The Budget 2013 thread

[pap]

Trust me they don't stop costing you just because they are adults.

 

Yeah, I've been told that by loads of people.

 

Looking forward to it

[LGTL]

I wouldn't have been able to have done bugger all without the help of my parents. I'm also having to rely on a pretty hefty inheritance from grandparents for my first deposit on a house. I'm one of the "lucky" ones but I still find myself with massive student debt, but luckily a good career thanks to the bank of mum and dad.

[Chez]

What I meant was that people who have a high equity in their property are likely to leave this to their offspring ! As the average house price is currently £238k and the percentage of homeowners is around 65% that means that many of the upcoming generation will inherit a lot more than their predecessors !

You may disagree but that was my point !

 

I wouldn't spend it before they die though as the cost of care and inheritance tax will see much of that value disappear.

 

Personally, if I inherited all of my Dad's civil service pension I'd be much happier.

[CHAPEL END CHARLIE]

The Labour Parties response to the last weeks Budget Statement, indeed the entire approach they have adopted to the severe economic problems the country is facing, is a cynical nonsense. You don't have to possess a masters degree in economics to know that you just can't borrow and spend your way out of our enormous debt and deficit problems - that way surely leads to ruin.

 

By offering oh-so-easy answers to what are in truth massively difficult problems they may win the support of the gullible, or those who just can't face up to the hard truth that the road we are on is long and painful one. However I believe in the long run the British people won't tolerate being treated as if they were a bunch of ignorant children and Labour will sacrifice any slim chance they might have had of restoring their tattered economic reputation. The inevitable consequence of that is that they will lose the next election decisively I both trust and believe.

 

And that fate will be exactly the outcome they so richly deserve.

[saintfully]

The Labour Parties response to the last weeks Budget Statement, indeed the entire approach they have adopted to the severe economic problems the country is facing, is a cynical nonsense. You don't have to possess a masters degree in economics to know that you just can't borrow and spend your way out of our enormous debt and deficit problems - that way surely leads to ruin.

 

By offering oh-so-easy answers to what are in truth massively difficult problems they may win the support of the gullible, or those who just can't face up to the hard truth that the road we are on is long and painful one. However I believe in the long run the British people won't tolerate being treated as if they were a bunch of ignorant children and Labour will sacrifice any slim chance they might have had of restoring their tattered economic reputation. The inevitable consequence of that is that they will lose the next election decisively I both trust and believe.

 

And that fate will be exactly the outcome they so richly deserve.

 

Hahahahahahahahahaha - explain to me exactly how much the national debt will be in 2015? (double 2010) How much the deficit will have been reduced by? (only ~20%) Why its reduction has stalled now? (no growth).

 

'You don't need a masters degree in economics to know that'... cutting during the downward part of the economic cycle stunts recovery and growth. Since you insist on reducing international economics to that of a household... lets think about this: who is going to pay off their £10,000 debt quicker? The house that scrimps and saves an extra £100 a month, or the house that invests £1000 to boost their income by £3000?

[CHAPEL END CHARLIE]

Hahahahahahahahahaha - explain to me exactly how much the national debt will be in 2015? (double 2010) How much the deficit will have been reduced by? (only ~20%) Why its reduction has stalled now? (no growth).

 

'You don't need a masters degree in economics to know that'... cutting during the downward part of the economic cycle stunts recovery and growth. Since you insist on reducing international economics to that of a household... lets think about this: who is going to pay off their £10,000 debt quicker? The house that scrimps and saves an extra £100 a month, or the house that invests £1000 to boost their income by £3000?

 

Two questions: Do you run your own personal finances on this lunatic basis, and if you do, are you still remotely solvent?

 

So the government increases the national debt from todays already crippling level to something utterly astronomical in the hope that this will lead to more sustained growth in future. This is of course effectively betting the economic prosperity of this nation, not just for a few years, but for generations to come on that mad gamble paying off. And if doesn't work ... well we're just screwed like Greece and Cyprus are then aren't we?

 

Let's put to one side for the moment the negative impact that massive level of additional borrowing will have on interest rates, inflation, and on our already degraded credit rating and consider instead the record of how wisely Ed Balls and his mates have managed our money in the recent past ... err not a very promising prospect is it?

 

No, I say the wise man bewares politicians who choose to peddle easy answers. The only way out of this mess is not to inflate further the national debt and state spending, but rather to cut debt and control spending to the best of our ability. Above all it is imperative that we continue to reduce the share of GDP that government is responsible for - a metric that is a sure indicator of most successful high growth economies.

 

This nonsensical 'lets spend our way out of debt' scheme the Labour Party and you advocate is a load of Balls frankly.

[saintfully]

Two questions: Do you run your own personal finances on this lunatic basis, and if you do, are you still remotely solvent?

 

So the government increases the national debt from todays already crippling level to something utterly astronomical in the hope that this will lead to more sustained growth in future. This is of course effectively betting the economic prosperity of this nation, not just for a few years, but for generations to come on that mad gamble paying off. And if doesn't work ... well we're just screwed like Greece and Cyprus are then aren't we?

 

Let's put to one side for the moment the negative impact that massive level of additional borrowing will have on interest rates, inflation, and on our already degraded credit rating and consider instead the record of how wisely Ed Balls and his mates have managed our money in the recent past ... err not a very promising prospect is it?

 

No, I say the wise man bewares politicians who choose to peddle easy answers. The only way out of this mess is not to inflate further the national debt and state spending, but rather to cut debt and control spending to the best of our ability. Above all it is imperative that we continue to reduce the share of GDP that government is responsible for - a metric that is a sure indicator of most successful high growth economies.

 

This nonsensical 'lets spend our way out of debt' scheme the Labour Party and you advocate is a load of Balls frankly.

 

'Frankly', I'm embaressed for you.

 

Firstly, 'Yes' and 'very solvent, thank you'. I took the decision to invest in my future income by going to University and doing a technical degree. That's enabled me to earn much more money than I would have done without it. Hope that wasn't too complicated to follow.

 

On to your other genius points:

i) We can never be screwed like Greece and Cyprus because we can print our own money and devalue our currency if necessary (oh, and it was Labour who kept us out of the EU). In fact, it is this govts policy - just restated in the budget - to continue with a devaluation of the pound via QE and high inflation, just like over the last three years. BUT anyway, even Labour aren't advocating that we just borrow, borrow and borrow again - rather, just enough to stimulate the economy and inject some demand. Erm, a bit like Georges new wheeze whereby the govt commit £130 billion of your money to back private mortgages - which is a stimulus, but a crap one.

ii) (Bored now). Balls past record. Erm, look at Osbornes. Hate to say it, but they're all crap - I'm only interested in the policy that is most likely to prevent UK from languishing like Japan for the next 10 years. IMHO, thats slightly more likely to be Labour strategy.

iii). If you increase size of GDP by growth of private sector, % of govt spend decreases. The trick is to rebalance economy without destroying it - eg. by reflating housing bubble.

 

I don't think you know what you're talking about. R U pis.sed at sunday lunchtime???

[solentstars]

'Frankly', I'm embaressed for you.

 

Firstly, 'Yes' and 'very solvent, thank you'. I took the decision to invest in my future income by going to University and doing a technical degree. That's enabled me to earn much more money than I would have done without it. Hope that wasn't too complicated to follow.

 

On to your other genius points:

i) We can never be screwed like Greece and Cyprus because we can print our own money and devalue our currency if necessary (oh, and it was Labour who kept us out of the EU). In fact, it is this govts policy - just restated in the budget - to continue with a devaluation of the pound via QE and high inflation, just like over the last three years. BUT anyway, even Labour aren't advocating that we just borrow, borrow and borrow again - rather, just enough to stimulate the economy and inject some demand. Erm, a bit like Georges new wheeze whereby the govt commit £130 billion of your money to back private mortgages - which is a stimulus, but a crap one.

ii) (Bored now). Balls past record. Erm, look at Osbornes. Hate to say it, but they're all crap - I'm only interested in the policy that is most likely to prevent UK from languishing like Japan for the next 10 years. IMHO, thats slightly more likely to be Labour strategy.

iii). If you increase size of GDP by growth of private sector, % of govt spend decreases. The trick is to rebalance economy without destroying it - eg. by reflating housing bubble.

 

I don't think you know what you're talking about. R U pis.sed at sunday lunchtime???

 

Agree with you on that

 

Sent from my Nexus 4 using Tapatalk 2

[Jonnyboy]

Exactly, it's not an either/or situation, labour have always said they'd do cuts, but cuts alone won't fix it. Neither will making the average pint 3p cheaper.

[Whitey Grandad]

You can't cut borrowing by borrowing more. Labour always used the term 'investment' when they were talking about increasing spending on public services when they should have said 'subsidy'.

[saintfully]

You can't cut borrowing by borrowing more. Labour always used the term 'investment' when they were talking about increasing spending on public services when they should have said 'subsidy'.

 

Again, the logic of the simpleton.

 

You can cut borrowing if you borrow to buy something that ends up being worth more than you borrowed when you sell it. If you can't understand that then you are an imbecile.

[oracle saint]

For those undecided whether to go with the Keynsian or Chicago schools of economic thought this could make the decision much simpler.

 

THE TAX SYSTEM EXPLAINED IN BEER

 

Suppose that once a week, ten men go out for beer and the bill for all ten

comes to £100.

 

If they paid their bill the way we pay our taxes, it would go something like

this..

 

The first four men (the poorest) would pay nothing.

The fifth would pay £1.

The sixth would pay £3.

The seventh would pay £7.

The eighth would pay £12.

The ninth would pay £18

And the tenth man (the richest) would pay £59.

 

So, that's what they decided to do.

 

The ten men drank in the bar every week and seemed quite happy with the

arrangement until, one day, the owner caused them a little problem. "Since

you are all such good customers," he said, "I'm going to reduce the cost of

your weekly beer by £20." Drinks for the ten men would now cost just £80.

 

The group still wanted to pay their bill the way we pay our taxes. So the

first four men were unaffected. They would still drink for free but what

about the other six men? The paying customers? How could they divide the £20

windfall so that everyone would get his fair share? They realized that £20

divided by six is £3.33 but if they subtracted that from everybody's share

then not only would the first four men still be drinking for free but the

fifth and sixth man would each end up being paid to drink his beer.

 

So, the bar owner suggested that it would be fairer to reduce each man's

bill by a higher percentage. They decided to follow the principle of the tax

system they had been using and he proceeded to work out the amounts he

suggested that each should now pay.

 

And so, the fifth man, like the first four, now paid nothing (a 100%

saving).

The sixth man now paid £2 instead of £3 (a 33% saving).

The seventh man now paid £5 instead of £7 (a 28% saving).

The eighth man now paid £9 instead of £12 (a 25% saving).

The ninth man now paid £14 instead of £18 (a 22% saving).

And the tenth man now paid £49 instead of £59 (a 16% saving).

Each of the last six was better off than before with the first four

continuing to drink for free.

 

But, once outside the bar, the men began to compare their savings. "I only

got £1 out of the £20 saving," declared the sixth man. He pointed to the

tenth man, "but he got £10"

 

"Yes, that's right," exclaimed the fifth man. "I only saved £1 too. It's

unfair that he got ten times more benefit than me"

 

"That's true" shouted the seventh man. "Why should he get £10 back, when I

only got £2? The wealthy get all the breaks"

 

"Wait a minute," yelled the first four men in unison, "we didn't get

anything at all. This new tax system exploits the poor" The nine men

surrounded the tenth and beat him up.

 

The next week the tenth man didn't show up for drinks, so the nine sat down

and had their beers without him. But when it came time to pay the bill, they

discovered something important - they didn't have enough money between all

of them to pay for even half of the bill.

 

And that, boys and girls, journalists and government ministers, is how our

tax system works. The people who already pay the highest taxes will

naturally get the most benefit from a tax reduction. Tax them too much,

attack them for being wealthy and they just might not show up anymore. In

fact, they might start drinking overseas, where the atmosphere is somewhat

friendlier. of economic thought this explains everything.

[Whitey Grandad]

Again, the logic of the simpleton.

 

You can cut borrowing if you borrow to buy something that ends up being worth more than you borrowed when you sell it. If you can't understand that then you are an imbecile.

 

Now who's being stupid? This is not true if the cost of borrowing - it's called interest by the way - makes the total cost of purchase higher than the increase in value of the item bought. Or even if the increased borrowing leads to inflation that reduces the value of that object. What do you suggest we invest in? If you are talking about machinery to improve manufacturing productivity, better transport infrastructure, more oil or gas wells? Because I don't hear Labour suggesting that we do any if this and nor did they when they were in power. Perhaps we should have bought gold and sold that when it shot up in value? Oops, we did exactly the opposite.

 

You should realise that many of the posters on here have a long experience of running successful businesses and enterprises and might just know something about what hey are writing.

[Sergei Gotsmanov]

Now who's being stupid? This is not true if the cost of borrowing - it's called interest by the way - makes the total cost of purchase higher than the increase in value of the item bought. Or even if the increased borrowing leads to inflation that reduces the value of that object. What do you suggest we invest in? If you are talking about machinery to improve manufacturing productivity, better transport infrastructure, more oil or gas wells? Because I don't hear Labour suggesting that we do any if this and nor did they when they were in power. Perhaps we should have bought gold and sold that when it shot up in value? Oops, we did exactly the opposite.

 

You should realise that many of the posters on here have a long experience of running successful businesses and enterprises and might just know something about what hey are writing.

 

I think we should all be building tractors.

[anothersaintinsouthsea]

Oracle Saint that some of the biggest horse **** I've read for ages. Which sh1te tea party site did you rip that off?

[Jonnyboy]

We have invested borrowed money to save the banks. That's why the big question is when we sell our shares in rbs and Lloyds, will it be at a profit or a loss? I hear the tories are tempted to sell early and at a loss but at least the xtra income will help them look as though f they have cut our debts.

[Lord Duckhunter]

I wish people would get their heads round the simple fact that there have been no ****ing cuts. It is just a slow down in the rate we increase public spending. Once all of this governments "cuts" are in place they will have cut spending by a massive 1% at the next election. If that's austerity then my cocks a carrot. "Too far too fast" what did labour want 0.5 % over 10 years.

 

Spending to try and kick start recovery is one side of the coin, the other side is to pay down debt, reduce welfare and not run a deficit during an upturn. Labour blatantly failed to do this, seemingly beleiving they had abolished "the bust". When the inevitable bust came, they left us I'll equipped to respond and with no leeway to expand the deficit and do what they are calling for us to do now, borrow more.

 

All the parties want to do is manage the public, deep down they know that massive cuts are needed , that real austerity required (Ireland has cut spending by 15%), but are concerned about popularity rather than doing what's right.

 

The stupid thing about it is that the public were ready for cuts, that the public believe we've seen cuts, yet the government didn't have the balls to give us cuts. They've taken all the political hits and all the bad press, but haven't got an economy in shape and ready to recover. They're like a bloke whose wife leaves him after catching him with another bird, a bird he never actually banged, just had a quick grope with.

[anothersaintinsouthsea]

Surely spending has been cut in 'real terms'

[Sergei Gotsmanov]

Again, the logic of the simpleton.

 

You can cut borrowing if you borrow to buy something that ends up being worth more than you borrowed when you sell it. If you can't understand that then you are an imbecile.

 

Eloquently argued. Talk me through Hollande's strategy in France?

[dubai_phil]

There was an old couple interviewed on Sky News on holiday in Cyprus. They asked them about the Foreign Office advice about being careful and having cash.

 

They were fine with it.

 

Then they said "Can't understand all the moaning. IF you spend more than you have, you have to pay it back"

 

Now why on earth is that so hard to grasp for so many people.

 

The banks got everyone in this mess, yet they still pay out obscene bonuses even while making massive write downs on fraudulent selling and bad investments (The let's invest for the future argument makes sense IF someone with a brain and an eye for THE FUTURE rather than THE NEXT LOAD OF VOTES or NEXT MONTH's BONUS CHEQUE is making the decisions).

 

The law should have been changed to make the decision makers in the banks liable for the losses on their investments.

Maybe then they would have invested in Industry, SMB's etc which take a longer time to turn a profit than a trip to Paddy Power on the value of some obscure mineral next week.

Banks have been the same for nearly 30 years - have a good business idea that could flourish and create wealth? No chance of borrowing money for that whether it was today or 1980.

Take a punt on the Euro? piece of cake, any cokehead can do that with someone else's money.

 

And then pay an Accountant to avoid taxes

[Whitey Grandad]

Surely spending has been cut in 'real terms'

 

Yes, it's been cut in any terms, but nowhere near enough. We're still spending far more than we generate. The cuts were cuts in projected increases.

[CHAPEL END CHARLIE]

...

Edited 11 April, 2013 by CHAPEL END CHARLIE