Post Budget Blues or Pre Election Reds - Playing Risk with Your Future!
So Alisdair Darling delivered his pre-election budget to a crowd of disinterested Brits yesterday and effectively opened the floodgates for the six week marathon of Polls, Accusations, Taunts, Cajolery, Calumny and Political Bollocks that culminates with you putting your X in the box of damage limitation and patting yourself on the back for being Democratic. (Especially if you are from an extremist party such as the BNP)
So what are the
choices?
Hmm - A pompous inexperienced public school prat of the Harry Enfield mold with zero social conscience or a one eyed Scot with questionable religious motives whose already been given the chance to 'change' things and failed miserably in some quarters!
Yep, I can hear you all shouting that there are other choices, but my yellow friends you are kidding yourselves. I want you to all return to your constituencies and prepare not to govern!
This is a straight Two horse race like it or not - although it may, like the pathetic Lib/Lab pact of the Seventies not decide the outcome at the first hurdle.
In fact with all these Tory created Strikes and Industrial actions leading up to the election I keep getting flashbacks that I'm in 1979.... God help us all....
So today unpolitical but always controversial Insurance Blogger, nails his colours firmly to the mast and asks you the British people.....
NOT TO VOTE FOR CHANGE !!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
Why?
Because in case you haven't noticed the UK Economy is on the brink of slipping back into recession.
The Interest Rates need to be kept as close to zero for at least another five years if the Japanese Economy recovery experience of the Nineties is to be followed.
A Conservative Government would naturally interfere with Interest Rates and the Bank of England monetary policies.
The Conservative party simply cannot be trusted not to inflate the rates to protect their own and their core voters savings!
Look what happened to the UK the last time they were allowed to Govern!
Lest we forget that quickly?
SELLING ENGLAND BY THE POUND
The Bank of England who along with the major European Insurance Companies, are currently doing a mighty fine job of managing UK Debt.
Insurance Companies can't buy enough UK Government debt in the shape of gilts!
The last offering of UK debt this month was 3 times oversubscribed as the
Insurance Illuminati rushed to defend Britain!
It looks like the UK Government are managing the debt pretty soundly!
Truth is, where else do you put your money? Greece? The Euro??
So if Insurance Companies (who BTW own everything including the banks) have faith in the Status Quo - - then So do I!
A vote for Cuckoo Cameron would be utter Madness. Cuckoo BTW because he hasn't got any policies of his own!
Answers, objections and biased opinions in the comment box below please!
XLabels: Bank of England, Cuckoo Cameron, David Cameron, General Election, Gordon Brown, Quantitative Easing, UK government
Euro On The Point Of Collapse - Victim Of A Trojan Horse?
If the Franco-German alliance fails to bail out the Greek debt then the Euro will most certainly collapse!
Mass Devaluation.
Cheap Holidays in the Sun!
Suddenly Europe will not be worth half as much as it was!
Worse still for the Euro Bankers is the fact that the amount of Greek debt appears unquantifiable due to some smart bookeeping by the previous conservative government who were incumbent for most of the credit crunch and the subsequent recession.
This is not going to impress those financial entrepreneurial illuminati who have their money tied up in the Euro and itchy fingers on the sale button!
Europe is supposed to be growing itself out of recession faster than the UK or USA.
Some say that this is a mirage and was a temporary bounce due to the Eurobankers encouraging consumer spending coupled with the christmas seasonal factor.
The overall trends appear to be down!
If the Euro collapses on the money markets, all participants will pay the price of the Greek tradegy.
I can already hear the British Euroskeptics say 'I Told You So!' as the Irish economy collapses.
So what will it mean for the UK and in particular the
UK Insurance Industry?
Well Insurance Blogger thinks it could be a very good thing for the UK financial services industries as a whole.
After all when the Money markets sense a tsunami coming; the smart money always runs to the safest shores!
Of course the right wing euro-sceptics will claim victory in the advent of a Cameron led election victory; but the real praise must go to
Gordon Brown and Barack Obama for not following the Euro pump priming recovery route.
Labels: Bank of England, Barack Obama, Currency Exchange, Euro Bankers, Gordon Brown, Greece, Greek Economy, Money, MoneyMarkets, pump priming, UK government, UK Insurance
Insurance Companies buy more UK Government Debt
The Bank of England has just announced that the latest efforts at so called Quantitative Easing involves the injection of another £25 billion of made up money in the circular flow of money system, which means that since the recession Britain has generated £200 billion of made up debt!
So Where's the money gone? And what is Quantitive Easing anyway
It turns out that QE as the press now like to call it, is radically different from the Pump Priming developed by FDR in 1930 to get the States out of the Great Depression!
And this explains why you and me, the small and medium sized enterprise and it's workers are not getting any credit or money!
Truth of the matter is QE is designed to shore up the internal arteries of the international banking system and not leak any money out. To leak money by the creation of credit to the general public and increasing the money supply would introduce both inflationary and currency exchange pressures that would be far from welcome in the current economic climate.
So here is how QE works - The UK Government decides to make up some more cash to shore up the banking system. It creates £25 billion pound worth of bonds that it says you and me will repay! It then instructs the Bank of England which sells them to Banks. They make a nice profit by selling them onto - have you guessed it yet?
Yes 95% of the guilts and bonds go to INSURANCE COMPANIES! Very little money is being released to the public system.
It just means that today the Government decided that You, Me and Everybody! - in the UK, now owes another £25 billion of made up money plus the made up Interest, to Aviva et al.
So QE cannot have any beneficial effects to the likes of you and me, Joe Public, except the potential ability to stave off a second wave of recession by keeping the banks ticking over!
Pump Priming conversely is a 'lets spend our way out the crap' solution which would only work in the UK if the money is diverted into the public sector.
Why just the public sector?
Because only large national institutions have enough employees to spread the money to all parts of the system before it returns to the investment banks.
Like all system solutions they have to be top down and bottom up!
The recession will not come to an end in this country until we start pumping it into the bottom!
Labels: Bank of England, credit crunch, Insurance companies, money supply, Money System, pump priming, Quantitative Easing, UK government
Uk government moves to protect bank deposits
The Financial Services Authority (FSA) has increased the compensation limit for bank deposits from £35,000 up to a total of £50,000 for each customer's claim.
This increase applies from midnight Monday 6th October 2008.
Customers with joint accounts will be eligible to claim up to £100,000.
Whether this will be enough to stop funds flowing overseas remains to be seen.
Both Ireland and Greece have unilaterally declared to protect all depositers funds.
This move has caused great uncertainty within EU markets and at the weekend German Chanceller Angela Merck suggestede that German banks may take the same action.
We await further moves from Gordon Brown and Mr A Darling.
The situation could be worsened further this week as the Bank of England are erxpected to cut Interest Rates by up to 1% to deal with the ongoing banking and insurance credit crunch crisis.
Labels: Bank of England, Banks, credit crunch
UK Banks to further reduce public lending
Mortgages are being squeezed as Banks reduce lending further.
The latest Credit Conditions Report from the Bank of England has indicated banks and building societies are likely to further reduce lending activity over the next quarter.
Noting lenders had reduced the availability of secured credit to households in the three months to mid-September by more than they had anticipated in the Q2 survey, due in part to declining house prices and the economic outlook, it added a further decline was now expected.
A spokesperson for
UK Loans said "Confidence in the market is the catalyst for increasing the circular flow of capital. The downward trend in mortgage and public lending reflects the lack of liquidity flow between the lenders. We dont expect any deceleration in the downward trends until after the US general election, when confidence may enjoy a dead cat bounch.
Whether this honeymoon period in the US will be enough to halt the downward spiral in the UK remains doubtful, given that the UK growth figures were based soley on overvalued housing stock and a general election victory for whoever in the UK will not enjoy the honeymoon period that the end of the Bush administration will inevitably bring."
With artificial inflation the bubble will always burst.
Labels: Bank of England, credit crunch
