Labour ?

...and Jeremy Hunt is still Health Secretary.

Give me strength

Bruce Woodhouse posted:

...and Jeremy Hunt is still Health Secretary.

Give me strength

You'll need it as the health service won't be able to help you when you are feeling under the weather soon...

To me just another sign that she has her own interests and "business as usual" in mind more than healing the country!

It's always hard for the stupid to learn from their mistakes. 

Happy Listener posted:

 

For me (like you), next time (head drops at this thought) I'd like to see fuller presentation from the main parties on the economics and fiscal management piece i.e. for McDonnell and Corbyn to explain in detail (not just using the tag 'costed') what is the extent of spending proposed and how they will get the deficit removed (this just isn't sustainable), and what assumptions & risks underpin this. Equally, the Tories need to explain their plans outside of the Budgets -  TM was very weak on this when questioned, citing that people should be aware of this per the Budgets, which left the Tories wide open to Labour's stated plans and the benefits which would accrue.

I know you will disagree ... but the UK debt isn't anywhere close to unsustainable.  Its only is we approach interest payments being something like 12% of GDP that the debt would be unsustainable.  What is unsustainable is to continue increasing the debt without actually investing in anything for the future.

I was at an event (defence related) yesterday and sat at lunch with representatives from the Polish and Slovakian Embassies.  They both pointed out that UK doesn't realise what austerity is, we have a functional and excellent NHS - yes there are waiting lists and pressures but try their countries for size, far more EU residents want to come to UK than leave, and even post Brexit are intent on staying, and there are excellent employment opportunities.   If you wish to see deprivation and poverty visit parts of Warsaw.  Similarly, I was recently in Paris - the number of homeless people begging surprised me given that they were just emerging from 4 years of socialist Corbyn like nirvana.

If by chance we have another election and elect Labour under a Corbyn manifesto it will be the biggest economic catastrophe to befall this country since 1945. 

In your opinion.

Indeed.

Or, we could keep the tories in power, go for a hard brexit and end up with the biggest economic catastrophe since 1945.

The DUP say they will use their increased influence responsibly. This can ONLY be interpreted one way. The won't be propping up the Tories.

Cdb posted:

Mike-B posted:

As someone who lived those times I agree the thinking behind OW's post.   Salutary lesson?  no thanks !!!!       But it won't be needed this time anyway,  I see the polls published this evening all show a widening of the con/lab gap,  even YouGov using their new method who have consistently shown lab closer to con than the all pollster average, tonite have them at 42 to 35 with lab -3 since their last poll.

Not sure what times you or OW are referring to - perhaps the time of radical change, greater equality and hope of the Attlee government? 

Clive

Hi Cdb,

No, more the abuse of union power - one end of the stick with the abuse of the financial system at the other.

Cheers,

OW

---

As before, May has to deal with both Brexit sides of her party.

Sturgeon needs to put Indyref2 on a lower shelf and concentrate on running the country.

Corbyn and Momentum have cemented their takeover of the Labour party - the main objective. Defeat for the so called moderates - do they stay or up sticks?

Labour take a 40% share but only manage to be 56 seats behind the Conservatives. Another surge required. Will they achieve it as the gloss on I'm With Jeremy weathers?

fatcat posted:

Or, we could keep the tories in power, go for a hard brexit and end up with the biggest economic catastrophe since 1945.

Be sure of one thing Jeremy Corbyn  supports Brexit because he favours an independent socialist republic.  He's always been clear on that.  The only reason constitutional reform was absence from the Labour manifesto was because he knew it would be deeply unpopular.

The Strat (Fender) posted:

fatcat posted:

Or, we could keep the tories in power, go for a hard brexit and end up with the biggest economic catastrophe since 1945.

Be sure of one thing Jeremy Corbyn  supports Brexit because he favours an independent socialist republic.  He's always been clear on that.  The only reason constitutional reform was absence from the Labour manifesto was because he knew it would be deeply unpopular.

Or to put it another way... he is the democratic leader of a Democratic Party who believes in democracy so will compromise for the good of the party / country. 

Eloise posted:

The Strat (Fender) posted:

fatcat posted:

Or, we could keep the tories in power, go for a hard brexit and end up with the biggest economic catastrophe since 1945.

Be sure of one thing Jeremy Corbyn  supports Brexit because he favours an independent socialist republic.  He's always been clear on that.  The only reason constitutional reform was absence from the Labour manifesto was because he knew it would be deeply unpopular.

Or to put it another way... he is the democratic leader of a Democratic Party who believes in democracy so will compromise for the good of the party / country. 

Or is he just another politician who dealt out a pocket full of promises and assurances in a very sincere and  magnaminous style which appeals to the people.  He has not yet been tested but he knows how to seduce certain parts of the population and he seems to play the percentage game.

Eloise posted:

Happy Listener posted:

 

For me (like you), next time (head drops at this thought) I'd like to see fuller presentation from the main parties on the economics and fiscal management piece i.e. for McDonnell and Corbyn to explain in detail (not just using the tag 'costed') what is the extent of spending proposed and how they will get the deficit removed (this just isn't sustainable), and what assumptions & risks underpin this. Equally, the Tories need to explain their plans outside of the Budgets -  TM was very weak on this when questioned, citing that people should be aware of this per the Budgets, which left the Tories wide open to Labour's stated plans and the benefits which would accrue.

I know you will disagree ... but the UK debt isn't anywhere close to unsustainable.  Its only is we approach interest payments being something like 12% of GDP that the debt would be unsustainable.  What is unsustainable is to continue increasing the debt without actually investing in anything for the future.

Eloise - I think I am correct to say that JC stated the deficit (not sure if defined as against RevEx alone i.e. ex-'Growth Spending') would, per Labour's forecasts, be removed by the end of the Parliament (or c.2025?) - this is an aspect in the plans I'd like to understand more. At face, this looks highly ambitious if the case.

For me it's all in the maths and underlying risks. And, yes, I don't subscribe to the notion that hocking UK plc via a material increase in National Debt involving interest payments alone at 12% of GDP is wise. We are/could well be in an economic time, when all previous economic theories are blown away - only the history books will tell the tale.

My experience in the wider commercial space is that the numerator/denominator relationships around debt ratios can change very swiftly (often due to unexpected events - existential if you will), which engenders the need for absolute focus on debt management and carry costs (enforced austerity, increased taxes, uncompetitive economy to others - all sound familiar?). Things can spiral downwards very quickly - and any over-spending creates a 2x multiplier i.e. you cannot add to debt and we now need to reduce it.

I'm not sold on the (Keynesian theory backed) 'Growth spending' plans - Keynes' theory also involved governments targeting surpluses to restore their spending firepower on the upswing. He was not an advocate of running continual deficits. History shows such things often aren't effective or the delivery cannot be validated (e.g. FDR's New Deal in retrospective analysis) - again, something to be understood and interrogated, rather than just being swayed by sound-bites. As to the privatisation agenda (likely cost >£200bn), let's not go there. Bottom line, IMV UK plc could become a 'zombie economy' if we don't get maintain a grip on the fiscal position.  

The UK's credit rating is already on 'watch' (which means downside evaluation and increased borrowing costs) and we have various challenges before us which require dealing with e.g. the potential costs and implications of Brexit, a very hungry mouth in the NHS (driven by demand-side factors), unresolved social care funding arrangements, to name but some - and there are arguments that QE (money printing in simple terms) is no longer a realistic part of the armoury for the BoE in counteracting a recession. We could well see the BoE's inflation management role tested if the exchange rate continues to soften, with further input (import) driven inflation. Of course, atypically, internal I/rates are raised to protect a currency in such a scenario but it appears this would simply add fuel to the inflation fire, and internal borrowing costs. The BoE/Carney have been silent around such a scenario - understandably so.

I am not politically affiliated - I just want to see the truth of the maths and the underlying risks. At the moment, all I'm detecting are potential downside aspects, which support the general approach of the Tories i.e. trying to keep us in the amber zone rather than increasing spending commitments against what appear to be uncertain balancing tax rev's (at best), and setting us on a potential course to the red zone (or testing our UK plc O/D limit). Neither approach is welcome  -  but we gotta face it, UK plc isn't in financial clover.

BTW, I accept and am very open to the idea that NHS funding needs should be found from an increase in general taxation (which must be a sustainable income structure and not a 'raid' on the top 5% or alike - which may not yield as much as expected). But before this is further considered/enacted, I would want to understand what the NHS's forecast needs are for Y2/Y3/Y5 onwards etc, plus what allowance is being built in for an upward adjustment in staffing and remuneration levels (Unison would leverage a Labour Govt. for sure). I fear the NHS is an insatiable costs monster (as it now sits) and a longer term plan needs to be set down (operational and financial, including funding - staffing costs post Brexit??), to ensure it can be fit for purpose in the future. Tory statements around real increases in funding are for me very shallow when the demand-side issues are so profound. Put another way, I don't subscribe to just chucking an uncertain amount of money (especially if part borrowed in concept) at a problem. We need to recognise what the real operating cost need of the NHS is in delivering to its state charter, as it seems it is some way > current funding level - and deal with it.

Interesting times.

HL.

Don't you have any good news, that’s enough to make a quite few forum members suicidal.

fatcat posted:

Or, we could keep the tories in power, go for a hard brexit and end up with the biggest economic catastrophe since 1945.

We're heading for that anyway but who is to blame?  

The idiots who voted for Brexit.

The catastrophe is brewing nicely. Nothing to do with brexit. 

Hungryhalibut posted:

The idiots who voted for Brexit.

Well then as I said go and talk to Jeremy Corbyn - voted leave in 75, supported leave in 83, resisted the Single European Act, voted against Lisbon and Marstrict.  And then last year he was at best lacklustre.  I'll give the benefit of the doubt and assume he voted Remain - it has been suggested otherwise - but I can't help but feel that Brexit is working to his advantage.  

And dare I say that you dismissing all those who voted Leave as idiots pretty much says it all.  Go figure.  

Worth keeping some perspective about the UK's deficient, least people think we're on the point of calling in the receivers. Last year, 2016/17, the interest on the UK's debt was about £39 billion. A large number, I grant you, but the total government income for that year was over £716 billion.  So the interest represents less than 6%.  

I know the UK's debt is sometimes compared (mistakenly, IMV) to household debt. But on that basis I think most people with a mortgage would live with interest payments of that level.  And when I last looked the accumulated deficit was about £1.7tn i.e. less than 2.5 times the total annual income. Again, in household mortgage terms, hardly 'over-leveraged'.   

The weak pound is good for the UK HiFi manufacturers, the can sell there products for less abroad?

djh1697 posted:

The weak pound is good for the UK HiFi manufacturers, the can sell there products for less abroad?

Except the raw materials cost the UK manufacturers more ... so while there is a small benefit in exports it's quite balanced.  If there starts to be tariffs applied and customs inspections, then things will get worse. (Brexit related rather than current situation of course).

MDS posted:

Worth keeping some perspective about the UK's deficient, least people think we're on the point of calling in the receivers. Last year, 2016/17, the interest on the UK's debt was about £39 billion. A large number, I grant you, but the total government income for that year was over £716 billion.  So the interest represents less than 6%.  

I know the UK's debt is sometimes compared (mistakenly, IMV) to household debt. But on that basis I think most people with a mortgage would live with interest payments of that level.  And when I last looked the accumulated deficit was about £1.7tn i.e. less than 2.5 times the total annual income. Again, in household mortgage terms, hardly 'over-leveraged'.   

MDS - agree, we look to be in the comfortable zone (IMV we need to retain UK plc debt capacity headroom for the unknown unknowns). One of the issues around the deficit has been its structural nature i.e. the reasons we have needed to borrow and how these sit on a through the cycle basis.

The ratings/markets look at debt:GDP as a key marker and this has grown from ~50% in 2008 to 89% close 2016. In ratings-land, I think there is a scorecard threshold of 100% of GDP (could be 90%). The USA sits above 100%, as does Japan - and we're not alone at being ~89% (Greece is well >100% and Italy over 100%). A key test is outlook and the perceived strength of the economy.

We mustn't forget that slipping a further ratings notch wouldn't only impact I/costs and investor appetites but also the global station of Sterling as a reference currency, with likely material implications for our exchange rates.

Never mind the deficit, it's the Maybot's political antennae that are deficient. 

Drewy posted:

The catastrophe is brewing nicely. Nothing to do with brexit. 

Perhaps you'd better explain?

Moody's downgraded Britain's rating from AAA the day after the referendum, and has stated that "the UK's  medium term outlook is weaker than it would have been had Britain voted to remain part of the EU".

It has also stated that our national credit rating might be downgraded again if the Government fails to retain access to the single market as part of its Brexit negotiations.

Just one ratings agency, but a major player in the market -  definitely something to do with Brexit!