Gross National Happiness

[Harleyman]

You are preaching to the converted.

 

My daily mantra is Life. Love. Laughter.

 

Catch you later man...I'm off for an hour of Sycamore hugging. :hihi:

 

 

 

You might see prince Will there. He must be a grossly happy chappy today although his preference must run to Royal Oaks when it comes to tree hugging.

 

Heard that he takes after his daddy and talks to plants as well

[mossdog]

Unfortunately that started to happen some time ago - but it appears that the actions of the present government arrested it before it got too bad.

 

The pound was under severe pressure earlier this year. Fortunately, that pressure eased before its weakness managed to cause too much damage.

 

The Outlook for the UK’s AAA Rating and Its Impact on Gilts (24 Mar 2010)

S&P’s negative outlook contributed to the rise in gilts yields towards the end of May 2009 as well as to a rise in the cost of insuring against a default by the UK government; the cost of this insurance was reflected in the increasing value of the five-year credit default swap (CDS) contract.

 

The country is already paying outrageously high amounts in interest on its debt. It can ill-afford to have the interest rates rise.

 

Benchmark gilt down (May 2010)

 

FITCH WARNS ON BRITISH DEBT (Jun 2010)

 

But:

Austerity plan helps UK retain top AAA rating - Telegraph

"Britain's recovery prospects have been helped by the Coalition's austerity drive, a top credit ratings agency has declared.

 

The judgment, by Moody's, is a ringing endorsement for the extra £40bn of spending cuts and tax rises George Osborne unveiled at the Budget. It will also feed into the debate about whether the Coalition's measures are in the best interests of the country".

 

 

 

It appears some of those lenders - or rather the Credit Ratings Agencies, who advise those lenders - seem to think that a gentler reduction over a longer period would do anything but. They seem to disagree with you. They - like you - are entitled to their opinions, but given that their client's (the potential creditors) willingness to lend (or at least the rate at which they are willing to lend) depends on their assessment of the risk, their view is perhaps the view which is important.

 

British Inflation is running at about 5%. If a creditor loans money to the British Government and is willing to accept repayment in Pounds Sterling, then that investor is going to need a yield of 5% not to lose money. If he wants to make money (if he wants to be paid for the risk in lending) then the yield will need to be higher.

 

The Irish deficit is increasing, despite fairly harsh spending cuts. The cost of Ireland's debt is increasing.

 

The coalition government's plans are going to hurt - but people in the UK are a long way from being poor - compared to much of the rest of the world.

 

The Pound Sterling has recovered considerably since its lows earlier this year, but if it should fall in value against other currencies, then although exports will be more attractive, the cost of raw materials, the cost of oil, the cost of gas, and the cost of food (remember, you import 40% of that) will all increase. A reduction in the value of Sterling makes debt denominated in Sterling rather unattractive, so the cost of that debt would have to rise to keep the creditors willing to lend.

Steady on Mr Baehr!................people have been burnt at the stake in old England for talking a few home truths! and some round here still don't like it!

[Lotusflower]

[/b]

 

 

 

You might see prince Will there. He must be a grossly happy chappy today although his preference must run to Royal Oaks when it comes to tree hugging.

 

Heard that he takes after his daddy and talks to plants as well

 

Don't we all?

[Mecky]

But hung parliaments are part of our electoral system.

 

Let's face it, if Labour had formed a minority government and had just announced unpopular cuts you wouldn't be calling for a new election so someone can win with a majority.

 

Let's have one and see if I wouldn't then.

[Tony]

Let's have one and see if I wouldn't then.

 

Why would you on your taxpayer funded civil service salary that pays you while you play on SF.

 

Viva la revolution!

[altus]

Let's have one and see if I wouldn't then.

We will do in about five years time.

[Boblet]

Unfortunately that started to happen some time ago - but it appears that the actions of the present government arrested it before it got too bad.

 

The pound was under severe pressure earlier this year. Fortunately, that pressure eased before its weakness managed to cause too much damage.

 

The country is already paying outrageously high amounts in interest on its debt. It can ill-afford to have the interest rates rise.

 

It appears some of those lenders - or rather the Credit Ratings Agencies, who advise those lenders - seem to think that a gentler reduction over a longer period would do anything but. They seem to disagree with you. They - like you - are entitled to their opinions, but given that their client's (the potential creditors) willingness to lend (or at least the rate at which they are willing to lend) depends on their assessment of the risk, their view is perhaps the view which is important.

 

The coalition government's plans are going to hurt - but people in the UK are a long way from being poor - compared to much of the rest of the world.

 

The Pound Sterling has recovered considerably since its lows earlier this year, but if it should fall in value against other currencies, then although exports will be more attractive, the cost of raw materials, the cost of oil, the cost of gas, and the cost of food (remember, you import 40% of that) will all increase. A reduction in the value of Sterling makes debt denominated in Sterling rather unattractive, so the cost of that debt would have to rise to keep the creditors willing to lend.

 

Selective editing to your post to try to keep it brief

 

Again I don't necessarily disagree with all of what you say, just, principally, your conclusion that any alternative would not have been acceptable to the lenders and/or credit ratings agencies

 

No-one knows what the reaction would have been if a slightly softer Budget had been presented - you can speculate, so can I and others, but we will never know

 

But TINA was wrong in the Eighties and is wrong now - there are always alternatives - they have different consequences, and different costs and benefits, and how you perceive the relative importance of these determines how you proceed

 

Spend, spend, spend isn't the answer, but slash and burn isn't the only other option (not that the reality of the outcome of the Government's spending review will match it's rhetoric, but that's a different issue)