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Lettuce Liz then Tetchy Rish! and the battle to replace him

Paddingtonwolf said:
Seriously? The entire global economy is based on balances. An important part of those balances is the intention to pay back. If it’s government borrows enormous sums from the BoE with no intention of paying back its credit rating will be enormously damaged. This will effect the value of gilts as they will be viewed as a less safe haven if the government has defaulted on other borrowing.

The overall value of sterling on the planet is in balance with the overall value of other currencies on the planet. You suddenly ask BoE to print hundreds and hundreds of billions to have as the government party pot, then the balance is upset. To avoid this, the value of Sterling against every other currency falls. So your pound now buys you less.

In addition the value of every single company quoted on the London stock exchange falls by the equivalent of the collapse of sterling. These companies aren’t going to actually be very happy about that and neither are all the funds invested in them. So share prices have to actually go up to redress the balance. So your sterling buys you even less.

And as the pound falls the cost of everything in the shops rises. To try and avoid starvation wages have to rise. Causing a further massive inflationary pressure.

Next stop wheelbarrow of notes to buy an egg.
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The govt isn't 'borrowing' anything though, it's creating.
 
But you can't do that without devaluing every other currency on earth. So your currency price collapses. It's basic economics.
 
Paddingtonwolf said:
But you can't do that without devaluing every other currency on earth. So your currency price collapses. It's basic economics.
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I think that is too simplistic rather than basic. Inflation devalues currency so anything that would create further inflationary pressure would not be a particularly good move. Truss tried this by creating inflationary pressures on the promise of growth with nothing to back it up. Increased demand (more money) without increased supply is inflationary. “Printing money“ in the absence of an increase in output will just see those who manufacture increase their price but without an increase in what they supply.

It is slightly different when it comes to “printing money” to spend/invest in areas of the economy that don’t have a direct output or product…like many public services. We have been conditioned to believe that debt is bad, despite always being in debt…that we have to spend within our means despite the fact we rarely spend within our means. The real term cuts to public sector spending, now and over the last 12 years, are political choices not economic ones. We could choose to borrow our way out (or print money) of this crisis but we believe what we’re told. Unfortunately, there is another crisis lurking - whether it is next year or in 10 years time…and the last few years have exposed how fragile our economy is after the GFC on 2008, Brexit in 2016 and Covid. What the government is doing isn’t fixing anything, it is embedding inequality and that fragility even more.

Politically and economically. We could “print” £35 billion and not cut back public services, maybe invest in public services to make them fit for purpose…but neither of the two political parties are willing to consider that for political reasons, not economic.
 
The Saturday Boy said:
I think that is too simplistic rather than basic. Inflation devalues currency so anything that would create further inflationary pressure would not be a particularly good move. Truss tried this by creating inflationary pressures on the promise of growth with nothing to back it up. Increased demand (more money) without increased supply is inflationary. “Printing money“ in the absence of an increase in output will just see those who manufacture increase their price but without an increase in what they supply.

It is slightly different when it comes to “printing money” to spend/invest in areas of the economy that don’t have a direct output or product…like many public services. We have been conditioned to believe that debt is bad, despite always being in debt…that we have to spend within our means despite the fact we rarely spend within our means. The real term cuts to public sector spending, now and over the last 12 years, are political choices not economic ones. We could choose to borrow our way out (or print money) of this crisis but we believe what we’re told. Unfortunately, there is another crisis lurking - whether it is next year or in 10 years time…and the last few years have exposed how fragile our economy is after the GFC on 2008, Brexit in 2016 and Covid. What the government is doing isn’t fixing anything, it is embedding inequality and that fragility even more.

Politically and economically. We could “print” £35 billion and not cut back public services, maybe invest in public services to make them fit for purpose…but neither of the two political parties are willing to consider that for political reasons, not economic.
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By investment do you mean infrastructure?

If, for example, we borrowed to build solar panels on every government, social and new building along with batteries and off shore wind provision then yes I'd agree with you as we're borrowing to solve a crisis.

To borrow to increase wages in the public sector would result in inflationary pressures and collapsing economy as Paddy points out.
 
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Johnny75 said:
By investment do you mean infrastructure?

If, for example, we borrowed to build put solar panels on every government, social and new building along with batteries and off shore wind provision then yes I'd agree with you as we're borrowing to solve a crisis.

To borrow to increase wages in the public sector would result in inflationary pressures and collapsing economy as Paddy points out.
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That does depend n what you consider to be appropriate to invest in staff - if there is a recruitment and/or retention issue that could be alleviated by increasing wages then that would be appropriate as there is little to be gained in investing in infrastructure if there is nobody to work in the public sector.

We rely heavily on social care but there are ever decreasing numbers of social care staff which means we have a budget for our son we can’t spend because neither we or the organisations we use can’t recruit social care workers. Staff are also part of the infrastructure and pay that matches the current rate of inflation would not be inflationary, then a planned overhaul of public sector pay where justified would address the staffing issues.
 
The Saturday Boy said:
That does depend n what you consider to be appropriate to invest in staff - if there is a recruitment and/or retention issue that could be alleviated by increasing wages then that would be appropriate as there is little to be gained in investing in infrastructure if there is nobody to work in the public sector.

We rely heavily on social care but there are ever decreasing numbers of social care staff which means we have a budget for our son we can’t spend because neither we or the organisations we use can’t recruit social care workers. Staff are also part of the infrastructure and pay that matches the current rate of inflation would not be inflationary, then a planned overhaul of public sector pay where justified would address the staffing issues.
Click to expand...
To go back to the original point, borrowing huge sums of money from the bank or printing money to solve this would result in huge inflationary pressures and risk collapsing the economy.

Government should never borrow for wages or tax cuts.
 
https://www.bbc.co.uk/news/business-63704841

bookmark this for whenever vcky ford or any other liar waffles about record investment in, or any other bullcrap that we're better than the rest.
In the G7, we are singularly worse off, and with a worse economy than anyone, FACT.
There are 2 distinct differences between us and the rest of the G7. Truss/Kwartengs 4 week car crash, and brexit. Both undeniably tory policies. Simply put, the tories are making every single one of us poorer, with less safety nets, and with worse quality public services.
 
She understood the question. She didn't want to have to answer it.
 
Isn't it easier for them to go straight to Rwanda..?
 
I expect the Daily Mail coverage of that moment to be - " Woke Tory MP pretends to be a 16 year old African girl"
 
Still too busy exploding over a possibility of a soft Brexit while publishing photos of a filthy rich family having a banquet when there are queues at food banks.
 
Raab seems to be under siege, with new bullying allegations/complaints, and also new complaints he used his personal email for official govt business.

In other news, and I note @Johnny75 mentions Gove did some car crash interviews this morning, he seemed to love wading in to the debate on the sad death of Awaab Ishak and courting the publicity.

So where is he bleating about the hundreds, if not thousands of preventable deaths happening WEEKLY because of his onw governments decisions?
https://www.bbc.co.uk/news/health-63743383
 
A few rumblings Hunt will be replaced in the new year as he is being blamed for the Swiss type deal idea with the EU that has woke up the ERG
 
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