BORROW YOUR WAY OUT OF DEBT

yo...the bollox are back in town...innit!


PALOOKAVILLE FINANCIAL
stardate : capitulation day
+106...


...desperate times call for desperate columns...


...it would appear that anatole has himself been crunched...


...what would mish say?...


...all roads lead to palookaville...it would seem...

Punish savers and make them spend money

Near-zero interest rates and even a tax on bank deposits are necessary to force those with cash to use it productively

Anatole Kaletsky


..." I believe, in line with the vast majority of non-socialist economists, that Mr Cameron's campaign for savings is completely wrong; that “borrowing our way out of debt”, paradoxical as it sounds, is exactly the right prescription for our present problems. This paradox is easily explained: if governments or wealthy individuals increase their borrowings they replace weak debtors - bankrupt hedge funds, struggling businesses or repossessed homeowners - with strong ones and this helps to stabilise the financial system and sustain economic activity and employment. The country can borrow its way out of debt. But what I think is of little importance, especially as I have been wrong about so many aspects of this crisis - as have most conventional economists and policymakers, whose views I broadly share....

...Assuming interest rates are reduced to about 1 per cent today, it will make little difference to savers if they fall all the way to zero. To all intents and purposes, income from bank accounts will be reduced to nil.

The next logical step, although it may be politically controversial, would be to do the opposite of what the Tories suggest. Instead of reducing taxes on interest payments, the Government could tax all bank deposits and other risk-free savings. This would create a negative risk-free interest rate, encouraging savers either to invest in property, shares and other productive assets - or simply to save less and consume more. In either case, the result would be more consumption and physical investment, less unemployment and faster recovery from the slump.

In the absence of a savings tax - and even Mr Obama would probably balk at anything so controversial - there are plenty of other measures to boost consumption and investment. Most obvious are direct government spending on infrastructure; public guarantees and subsidies for business loans or home mortgages; or tax cuts and handouts, especially for those on low incomes who tend to spend all their money. The beauty of such policies in a world of zero or near-zero interest rates is that they are effectively cost free. In the present environment, extra public borrowing does not displace private employment or “crowd out” business investment.

There are plenty of objections to ever-increasing public borrowing, not just fairness and efficiency but also the moral hazard of creating a culture of state-dependence. But in a slump, when the alternative is business bankruptcies and longer dole queues, these objections make little sense.

PLEASE DO NOT ADJUST YOUR SETS


SENSE OF HUMOUR REQUIRED


beuhla : too daft ta laugh at innit!

ONCE-UPON-A-TIME INNA 'VEST

yo!...let there be light..!...innit!

PALOOKAVILLE FINANCIAL stardate capitilation day+24

...western banks are under attack from the forces of deflation...they shares is sinkin fast as...
...no f*cker wants em...

...smoke an mirrors was used to create an ilussion o BOOM an nah itz BUST...

...alla kings orses an alla kings men atta meetin...tryin ta put humpty dumpty...
...back together agin..

...trouble is...trust gone walkabaht...an itz alla cos o lies an stuff...

...banks bin lyin...govment bin lyin...

market ticker : ..."The short version of The Genesis Plan is:

1. Everyone must expose their balance sheet; all Level 2 and 3 assets must be declared and all models disclosed in full immediately and every quarter hereafter.
2. The CDS monster must be caged by forcing it onto an exchange where O/I and margin supervision can be maintained. This is already in process and must be completed.
3. Leverage must be returned to no more than 12:1 across the system - no exceptions.

liam : ..."Wholesale money markets won’t start operating freely again until all banks are forced – by law if necessary – to declare the entire extent of their exposure to sub-prime, default swaps and any other loss-making position.

Such “full disclosure” will hurt some banks very badly. Chief executives will be sacked, reputations crushed, and more institutions will fail. But, with the Government standing ready with finance to prevent systemic meltdown, such “creative destruction” must happen – with stronger banks taking over the weak. That’s how capitalism works. The system needs to be purged. And until it is, it’s a myth to think the inter-bank market will work...." sunday times

TELL THE TRUTH ABOUT NATIONAL DEBT

liam : Let’s call time on spiralling national debt

..."All these multibillion dollar bail-outs are pushing Western governments closer to bankruptcy. Iceland shows it can happen. OK, Iceland is small and its authorities have been particularly remiss, but it’s an advanced nation — not a tinpot banana republic. A rubicon has been crossed.

Credit default swaps on the sovereign debt of some Western nations have shot up. The markets don’t yet think the likes of Italy and Spain will go bust, but the chances are growing they could.

So dire is America’s fiscal health that even technology can’t cope. Last week, the digital clock in New York’s Time Square, which shows the US national debt, symbolically ran out of digits. It was first installed in 1989, when the country’s debt was $2.7 trillion – a 13-figure number. Now the total is $10.3 trillion, the display is simply too small.

As this column has previously argued, we need such a clock in Britain. Some moneybags short-seller should give something back, sponsoring one in London’s Piccadilly Circus. The Government certainly won’t fund it.

The Treasury claims our national debt is around £550bn. That number – how can I put this delicately? – is total nonsense.

Our politicians and civil servants have made an invidious art form of burying off-balance-sheet liabilities. I’m thinking, in particular, of the private finance initiative, quasi-private debts held by the likes of Network Rail and – above all – our enormous public sector pension bill.

The UK’s true national debt – even before last week’s multibillion pound package – exceeds £1,300bn (some £50,000 per household). Every penny will have to be re-paid from future taxation. That’s before we spend any more...." sunday times

neil young : nuthin is perfec in Gods perfec plan...jus lookin a shadows ta see...

petey : shine a light onnit...tell a truth... for once!