn out to be the most and the least affected - lots of jolly academic papers to be written on that - and which government remedies worked most effectively. [How can we tell?]

But the real test for us in the UK will be how much profit our shares in UK Banks will make for us? And when can we cash-in those profits! And for how long will the interest rate on my mortgage stay below 2% ?

ADDICTED TO BAD NEWS

well that isn't really what I'd call a more cheerful post from you Robert

come on, try harder; here's more good news:

Downing St have 'rejected' the IMF 2.8% prediction, saying that in fact the UK will only be 3rd worst of all 'the advanced nations' (what on earth do they mean by that - the G8?) over 3 years, according to their figures - better than Japan or Italy

The Institute of Fiscal Studies are predicting that UK decline of GDP may only be 1.3%

The lady from the British Bankers Assoc says that everything will be fine if the BBC will just turn their recession red arrow around so that it points up instead of down; go on Robert you have the influence to get that red arrow turned over don't you?

I bet it will get worse, a lot worse!

Why would Soros talk down the pound, he needs a good entry, doesn't he? ;)

It is too early to be encouraged by governments taking the problem seriously, so far their ideas have been more of what ails us. The last thing we need is an ill-considered stampede in the wrong direction.

"According to the IMF, the prize for worst performer among the big economies goes to you-know-which: our proud land, the UK.

It forecasts the UK will contract by 2.8% in 2009, a steeper decline than the US (predicted to contract by 1.6%), the euro area (minus 2%) and Japan (minus 2.6%)".

This is clear and unequivocal. We need an equally clear answer now from Gordon Brown - were we really, when he said it, 'best placed' to weather a downturn? If not, was he misleading us? If yes, what has changed since?

This information simply confirms what is already known and which GB refuses to acknowledge or apologise for. Every so called rescue plan has failed dismally and the only way out is for him to resign and go to the country before more public money is thrown at his half baked schemes. Aside from there being a worldwide problem, we must be the laughing stock of the world. Terrifying, truly terrifying.

Robert,
I was intending Peston Blog avoidance but It must be said:
Rogers and Soros? Are they still working together?
I am bearish on the Pound v. USD to a depressive effect this year and tended to agree with Rogers.
Soros now comes out with his view.
He seems to indicate that his actual exposure is now realized, with profits and range fluctuation is now the short to medium view for him to tell the rest of the World about.
This is not just "crowing".
After today's IMF projection on Sterling and the UK economy, do you or anyone else not think that their comments are contributing to volatility in this market?
I cannot profit from volatility, especially as no-one would give two whits about my market opinions.
I do write in self- moderated indignation.
N.

"Our combination of massive debts, an over-valued housing market and excessive economic dependence on financial services (the City) has been toxic."

As most people contributing to these blobs have been saying fro several months!

Soros is one of the few people who is more than prepard to talk his own book. Its flash, gaudy but uts also very courageous.

He doesn't hide behind 'the company' logo, he is the company logo as is Warren Buffet but to a much greater degree.

But the difference is that Soros is a trader and Buffet is an investor, which is why we must put Soros's views into perpsective.

Roubini was not alone but it is felt he was which is stupid. The difference here si that he again was prepared to stand up an be counted where others palyed the chattering classes route.

What we can learn from this is that real economic debate is stifled by the ignorant bankers who believe they are anything but, and politicians who are looking at retirement exits from day one.

Perhaps we will stop playing at dithering to perfection and do the right thing buy acting early as Blanchflower tried to get the Bank of England to do.

In the UK we are still prepared to defend the rights of the notoriously self interested yet totally ignorant lobbies before the national interest.

When that changes things, to coin the phrase, can and will only get better.

Well the big beasts have spoken to you Robert and it seams they fear the worst as many of us have for several years.

They do also recognise that there is a need for Global management and for a serious re-order of the financial institutions is vital but we have to acknowledge there are some real fundamentals which have to be addressed if we are to go forward.

I who have doggedly clung to the belief that the only thing that generates wealth that is of value in economics or to a community is something which is farmed, mined or made and or improved anything else is a drain on the economic growth.

Have now at last admitted the industrial age is dead the technology age is nearly over and we are in the knowledge age that is genuine knowledge not how to squeeze a few bucks out of a Mississippi local by giving him a credit card and a mortgage and then selling the debt as an asset to a greedy British banker.

All the above proves is we have passed from a national market to a world market and were as the morals ethics and codes of honesty and decency that guided us in the past have fade into greed and self interest and celebrity the world now needs a broader code of conduct and some very rigorous means of enforcing the standards.

Essentially-and this I doubt if anyone can get their heads round is this - we have to stop doing things by conflict and do things by cooperation not just something everything - we will not progress until we do.

Where do we start – I suggest Parliament rubout the two red lines and force every member to sit with at leas one shoulder to a member of an opposing party make every vote a free vote MP’s should represent their constituents.

Make all courts have a persons perspective verses the other perspective no claimant no defendant no defence no prosecution the argument for x and the argument for y no laws other than the Ten Commandments. Everything else is a guide lines and a code of conduct for society of what is acceptable and what is not.

Contracts should be decide on fairness and benefit to both parties and benefit to the greater community in other word we decide by cooperation not confrontation

That a long way a way I hear you say not practical you couldn’t trust…… stop there - it can be as far away as you like it ten thousand years if you want but I tell you all this life, money, happiness, contentment, the economy, injustice, war and society is not going to get any better for 95% of the world population until we or some generation start to move in that direction and that is an indisputable fact.

My guess is that Soros is almost right; sterling is close to the bottom but it has a little further to go. The eventual consequence will be stagflation.

I note your comment, Robert, concerning our economy; massive debts, overvalued housing and excessive dependence on the City.

Now who would that be down to?

Be careful Robert, you can still be sent back to the factory.

Robert - feeling cheery me ole China? You're avin a Giraffe!

Time to march against these Bankers!

Interesting article in the Guardian yesterday:

---------

Week of mass strikes set to paralyse France in protest against Sarkozy's reforms

---------

Fair play to the French, it's time we did something here too to get heard!

Great that's wonderful news, isn't it?

UK PLC is busted, HMG is broke. We're into a Depression and the globe is in Stagnation.

Ok, so we can all go home, stop navel gazing and get on with life.

I don't think so. Not on the words of Mr Soros or anyone else.

the G20 leaders are going to have to bite the political bullet and come up with an enormous global infrastructure project to get heavy industry and supporting markets up and running.

anyone for a land grab on Mars? how about free land and access to mineral resources in return for colonising the red planet?

we could start again as we've messed this one up. anyone for Martian regulator? Robert?

So..... can we expect some backtracking from Mr Brown re: "The UK is best-placed to weather the downturn", etc, etc? Or will he just ignore the IMF and keep repeating his mantras?

2.8% is not as bad as it sounds! In the context of the UK's above-trend growth since 1992, this is a very 'affordable' recession. Some details of just how the UK has grown and how much better off we are as a result are here:
https://www.knowingandmaking.com/2009/01/comparative-growth-and-shrinkage.html

As I post, eddixon, number one has just appeared on the blog.
Who's off piste?
N.

As long as satirical responses to Roberts Blog continue then depression will be impossible.

Humour in dificult times proves that true wealth is the seed energy that both prepares and acts in expectation of the coming spring ,after the winter of discointent [the next millenium]

All we need now is for Jim Rodgers to return to the fray and restate stirling is overvalued and the two of them[including Sorros ]can do their tango shorting in phaze and clean up whats left of the surpluslickquiditty.

So the government now realises that the economy is free falling off a cliff without a parachute. That makes me feel a whole load better knowing that Gordon is at the bottom with his arms spread out shouting to his cronies.."uh ...get a blanket!", whilst Soros and his buddies are betting on whether we will survive or not.

In PMQ's this was dismissed by Crash

Are you now off message Robert?

Or are you trying to drag the government to the point where they realise the import of these market words?

UK the worst performer? But Gordon keeps saying how well placed we are!

Surely all of us saying he's been lying through his back teeth for the last few months, are evil minions of a Tory cadre - determined to bring down the UK by downtalking the economy!

That, or Brown is full of something coloured brown.

These are two interesting men, but I don't think either has the solutions to the problem we are facing.

We are never going to be able to hold the deficit where it is, never mind shrink it, unless we are prepared for this economy to absolutely scream with its death throes! So a deficit expansion is on the cards. Do the government have the courage for a massive one? It might not do much good in a shrinking world economy. Then again we might be in a good position when things turn-up.

Can the government really prop-up industry after industry? If they prop up the cars, they'll have to prop-up the pubs. If they prop-up them, they'll have to prop-up the restaurants etc. Its the collapse of other areas that is causing the problem.

The real problem is, and I keep repeating it, debt. The government are prepared to guarantee loans, support loans, give loans, but that increases the debt. The credit crunch happened because the banks had run out of markets, and had found the last group of people they could give sizeable loans to and keep the money supply expanding. The dirt poor. They never even credit-checked them - they were that desperate!

But there is literally no one left to lend to now to boost the money supply sufficently. Reliable people, sound companies may want loans but that will not expand the money supply sufficently to pay back the already borrowed money and keep us in the style we've become accustomed to. The banks know that if a money supply isn't expanding, it's contracting; and they don't want to be losers as it does so.

Why then do the government provide packages that wait on an increased appetite for lending to come along to boost the economy when it is obvious that it won't come fast enough and that by waiting for it they make it even harder for the banks to lend sensibly? The government is literally being hoisted by its own petard.

Ironically, the Tories with their prejudices about cutting debt would cause an economic disaster unlike anything witnessed here before, even after the Napoleonic wars, but...that's why they'll get in!

The peoples' republic of Gordistan is well placed to meet the challenges ahead of us, that are the creation of evil foreigners.

Ive also heard Dr Doom and he doesn't cheer me up.
Nor do his solutions for the world economy.
Far too broadbased and completely unworkable.

Ken Clarke cheered me up.

This country getting to grips with the nitty gritty. GB to stop burning billions of pounds of our future on scatterbrained throw of the dice ideas.

Acting now where possible ahead of the curve instead of being way behind it.

Finding someonr who can bring Gordon Brown back into the real world and keeping him well away from meddling any further.

I liked and agreed with what Ken Clarke had to say.

This is going to be a long and horrible time for most of us and the solutions will only be gradual but they must be right every time.

There is no time left for any more mistakes.

I do not listen to these high flying economists They are only in it to make money for themselves

I have to be highly suspicious of each's own agenda.

Mmm... how cosy. Roubini is worth listening to - he's got the moral courage to stand against the prevailing orthodoxy and that's something rare among businessmen, politicians and academics.

Had I been in your shoes, I'd have asked Soros (first, for a fiver and then) to spend some of his ERM gains on making sure that the 2.2bn people worldwide without clean drinking water got at least a water filtration system to stop them dying before they reach school age. He may be a sage - but unlike Roubini - he's a sage of unenlightened self-interest.

Part of the problem with our financial institutions and the people in them is that they see themselves as a sort of breed apart rather than being 'part of the main' as John Donne put it. That doesn't make for responsible behaviour and it inclines them to view the rest of the population with a sort of haughty detachment, whereas the commodity they deal in - money - has their undivided attention. They set the tone for what is permissible, which in this case is more money than they'lll ever need paid to the management and executives who sit at the head of the world's leading companies.

When the background to this is millions of people being thrown out of work it puts the activities of these same executives into their proper place - they are a squalid bunch of vultures pecking at thinning carcass.

They are among those other dimwits Croesus and Midas, who blinded by their own greed, lost sight of what mattered and what was important. oh, I know they do a lot for charity. So what! Attlee got in right when he said: "Charity is a cold grey loveless thing. If a rich man wants to help the poor, he should pay his taxes gladly, not dole out money at a whim."

The utter indifference of Jim Rogers when questioned about the UK economy spoke volumes about him as a man.

So now it is acknowledged what the problem is - and in particular just how bad it is for the UK - can we look forward to seeing the back of the person that keeps saying the problem is elsewhere. That would be a good start

poor old robert peston, even on a day like today when shares have rallied, he just cant help puoring salt in the wound

I have read the IMF forecast and am puzzled by Figs 1, 4, 5 & 6 where the grey (future) estimates seem to bear little or no relation to actual trends during 2008.

I guess that's because, as the report sub-heading half way down says, "The uncertainty surrounding the outlook is unusually large"

Finance-speak for "we have absolutely no idea what will really happen" I guess.

Isn't the problem that these hedge fund parasites have been allowed to commit financial terrorism for far too long.One whose name escapes me for the present,said in The Independent the other day that Britain in finished and he was going to short sell the pound.He now lives in Singapore which is like London in 1907! No doubt he means it has lax labour laws,no workers party and low taxes for the wealthy etc.
Thanks pal!

1.5 hours and no moderation, whats the point of this blog?

It has died, just like the labour party!

Nice thoughts 7 angryCB. I can tell you want the mess solved.

Unless Great Britain has a virtual presence on 2nd Life, they'll never all happen.

None will happen without calls such as yours though!
N.

So the conclusion to what you're saying is that the government needs to spend some serious lolly a la Roosevelt on some major capital projects. Yes? As far as I can remember from "O'Level" Social and Economic History it took WW2 and Lend Lease to get the United States to the position of the world's leading economic power. In other words, isn't this just a stop-gap? In the UK example it wasn't until the late 1930s that the economy started to pull out of the depression and then the war came along. Don't we need to look at the bigger picture re. manufacturing and finding new markets for it? The concomittant of this is that some of this funding ought to go in foreign aid: 1),to stimulate growth; 2) to secure raw materials and 3) to add to the existing pool of buyers on which any new and organic growth in the world economy will depend.
I can't see how anything tangible will come out of the following mix: low interest rates; high levels of unemployment; negative equity in the property market; high rates of government borrowing; lower tax revenues; reduced government spending; a low pound (in an economy where manufacturing way down the list of priorities) and poor demand for British goods from economies in a similar state to our own. What's your view?

Most of this negative media kicking around about the global economy, needs to be balanced out with positive solutions and leadership.

#7 angryCB

You suggest we all take a 10% pay cut.

WHY?

How about the Elite who own 98% of the wealth put their hand in their pocket!

Browns legacy

AN ECONOMY DROWNED BY DEBT FOR 20

PLUS YEARS.

If we are lucky the BIG R might level in 4 to

5 years with static performance for a further

5.

UK PLC IS BUST SO ARE VAST SECTIONS OF

THE POPULATION.

THE VALUE OF STERLING IS ANYONES GUESS

BUT MOST LIKELY: GOING DOWN?

I'm sure everyone is delighted that you've cheered up.

What about China? It's growth has been sustained by exports - what are the political consequences if this stops - can the Chinese internal economy take up the slack caused by what is likely to be a substantial slow down in exports?

BTW what is the definition of a depression as opposed to a recession?

Some of the above comments about the VAT reduction do miss the point. Although a reduction in employer NI is superficially attractive, companies this year will make decisions on hiring (or firing) staff not on this, but on their confidence as to whether consumers will buy thier goods. The VAT cut will put £12b into the economy and will provide a modest boost to consumer spending and confidence. It is not a magic bullet, indeed there is no such thing, but over the course of the year it may help.

Has anyone else noticed that all the prices have crept up to x.99 again. I asked why and was told it was inflation. So much for the VAT reduction, good for 3 months.

I watched those two jokers George Soros and Jimmy Rogers on TV for years and their advice stank. Rogers was so wrong so many times, he's hardly even on CNBC anymore. So they cheered you up. Doesn't take much Mr. Peston. I'm cheered today...because the one stock I own went up $1 a share. How did your portfolio do?

Is a depression "on the cards" as you Brits say? Yes and it has nothing to do with the UK. There is only one way out. The US must start printing money like crazy. It must inflate its markets with cash, devalue the dollar, and this will allow the rapid writedown of old debt including the biggest debtor of them all, the US government itself. Holders of debt will be paid pennies on the dollar but if this doesn't happen, most won't be paid at all as the debts go into default. The US therefore needs a massive round of wage price inflation. If other nations don't follow suit, they will go into a depression also because they will be priced out of the US market. How much money must the US print? I'd guess at least 5 to 15 trillion dollars, about 4 to 12 months of its GDP.

This credit crunch and housing slump has been excrutiatingly painful to extract admissions from economic forecasters and financial leaders.
Even when the obvious was clear to see, they were still on the late running train of admission.
It seems opinion slowly drifted from no impact of the crunch on the real economy, to a chance of a slowdown, to a technical recession, to a recession followed by recovery in the 2nd half of 2009, and then the latest a recovery in 2010.
As for the housing slump, this was pitched originally as a slow down in price increases.
Throughout all of this those arguing that a major slump was on the card were derided for abject pessimism.
Now it appears they were not far removed from reality if not on the nail in their estimates.

So, considering where the World opinion has been dragged reluctantly, those with form for accuracy are predicting a depression even Roubini. So to the likes of post 4 The NewPonzi, 2nd half 2010 (the current concensus) is highly unlikely, this could easily be a 10 year affair.

Failure to recognise the ensuing nature of the problems has (as has been commented by Roberts guests) been a major reason why the efforts by economists and ministers so far as been ineffective and belated.

When the value of money and assets has been reset, then and only then will the untenable boom be over, and this could take a good decade to rebalance (especially with money printing on the cards).

I would recommend Robert investigate what are still seen as the margins of economic forecasting as they could be right, and if so, to not prepare for it now could be devastating for the British people who are (on a Worldwide basis) suffering the impacts the most.

Gordon Brown is an annoying little nit!

Why can't this mealy mouthed man just admit his mistakes.

We are not prepared for the bust and he has not abolished boom and bust................................he's actually created the biggest boom and bust EVER known in this country!

How long will it be before Labour MP's dust off his ejection seat once again?

I for one cannot wait to see him booted out either by his own backbenchers or the electorate. Imagine his face.....makes me smile.

Meanwhile the rest of us suffer for his failed and imprudent policies.

Mega debt, millions without work, repo's, social disorder and no hope of salvation under this Gov't..............just months of knee jerk wretched governance from an administration most certainly as Cameron put it...........in it's death throes!

Let's get the dream team of Ken Clarke and Vince Cable to get us out of the mess.......or if the Conservatives win....Ken on his own will do!

At least we'll be running a sensible economic policy by a Gov't able to make the right medium term decisions rather than day to day policy rants designed for electoral expediency.

Brown must be throughly naffed off because the more he announces the more he goes down in the polls? He must wonder why?

It's because the British electorate have seen through your bluff and bluster and are now enduring hardships brought on by 12 years of utter incompetance.

I blame all those who voted Labour in 1997, 2001 and 2005.

Let's hope you guys have learned your lesson and don't repeat it in the next 18 months!

Robert...
..."Roubini is the economist who probably shouted loudest and earliest about the looming financial disaster.

And what he said cheered me up a bit (and I needed it) - in that he believes governments at last acknowledge the scale of the problem, even if (in his view) they haven't yet sufficiently co-ordinated their policies to create money, use taxes and public spending to stimulate demand, and fix banking systems. ..."



The revival of Banking Sector shares this week suggests that there are 'forces' at work... and would be at odds with your
analysis.

Surely The Great Godro hasn't fixed the Banks and not told everyone?

..."Our combination of massive debts, an over-valued housing market and excessive economic dependence on financial services (the City) has been toxic. ..."

Problem fixed?

The established World Order appears to be greed and chicanery...

Snake-oil Salesmen required... Adders/ bankers need not apply

If GB would finally come clean about the state of UK plc. we might have a chance to start to take some postive action to move forward.

The jig is up GB -- stop insulting the intelligence of the British public and continually repeating these tied old sound bites! You`re fooling no one but yourself as you will see come next election day.

As much as I despise Brown, I hate the thought of what Cameron will get up to.

Er Merv

What is it David,


Pass mal une Interest rate Lever Si vous plais (Cameron pulls down as hard as he can)

Result? You don’t want to know!

43 armchairstregist.

How many years have we had of foreign aid this decade in Iraq and Afghanistan not to mention domestic infrastructure spending [admittedly military]?
I seem to remember that Vietnam was paid for by inflation but that was many years ago. Not quite wearing shorts then but that's a previous discussion.
Let's give aid to Zimbabwe so long as it doesn't go into Mugo's short-term bottomless pockets.

N.

Forget Soros and Rubix

The only true indicator of the deepening impact of the depression is how many posts RP's blogs get as people lose their PC's or save their electicity.

If RP's blogs contract more than 2% then we're all in trouble .

If it keeps inflating then another bubble needs to be burst!

So we all bought into the dream, a piece of paper had some value and expected it to retain it's value when all across the world countries were making there own bits of paper.

The media outrage, the market spikes and our reliance on asset stripping the planet point to one thing. The system does not work. The media is just trying to scare us into accepting what is to come and we shouldn't.

We as humans can only recognize and remember a thousand names & people. We need to make cooperatives with just that many people. We should include workers, family, our elders and our children. Our cooperatives need to have a single goal, to better our lives and that of our neighbours.

We are perfectly capable of supporting ourselves and ours. We dont need a government redistributing our wealth. We dont need a government watching our every move.

A little "whistling in the dark"? It helps me at times, when I'm affraid. However, as to it having any effect on world debt in the millions and millions of billions, maybe putting our heads in the sand would be just as effective. I wonder what these two guys, Soros and Roubini, are doing right this minute, you can bet their not trying to figue out how to pay their heating bills, maybe getting a rubdown or having someone mix them a fresh martini by the pool?

This crisis must now move rapidly from one of morbid fascination with things financial and economic, to one of brutal political reality.

Gordon Brown has demonstrably been an unmitigated disaster for the UK; just look at the latest IMF and IFS Reports. It is shocking the extent to which our Prime Minister is prepared to spout barefaced claptrap about the other-worldliness of this situation and his benign involvement.

This behaviour in the face of incontrovertible evidence that, of all of the world's developed economies, the UK is careering fastest towards basket case. For Gordon, however, the crisis is all America's fault; the problem is global (and, therefore, not one he can/should own); the UK is in great shape. You what, Prime Minister?

Brown spews out this rubbish time and again on TV, on the wireless, during speeches, at press conferences, in Parliament ... anywhere he can really. To my utter astonishment a significant minority of the British people still believe him; what on earth are they on? What do they read/watch/listen to?

The latest reports from the IMF and IFS combine to drive a stake through the heart of Gordon Brown's pathological denial that he has anything to answer for in all of this.

All the portents are that the UK's problems will soon be moving swiftly from financial and economic forecasts, statistics and technicalities to dreadful social problems.

There is now a scary, bunker-mentality emanating from the Cabinet. Brown is seized with indecision, able only to make one panic-stricken tactical decision after the other, unable to grasp the true nature and scale of disaster he's masterminded, still less able to map out a strategy for recovery.

Gordon Brown has become an affront to the dignity of the office of Prime Minister of the United Kingdom. His cabinet colleagues are culpable for letting him get away with this; it's that bunker mentality again.

If Cameron doesn't up his game pretty damn quick and start landing some killer blows on Brown, I'll wager that the situation in this country will get ugly over the next 12 - 18 months. If Brown had an ounce of decency or statemanship, or the qualities of a gentleman, he'd resign tomorrow morning. Fat chance eh?

So, prepare for an ugly year and, like the IFS reports today, 20 years of austerity. Go on (unelected) Prime Minister, say it again, "No more boom and bust ...".

So, who do you believe? George Soros who has a proven and unenviable track record, or Gordon Brown who doesn't. Mr Brown still has still to explain what happened to our gold reserves and what we have got in return for billions sunk into the NHS. From today's news, it seems that they have got e-mail working and I am supposed to be impressed by this!

And my point is that Agius, Varley and Soros are professionals and haven't got where they are today by being stupid. On the other hand (and as far as I can tell) neither Gordon Brown or Alastair Darling have any formal qualifications in anything to do with money (economics, banking or even accountancy). Do you want to believe the amateurs of the professionals? - it's not a trick question.

In my lifeboat, I have Marcus Agius, John Varley and George Soros. Gordon Brown and Alastair Darling are a waste of rations and can take their chances with the sharks.

I would like you guys from the media to try and focus a little bit on the positive please!

For instance: Asda have created 1000 jobs as have BSkyB, i don't see you reporting on this. Our mortgages have gone down, of which i have fixed the rate for 2 years, yippee! and i have no intention of selling my house so i don't particularly care if it is worth £30k less, as in 2 years it will probably be worth £30k more :)

One of the reasons the economy is where it is now is the media focussing on the negatives and promoting a lack of confidence.

If you could look on the flip side and report on the positives, this will lift us all and raise everyone's moral.

"I blame all those who voted Labour in 1997, 2001 and 2005.

Let's hope you guys have learned your lesson and don't repeat it in the next 18 months!"

I see the quote in 15 years time:

"I blame all those who voted Tory in 2010, 2014 and 2018.

Let's hope you guys have learned your lesson and don't repeat it in the next 18 months!"

So pleased that we, the licence fee payers, have been able to pay for you to be cheered up. I'd be cheered up if someone else paid for a nice trip to Davos

Perhaps Robert you have some suggestions for the rest of us as to how we might be cheered up.

We sure as heck are 'best placed to face the downturn' in the words of Gordon Brown aren't we? Well are we? Oops!

Is this GDP, GNP or some other measure? Percentage of what? Sloppy reporting.

Oh and by the way 0.5% growth worldwide means that some people will still starve, some people will be in war zones, rather more will eat and keep warm, clothed, housed and fed. Some will do this with less in their back pockets.

We will not be back to the stone age

Enough moaning and groaning Robert, we don't pay you for you to tell us you need cheering up. I think your job is pretty safe, so please don't insult us with your 'anxieties and misery' whilst admitting you are on a working jolly

The site below keeps tabs on the latest layoff numbers.

https://www.layoffdaily.com/

I believe that this recession will take quite a number of years to recover from. It will be longer and more prolonged compared to other more recent downturns - possibly 5 to 7.5 years to recover. The structural changes that are required to stabilise and introduce confidence to the public and institutions will take a number of years to introduce and embed.

# 61 mysteriousfiona

You are joking ... aren't you?

If not, then I can see that Gordon Brown and you could have a lot in common. If you take a look at my post at # 59, it's possible that you're one of the folk that can answer my question about what it is exactly that people like you smoke? Nothing personal at all, but comments like yours are, er, a tad naive to say the least.

When you quote forecasts from supposed financial experts - , IMF etc - could we get an idea of the accuracy of their previous forecasts - - - IE lets have an accurate history of how good they are -- How accurately did they predict the Global Recession

No 32 speaks the whole truth.

Nobody in HMG live in the real world of ordinary people. They are protected from the realities of everyday life, most having never held down a proper job. For them making ends meet has never been a problem.

However these politicians are now saying that Banks must lend more money to people in order to save the economy.

I have said before, and I will say again, there are people with money and there are borrowers. Those with money only buy what they need when they need it, that is why they have the money in the first place. It is only those that live beyond their means that will borrow, and at the moment they are already maxed out.

I understand that Banks have been turning down 1600 requests a day for car finance. Most people are not refused for lack of funds, but because they are carrying too much debt already.

Surely this car "bail out" will not mean that more debt will piled on top of an already dodgy mountain.

Most of the "big" purchases in the last few years have been achieved through reckless people taking equity out of their home in order to buy 4x4 cars, holidays, luxury items etc.

This form of borrowing has now ceased causing an annual shortfall of 50bn being spent within the economy. It was not real money but created by a false asset gain.

This asset is now depreciating leaving the lenders and the borrowers with a lot less collateral against the loan.

How can the Banks possibly cover the 50bn spent then when people have no other asset to borrow against, at a time when many other lenders have left the market place.

What I have said may be simplistic but who in their right mind would want to borrow money in todays world to purchase an item like a car, that will depreciate by at least 20% as soon as you drive it away. You only have to visit the car auction house near where I live to witness the cars under two years of age, that are passing through unsold. And I am talking here of cars that cost in excess of 30k when they were new.

I have to agree with a few of Ron Pauls observations of the problems in the USA and thr solution and it will work here


We can assume there will be a big bang, if China decides to start using the money it has saved up, if it holds it then god knows why they would that is all that is saving us just now

But rather than wait these proposals will help.


1. House prices need to come down

2.If people are in neg equity banks can extend the time of the mortgage

3.Reduce the cost of commercial rent, to encourage the small startups to populate the high street, this can be done , by making commercial property rent tax free.
Commercial rent to be frozen and no other fees to be considered to allow for fair distribution.


4.Move runway 3 to the midlands , build a high speed rail link to Heathrow from the North

5.Make it financially attractive to move things from London to the North and Midlands.

6 Retire the house of Lords

7 Do away with the Circus that is PMQ and have him or her answer questions from the public , in a different city televised every week

8 If you become a minister then no other jobs may be done.

9 Imprisonment for corruption

10 ten percent tax rate for all income from 50k- £100k anything over £250k 50%
anything under 20k tax free

11 statutory work for the unemployed , be it sweeping streets, helping out the elderly, if you dont do this , you will get no money, this goes for single mums and dads too.

12.Accountants and Auditors Liable for signing off of company accounts, if they dont blow the whistle they get huge fines, if they do blow the whistle they get huge reward , this will encourage big business to be nice and play fair

13.All accounts to be settled within 30 days, no negotiation, illegal to negotiate longer payment terms, even if you are the company doing the bidding, this can be checked again by accountants same rule as above.
Take note Tesco et al fines of a million quid per offence for them, and also for Tesco Asda etc to have to renegotiate their purchase price upwards to be at least cost + 10% in favour of the supplier, to allow small business to make a living

14.Utility companies to be nationalised

15. National credit unions set up , all loan shark companies to be made illegal or if they would like to stay in business no more than 1% higher than average bank lending rate

16 Daily publication of all government minutes

17 Scrap the Anti Terrorist laws

18 Bring home all troops from abroad

19 Have local community wardens employed in all areas with harsh sentences for all who break the law, using video evidence from the wardens

20 theres more but its time for a cuppa

the above is very very doable and would not cost very much compared to what they are doing now





Let companies that are going to fail, fail, let the bones be picked and have private investment buy the bones and restart
Have a national saving scheme and get rid of government borrowing.
Get rid of 80% of the government.

Those greedy companies who got fat over the last ten years are using the Crunch as an excuse to shed the extra pounds.
Most of them thought the sky was the limit. Expand, expand, expand and forget about your debts. Exactly like those people who lived the high life on borrowed time and money.
We will see this trend continue until the UK gets leaner once again and the British more cautious with their money.
We will a lot of businesses fold over the next few months but I really believe that apart from a small unlucky proportion, those companies who are run efficiently and responsibly will manage to survive and come out stronger.

61. mysteriousFiona

"I would like you guys from the media to try and focus a little bit on the positive please!"

Fiona,

RP is a "lagging indicator". Hence the reason he's on holiday in Davos (at your expense as a licence payer) with groups of people whose businesses are falling apart (private equity, Hedge Fund managers, senior bankers etc). These people are yesterday's news on the whole. If they had proper jobs that could improve the economy, they'd be doing them, not glugging Krug in Davos. RP could be here, getting the scoop on the good news you note, plus a few others, such as the fact that Citi have called Lloyds a "Buy". It's quite a while since any broker recommended any bank as a shareholding. He'd also see that banks shares generally have now gone up, sharply, for three successive days. Much more of this and we'll have to acknowledge that real investors must be buying them.

Or he could go to Washington DC and report on the positive impact Pres Obama's plans (especially his "bad bank" one, I think) is having on sentiment there (S&P up a further 3.5% today).

I don't think it's quite accurate to say there's lots of good "real" economic news on the streets right now. Most of the stuff that affects us day-to-day (reposessions, job losses etc) are lagging indicators. However, it is true to say that the news is getting less bad and, more importantly, is now starting to be not as bad as forecast. The positives I've noted are leading indicators, and I can chuck in a couple more from Europe: French consumer confidence up (ie less negative) from last month and better than forecast. German investor confidence up for the last two months (again, less bad than previously rather than positively good, but beating expectations).

So I agree RP and others should report on these more. But you won't get any of it from Davos. This year's theme is "DOOM", as Davos is a media circus, not a serious economic gathering.

RP was late getting into the "Doom" scenario, and he'll be late pulling out of it. Like I say, a lagging indicator.

I was thinking about what the next stage of this whole unravelling will be and then something happened at work. I am in aviation and like a lot of industries most of our assets (aircraft) are leased. The lessors borrow money to buy the aircraft but the banks insist on a Loan-to-Value on the amount so that they aren't over-exposed on the loan - just like your mortgage. Trouble is with the current downturn in demand and aircraft deliveries being deferred the residual value of aircraft has dropped dramatically - upwards of 20% in some cases. This is obliging the banks to demand money to make up the LTV ratio. If you own a lot of aircraft you could owe a lot of money which you probably haven't got without selling some other aircraft in a depressed market thus driving values even lower. There are two really big lessors - ILFC - owned by AIG - and GECAS - owned by GE. Watch this space as they do their best to get out of this.

# 60 bankshareholder....

had to laugh at your last part, i'm afraid that you have kept the real sharks in the lifeboat with you!!!

Have to agree though, gordy and ally are out of their depth and swimming further up the deep end with every move they make.

Robert, i am concerned that george may have pokerfaced you, nothing is priced in when the banks are hiding the scale of their, sorry our exposure.
Still, glad they cheered you up old son, lets hope we can return to indiana peston and the blog of doom soon!

#61

Yes ASDA and Morrisons have created jobs BUT (and it is a significant but) people don't eat MORE food during a recession - if anything they eat less - but more likely they are switching to lower quality and thereby cheaper produce.

It seems to me, therefore that the Jobs being created by these two supermarkets will, in effect, be just shifting jobs from the higher quality end of the market.

Indeed, if ASDA and Morrisons are more efficient in the usage of staff than other organisations (very likely) then more workers will be laid off e.g. many sole trader shopkeepers than new jobs created. However 1000 corner stores over the country each losing 2 or 3 staff do not in themselves make the news headline.

Is it just a case of an economic model, adopted by all world economies virtually, that depends on a slightly unreal assumption that world economies will grow perpetually and as soon as that fails we all go into "OMG what do we do now?" mode.

Those assumptions then get embodied into numerous computerised models and we all stop thinking; we just believe what the computer models tell us.

Surprise surprise; human societies don't behave like pieces of software and the adaptation of software is virtually always in response to actual events and hence lags reality.

This is an event that was bound to happen; let’s hope we can use our collective, and I stress collective, brain power and communications skills to develop and critically execute a plan that will develop a feasible workable model for the future of global economies.

A huge benefit that could potentially come out of this exercise is that we can plan on the basis of sustainable use of resources; may be this little depression will prevent us from heading towards a much bigger environmental catastrophe. A global slowdown must mean a reduction in consumption of global resources hence less use of Hydro-carbons and generation of CO2 and thus a big reduction in our individual and collective carbon footprints.

The drama queens on here don't know what hardship is; just remember "What doesn't kill you makes you stronger"

The other mantra that needs to be developed and adopted by everybody is one based on not blaming everybody apart from oneself. We have all been part of this experiment and seen the many benefits and most of those will remain.

Just look to see what we can do individually and collectively to improve the situation and act accordingly; it’s just too easy to blame everybody else and do nothing.

68. moraymint wrote:

"# 61 mysteriousfiona

You are joking ... aren't you?...Nothing personal at all, but comments like yours are, er, a tad naive to say the least"

I've left out the middle bit of your post which was,well, personal. More imortantly, I'd just make the comment that Fiona included a few facts to back up the point she was making. Your post # 59 was just a mindless rant. You took a couple of reports, ie FORECASTS, and asserted them as fact. I'll bet that you can't remember what either the IMF or IFS was forecasting the UK economy would grow at in 2008 this time last year. I think you'll find they were both wrong by a considerable margin. They may well be equally wrong about UK's economic performance in 2009.

By all means criticise GB if you're not happy with his performance. Few of us will have any real disagreements. But if you're going to criticise others on here with a view that doesn't fit your own, at least do them the courtesy of finding a few facts to back up your position.

Predict the worse and then be pleasantly surprised.....

A client of mine is a broker in the City and was predicting all of this over 2 years ago. I saw him this morning and he reckons the FTSE will end the year in the 5000-5500 range but will dip back again in 2010 following a premature surge. I asked about the housing market and he reckons prices will bottom at the year 2000 levels and then we just start again.

But we will survive and the good news is that we are unlikely to witness a period like this again in our lifetimes.

So come on people appreciate that we are part of history and we will be able to tell our children and grandchildren how any future downturn is nothing compared to 2009... and more importantly how we came through and prospered... and believe me WE WILL!!!

In the meantime - heads down, work hard and live according to your means . Caution but not panic.

This comment was removed because the moderators found it broke the house rules. Explain.

#61. mysteriousFiona wrote:

That we should all be more positive and talk things up. Unlike #68. Jan 2009, moraymint I have some sympathy with mysteriousFiona's view. I do not view it as a charming, but misguided expectation that being positive is a good thing in itself.

The sooner that we can talk up the economy; the sooner we can really see green shoots then we must talk it up.

However, even as an optimist myself, I am unable to find much to be cheerful about yet and I have been looking, except possibly that time has passed and the worst catastrophes have not yet happened. (Quite obviously I will not describe them here!)

I don't feel that those who we have charged with running things have much of a grip on events or of the data of past events. I want to see a complete refreshment of the professional personnel in the Bank of England, The Treasury and the FSA. I cannot accept that those 'skilled professional' who led us into this catastrophe are capable of so changing their mindset to be able to understand how to extract us from this mess.

It is not through a sense of justifiable vengeance, but it would make me even more optimistic if new untainted hands were on the regulatory tiller.

Regarding bank lending I contacted our bank manager this week and asked for details of the government backed loans for small businesses.

Apparently all home county and london managers were called together and told by their superiors they have to start lending to small businesses.

The scheme - 2% premium on interest paid to government who guarantee 75% of the loan. The bank has less risk so demands a higher interest rate. Lending is from £1,000 to £500,000 and the lending period can be up to 10 years.

He said "for a firm with a good credit rating you could be looking at 2.5% over base plus the 2% which today is 6%"

The manager asked me if he could contact 3 of my clients that he had turned down in recent months as he now thinks they can lend.

If you run a business and need help call your bank manager and ask about the Government Backed Loan Schemes.

RE: selling gold and foreign reserves. (all details courtesy of BoE which publishes the details in the 1st week of each month.)

THE RESERVES IN APRIL 1997
The overall level of the UK's official reserves rose by $552 million in April, bringing the end April reserves to $40,609 million (£25,029 million[1] ), compared with $40,057 million (£24,570 million[2] ) at the end of March.

Part I: UK Government Foreign Currency Assets and Liabilities – December 2008
1. UK Government net reserves rose by $1,534 million in December 2008, bringing the end-December
total to $28,022 million (£19,374 million1) compared with $26,487 million (£17,263 million2) at end-
November 2008.

It should be pointed out that reserves have been much lower than this, however. IN August 2007 the reserves were only $22 billion (£10.9 billion due to high exchange rate) and in 2002 they were even lower - $14 billion.

Something funny happened in March/ April 2000. I was not interested in the figires then but they are reported as:

Part I: UK Government Reserves - March 2000
1. The overall level of the UK Government's reserves, including the forward book, rose by $40 million in March, bringing the end-March total to $31,575 million (£19,794 million(1) ) compared with $31,535 million (£19,972 million(2) ) at the end of February 2000.

Part I: UK Government Foreign Currency Assets and Liabilities - April 2000
1. The UK Government's net reserves, fell by $41 million in April, bringing the end-April total to $13,643 million (£8,764 million(1)) compared with $13,684 million (£8,589 million(2)) at the end of March. 58/00 4 May 2000

So somewhere we seem to have lost $18 billion - a bit careless to my way of thinking.

robert,
what are we to do?
we could of cause continue with the existing model.
the rich remain rich or super-rich and the poor pay the price or we could attempt something DIFFERENT!

how about looking more closely at income.
the minimum wage is set at below poverty level.
large employers settle wage claims well below the cost of living, even staging pay rises across the year.
energy, water and food costs had been running at double digits and still are!.

the result the average family is surviving with no disposable income.
a recent survey in the south west of the u.k revealed that income there is 16k per annum but the "national average" is 26k

should employers be encouraged to increase pay particularly those who are benefiting from the current issues. or should they be allowed to target the long term unemployed pay them the minimum wage or just above and receive a government kick back for doing so.

20% of the population benefit 20% of the economy but the model we are following at the moment is expecting the top 20% to benefit 100% of the economy

What on EARTH is going on with the moderation. Lately?

2-3 hours at times to moderate posts.

Has the recession bitten Auntie and now the moderators lost their jobs?

Has someone made a divine gooey chocolate cake for tea breaks so all their fingers are too sticky to press the 'yes' button?

Are the moderators being retrained as car builders?

Or, for conspiracy theorists, is it all part of the masterplan to put a stop to possible insurrection by slowing it all down so much that noone bothers to post?

One last thing-

Alexander Curzon, it's SO GOOD to have you back! I've missed your direct, easy to read comments! Hope you're ok-was worried.

Tigs

Although things are clearly bad I still feel the gloom is being overdone. It is not the 1930s. We are not, unless I have missed something, about to engage in war with 10 million other Europeans. Total gov. borrowing at 57% of GDP (IFS) will not be unserviceable. The economy is much more flexible now than in the 70s, and more flexible than other majorEuropean economies. The one thing that will screw up recovery is lack of international co-ordination with some nations trying to free ride on fiscal stimulus of others or engaging in covert protectionism. The one thing that will prolong the recession in the UK is the return of a Conservative Government that, to avoid making tough decisions on current spending, cuts capital spending. The last 18 year period of Conservative Govt saw negligible public and infrastructure investment.

Shares up some again today-guess they were so cheap everyone's buying them!

I'm sure these gentleman of whom you speak, Robert, are esteemed within their fields, but forgive me, I find it very hard to trust what they say.

Frankly, any bigwig in finance I view with extreme suspicion.

The highest level players have bankrupted our country (even if the government doesn't know it yet). My children, and theirs (if they have any) have yet another dirty legacy to deal with.

That, in any language, is unforgivable.

I believe it is now necessary for New Labour to ask themselves questions on the errors of their policies which have led to this economic catastrophe. The IMF clearly stating that the UK is in the worst economic position of the developed world.

It must be clear to most, including New Labour that Gordon Brown's position is no longer tenable as Prime Minister. Is he not now far too synonymous with rising unemployment and falling sterling. In my view a first best move would be for New Labour to replace Gordon Brown with their best 'statesman' available. For what its worth my vote would be on Charles Clarke at the tiller for the rest of this parliament.

At this stage it does still all seem to be about perceptions and confidence. With that in mind I noticed a raft (why is it always a raft?) of new job announcements for the UK yesterday. Is it the case that such things are not normally reported and that the governement is doing all it can to increase confidence or am I just been cynical.

Robert,

I've just viewed the internet interview between you and George Soros in Davos.

Just for a little more cheeriness on this blog, I was struck by the similarity you have with David Tennant in his role as the 'Doctor'. Perhaps it was the scarf.

With a sonic screwdriver and a Tardis you'll know no bounds [or expense claims].

I seem unable to go for an honest chuckle; tainted by the last four months?

Oh, what the ...., if some of us laugh and smile it will spread to others. Humour and good feeling cost nothing.

Good luck to you and your respondants.

[Bloody Yank spell checker, I'm sure the correct word is 'respondant'. Mind you, I'm not a lawyer.].

N.

I have very little faith in the IMF forecast - their record doesn't stand scrutiny. If things are deteriorating more rapidly then their global predictions appear to be a tad optimistic for 2009.

As for the UK, who knows. Both we and the US at least appear to be ahead of the game in recognising that our current economic structure is no longer viable.

However, whilst I do not support GB's proposals I an sick and tired of the silly comments that our position would be improved by replacing him with either Clarke or Cable. Neither has the answer.

Re government loans?

Is it a case of 'computer says yes or no' still?

Not many businesses will have a 'good' credit rating as I doubt any lending criteria programs ignore performance on the last 4 months-you know, when banks started foreclosing on loans, overdrafts etc. Or when businesses have had default notices registered against them because of cash flow problems from customers taking longer to pay and suppliers demanding earlier and earlier settlement of bills.

Sorry to sound cynical, but until the rating agencies are sorted out or bank managers are given more ability to override the computers, credit of any kind is not going to flow well at all!

Credit should be scarce, but suppliers and customers should settle accounts in 30 days. Then there would be no need for some firms to require credit.

Trading needs to become honorable again. The giants should be fined massively for taking in excess of 100 days to pay, forcing discounts on settlements no matter how long they take to settle and negotiating costs down so low that suppliers are forced to operate at a loss.

Throw in a decent tax cut all round and a modest base rate rise and we'll all be laughing about this by the summer!

The icing would be investigations and prosecutions of the perpetrators of our misery.
Now then, which political party would do this I wonder?

How can anyone let alone economic experts or gurus qualify or quantify anything when the UK has items such as PFI and off balance sheet items?

Quite frankly these comments are as useful and as satisfying as p***ing into the wind!

This comment was removed because the moderators found it broke the house rules. Explain.

there's enough for all my need
but not for all the greed
we got investment
we got the asset
we have the income band
and all the outcome band
we have the sun and the rain now
we got the white clouds
and the sun in my eyes
too much money
you've got too much money

"mysteriousFiona wrote:
I would like you guys from the media to try and focus a little bit on the positive please!

For instance: Asda have created 1000 jobs as have BSkyB, i don't see you reporting on this. Our mortgages have gone down, of which i have fixed the rate for 2 years, yippee! and i have no intention of selling my house so i don't particularly care if it is worth ?30k less, as in 2 years it will probably be worth ?30k more :)

One of the reasons the economy is where it is now is the media focussing on the negatives and promoting a lack of confidence.

If you could look on the flip side and report on the positives, this will lift us all and raise everyone's moral."

mysteriousFiona are you actually aware of anything that's going on around you??? The reason we are in this mess is because of the global housing bubble whereby house prices rose well above their long-term trend related to affordability (The problem is worse in theis Country than moist others). I can assure you in a couple of years time your house will be worth another 30k less not more. I you bothered to do 2 minutes research on house price trends you would come to the conclusion that it will be at least 5 years before they reach bottom in real terms. If any government is to address the current problems they will need to raise interest rates within the time-frame you've mentioned. The reason the economy is the way it is is because of basic economics - too much debt, it has NOTHING to do with people talking down the economy.

This comment was removed because the moderators found it broke the house rules. Explain.

Soros and Roubini? Nah, they are probably only playing up their own books. It is not so much opinions as trying to whip up a more profitable sentiment.

Maxwell betrayed his workers and their future. He once said "You can trust me.".
Madoff swindled those who trusted him - includign friends of many decade. We don't really know who Soros and Roubini are, what they had in mind or what are the agenda. Likely to be another two devote, failthful worshippers of G.O.D (Gold. Oil. Dollas).

Over 40% of Wall Street bankers surveyed are not happy with their bonuses for 2008.
(source. Bloomberg).

Last week two hedge funds – RAB Special Situations and SRM Global Master Fund – claimed that the nationalisation of Northern Rock amounted to a violation of their right to "peaceful enjoyment of possessions" set out in the first protocol to the European convention on human rights.
(source. Guardian. 28 Jan 2009)

From Peston's blog on Davos, it seem the bankers and financiers are vey concerned about themselves and more about themselves.

What have some of these very well paid bankers done to us and to their business?

Since 1999 or during length of serviceThe following 7 bankers/financiers have received/taken a total renumeration of £977m. For the £977m, their businesses took a total credit crunch hits, since August 2007, of £404bn. It is like an emplyee on £20K losing the company £8.26m.
The names are :
Stan O’Neal, Merrill Lynch.
Jimmy Cayne, Bear Stearns.
Lloyd Blankfein, Goldman Sachs.
Dick Fuld, Lehman Bros.
Sandy Weill, Citigroup.
Hank Paulson, Goldman Sachs.
Chuck Prince, Citigroup.
(source - Guardian)

Do I believe what they say? Maybe, because they and their connections have enormous power to move things.

Do I trust their motives to be benevolent to all? Wait ... I just saw three glowing flying pigs.

New World Order indeed.

This is turning into a repeat of the 70s.

As Robert says, printing money has started already. The political cycle demands this remedy as it's the only thing that will work quick enough to get the incumbent re-elected.

But remember that in the 1970's there were years of inflationary turmoil - a sort of Methadone treatment when coming off Heroin. The belief is that to go 'Cold Turkey' will kill the patient. This eventualy happens when the desperate population elect someone like Thatcher.

So the sum total of pain is actually more, but it is diluted over time. Both the innocent and guilty suffer.

Let's say Cameron gets a majority of 120. He could go the Thatcher route and get us on our feet much quicker since he has 5 years to do it.

1. Massive cuts in Public Spending.
2. Public workers to retire at 70.
3. Prison places to go to 250k with chain gangs.

Naturally, he wont because circumstances dictate he will be playing the Ted Heath role this time round...

@71:
"7 Do away with the Circus that is PMQ and have him or her answer questions from the public , in a different city televised every week"

Great idea! I wish your ideas could be put into action immediately.

But do you have any suggestions on how to get rid of the pitiful lot in charge?