Politics

[Dubz]

I've just had a debate with a guy that advises the Arab banks on how to use their money and I thought that this forum was missing a thread on the current government monetary and fiscal policies.

How do you think the current government should spend/save it money with the double dip recession that's currently happening within the UK?

(extra note I was destroyed in this debate + this was written with 10+ pint in the system. Sorry for errors)

 

[Ollie133cup]

Not much too say but , i believe this goverment are doing a decent job . We have to struggle for a few years so we can get out of this **** that Labour has got us into!

My only issue is not cutting fuel prices to increase spendin in other areas.

 

[gavin-h]

Not much too say but , i believe this goverment are doing a decent job . We have to struggle for a few years so we can get out of this s**t that Labour has got us into!

My only issue is not cutting fuel prices to increase spendin in other areas.

Agree on all counts. Vote for Ollie!!!

 

[Araf]

Not sure it's that simple. The banks are being baled out, yet they don't seem to be passing it on.

Also, you know how everything seems to be getting more expensive? That's quantitive easing for you.

Labour spent all the money again (just like they did before '79), and created more laws than any previous governtment, and for what? Unfortunately the current government doesn't have the b@lls to make the necessary cuts to balance the books.

 

[Dubz]

Also, you know how everything seems to be getting more expensive? That's quantitive easing for you.

Sorry but this is incorrect.

If the average price of goods is increasing that's inflation. In the case that quantitive easing leads to inflation is taking the monetarist route of using the fisher equation MV=PT which is incorrect. Quantitive easing may lead to inflation but there are so many external factors that cause inflation it would be near impossible to determine that there is a direct relationship.

[/economics lesson]

Labour spent all the money again (just like they did before '79), and created more laws than any previous governtment, and for what? Unfortunately the current government doesn't have the b@lls to make the necessary cuts to balance the books.

I think it's the longest period of economic growth ever recorded in the UK.

Oh look it's the tori's causing more inequality, larger income distribution gap and lastly the longest period of economic negation growth

(I just like arguing anything to do with economics)

 

[singlespeed]

was that truly sustainable growth, or bought on the never never with non existant money?

 

[Araf]

Also, you know how everything seems to be getting more expensive? That's quantitive easing for you.

Sorry but this is incorrect.

If the average price of goods is increasing that's inflation. In the case that quantitive easing leads to inflation is taking the monetarist route of using the fisher equation MV=PT which is incorrect. Quantitive easing may lead to inflation but there are so many external factors that cause inflation it would be near impossible to determine that there is a direct relationship.

[/economics lesson]

Devaluing the currency by increasing the amount in circulation is a proven route to inflation. Quantitive easing is just a nice way of saying it, and the result is no different from the devaluation that happened in the 70's. People remember that what Wilson said in his "The pound in your pocket" speech led to higher prices, so politicians can't use the 'D' word for what they are doing. In order to keep the headline inflation percentage low, key parts of a family's monthly expenditure are left out of the official figures - often on the grounds of seasonal volatility, when the underlying trend of these is a much larger increase than the official inflation rate.

Labour spent all the money again (just like they did before '79), and created more laws than any previous governtment, and for what? Unfortunately the current government doesn't have the b@lls to make the necessary cuts to balance the books.

I think it's the longest period of economic growth ever recorded in the UK.

Oh look it's the tori's causing more inequality, larger income distribution gap and lastly the longest period of economic negation growth

(I just like arguing anything to do with economics)

The inequality has little to do with any political party, and more to do with the type of people in government, big business, and the media. People have been trousering big pay packets for 20 years, and successive governments and shareholders have done nothing about it - probably because they had sufficient themselves at the time. It's only when the masses are feeling the pinch (which you say is NOT due to quantitive easing) that they realise how much is being taken by those running the companies. As for the economic growth, at what expense? I've seen the wheels falling off this wagon since 2003, but cheap imports and easy money postponed the inevitable, and has made the resultant recession as bad as it is.

You talk about the largest income gap now, but I think you'll find that it was a lot bigger in the 19th Century. The difference is that those that had the money then were philanthropic, whereas now the greedy bastids salt it away off-shore.

(I'm enjoying this too )

 

[Dubz]

was that truly sustainable growth, or bought on the never never with non existant money?

You know that it's wasn't truly sustainable growth by the fact it ended

A fair amount of that extra money was spent on capital expenditure which is a form of increasing the chance of long run growth.

The biggest economic question is can you really get sustainable economic growth? And if you can how do you do it?

I can't answer them. But the way the current government is going about it could I'm my mind could be made better.

Using there A grade rating and apply browns golden rule (and keep to it) spend in a recession, finance it in the period of growth. However due to globalisation and interdepence on other countries it's much harder said than done as everyone would have to do similar things.

Education is where the money needs to be. But the issue with spending money on education is the rate of return is very low. However would be benefit the country in the long run due to many people being trained better so they can do more skilled job and/or do their jobs more efficiently thus more money being generated for less(productive efficiency)

So in my opinion education would be the best bet to get close to sustainable growth which labour spent money on and where the tori's (lib dems don't really have much say in the government) have cut back massively.

Just like writing an economics essay

I'm done for the night.

Just seen araf has posted something good. Will have a look in the morning