economic situation is dire

[snowychap]

So AUtumn statemnet. Any thoughts?

Robo's hacked your account?

[markavfc40]

Most startling thing that come out of it for me is that public sector job losses has been revised up from 400,000 to 710,000 by 2017. I mean where do you draw the line and when does it become impossible to deliver a decent level of service. Many public services are already at breaking point.

I dread to think what level unemployment will be at come the end of this parliament.

[tonyh29]

So AUtumn statemnet. Any thoughts?

Robo's hacked your account?

[tonyh29]

Was chatting to the afore mentioned Robo the other day and he thinks the govt want to U-turn but can't as it gives Balls and Ed the chance to score points ... such is all that is wrong with politics to some degree "IF" UK policy is all about face saving

but based on Osbornes moves , UK gilt yields dropped below their German equivalents last week and are in some small measure evidence that the UK austerity programme is working: where once there were threats of a credit-rating downgrade, Britain is now a safe haven ... so Osborne deserves some credit there ..not that i expect anyone on VT to give it to him of course ....

So where I slightly disagree with Robo is that Osborne should hold his course ...

I saw some data today that suggests the public are not pinning the blame for the downturn on the govt at this moment in time go back to black Monday and the public confidence in the govt crumbled ..and never recovered ... so some degree of hope there for the govt as well ...

[snowychap]

but based on Osbornes moves , UK gilt yields dropped below their German equivalents last week and are in some small measure evidence that the UK austerity programme is working: where once there were threats of a credit-rating downgrade, Britain is now a safe haven ... so Osborne deserves some credit there ..not that i expect anyone on VT to give it to him of course ....

We keep on hearing this about gilt yields from government ministers (Osborne, Beaker et al) and backbenchers and (mostly) commentators who are using it as evidence in support of austerity measures.

We also hear from people on the other side (often shouted down quite vehemently - see Michael Fallon this afternoon) that low gilt yields point towards a very gloomy outlook for the economy.

Dillow's blog today on the subject:

What are gilts saying?

In his Autumn Statement George Osborne said that the UK government is now “borrowing more cheaply than Germany" and (par 1.39) “there is evidence that the Government’s fiscal plans are contributing to improved market confidence, with UK long-term interest rates reaching a record low*.

This, though, runs into a problem. Low gilts yields - either in absolute terms or relative to overseas - are, in themselves, an ambiguous sign. Yes, they might signal confidence in the government’s creditworthiness. But they might also signal that the economy is weak. How can we adjudicate between these interpretations?

One way is to look at share prices. If gilt yields fall because of better creditworthiness, share prices should rise as investors attach a lower probability to the risk of a debt crisis which causes capital flight and enforced austerity. But if gilt yields drop because of a weak economy, shares should suffer.

My chart tries to adjudicate between these two possibilities. It shows the FTSE small cap index (chosen because small caps are more exposed to the UK economy than the FTSE 100 which is dominated by multinationals) relative to MSCI’s world index in sterling, which controls for global influences upon equity prices.

This chart is wonderfully ambiguous.

Tories can point to the rise in small caps relative to the world between May 2010 and this summer as a sign that the fall in gilt yields (from 3.8 to 2.5 per cent for 10 year ones) was accompanied by increased confidence in the UK economy - or, at least, reduced fear of a debt crisis.

However, Labourites can point to the drop in small caps since then as a sign that lower gilt yields are a sign of depressed economic confidence.

I’d stress that, in both cases, the moves are small; if I’d started my chart earlier, the last 18 months would look like a horizontal line.

The only message I’d take from this is that political disputes are rarely settled by the facts.

* I’m not sure this is strictly true. Yields on 2.5% Consols, for which we have the longest history, are now 3.68%, which is higher than they were between 1934 and 1950 or in the 40 years before World War I.

[Dale]

The government has started turning the steering wheel... Shame it takes more crisis for Osborne to see what most had been shouting for some time.

[drat01]

The government has started turning the steering wheel... Shame it takes more crisis for Osborne to see what most had been shouting for some time.

Dale as a Lib Dem you must seriously cringe and be very unhappy with the words that people like that idiot Danny Alexander come out with to try and support Gideon?

On C4 just he blamed all of the current mess on the world, the banks, the Labour party, the unions, anyone and everyone except the Tory and the Lib Dems. The reality is that this Tory led Gvmt have failed massively, Plan A (which supported their own party donators as opposed to the country) is failing and we are about to hit even more massive job losses and financial problems, but they still have only the "ahh but Labour" as an excuse, while continuing to help out people who conveniently support the Tory party.

This Gvmt have failed in such a massive way it beggars belief that anyone can take with any sort of seriousness any more because its obvious what they lack in ability they make up for looking after their own.

But I suppose they can trot out again "ahhh but Labour", quite pathetic really.

[tonyh29]

don't make me get my hangman pic out again Ian .... :winkold:

[CarewsEyebrowDesigner]

the guvmint may have failed in getting us back on track, but they didn't let the bankers off the leash in the first place, it wasn't gideon that turned a blind eye to credit card companies **** it's customers in the arse and allowed them to put us in an infinite loop of payment, and it's those **** that are benefiting from getting us out of the mess they got us in.

there is a deeper issue than punch and judy politics, and i for one would like it to be dealt with rather than this petty bickering in the house of commons.

[drat01]

don't make me get my hangman pic out again Ian .... :winkold:

Which did not make sense then nor would it now

Again though nothing but blaming others from the Gvmt and the reality is that they are the ones who are supposedly in charge, but all we see is complete and utter ineptitude and teflon politics where they try and blame anyone and everyone but themselves.

[drat01]

the guvmint may have failed in getting us back on track, but they didn't let the bankers off the leash in the first place, it wasn't gideon that turned a blind eye to credit card companies **** it's customers in the arse and allowed them to put us in an infinite loop of payment, and it's those **** that are benefiting from getting us out of the mess they got us in.

there is a deeper issue than punch and judy politics, and i for one would like it to be dealt with rather than this petty bickering in the house of commons.

CED - the Gvmt "promised" (like they did on many things only to go back on them within days of taking power) to sort out the banks. Interesting that the cuts in child tax credits is massively more than bank taxes, so its pretty obvious who this Gvmt are attacking with these cuts

The whole economic structure of the world's banking system was one that caused many problems. The UK as a major player accommodated the banks and yes they were given far too much power and we are suffering now. But that is not the only cause of the issues this country faces. Attacks, ideologically led, are nothing more than Tory core values and things such as privatisation of the NHS are there for all to see.

You are completely right about the Punch and Judy thing, and Cameron (who is proving day after day what a liar he is) said he wanted to avoid that. What a shame that he, and most of this Gvmt are more concerned with supporting their backers than actually dealing with the day to day issues. There was a comment recently about the need for party politics now and the reality of that is that its not needed. what is needed is the right people for the job based on ability, not on who they went to school with or who has given them money.

True coalition Gvmt not the sham we have now

[tonyh29]

When they weren't inviting her to Downing Street , didn't Labour keep on blaming Thatcher right up until at least 2009 ?

with Villatalk of course not being as forgiving as the labour party :winkold:

[VILLAFC2000]

Any one think we will go back into recession...?

[VILLAFC2000]

When they weren't inviting her to Downing Street , didn't Labour keep on blaming Thatcher right up until at least 2009 ?

Yes and still to this day - Thatcher Thatcher the Milk snatcher.

[thetrees]

On C4 just he blamed all of the current mess on the world, the banks, the Labour party, the unions, anyone and everyone except the Tory and the Lib Dems. The reality is that this Tory led Gvmt have failed massively, Plan A (which supported their own party donators as opposed to the country) is failing and we are about to hit even more massive job losses and financial problems, but they still have only the "ahh but Labour" as an excuse, while continuing to help out people who conveniently support the Tory party.

This Gvmt have failed in such a massive way it beggars belief that anyone can take with any sort of seriousness any more because its obvious what they lack in ability they make up for looking after their own. .

As you well know Ian, the Tory 'own', as you describe them, increase their wealth at a far greater rate under Labour governments than they do under Tory governments. The reason that they support the Tories is to bring the country back from the brink every now and then to lay the ground for the next Labour government to embark upon more irresponsible mismanagement of the economy, thus ensuring that their wealth will increase further.

Labour has always been the party that most suits the rich, with Messrs Blair and Brown giving the rich the greatest years that they ever had.

[Risso]

When they weren't inviting her to Downing Street , didn't Labour keep on blaming Thatcher right up until at least 2009 ?

Yes and still to this day - Thatcher Thatcher the Milk snatcher.

Were you even born then? Are you even old to remember any Conservative PM before Cameron, I'm guessing not.

[snowychap]

Any one think we will go back into recession...?

If the ONS can get away with it, no.

[drat01]

When they weren't inviting her to Downing Street , didn't Labour keep on blaming Thatcher right up until at least 2009 ?

with Villatalk of course not being as forgiving as the labour party :winkold:

ahhh but Labour ....... so predictable

[tonyh29]

When they weren't inviting her to Downing Street , didn't Labour keep on blaming Thatcher right up until at least 2009 ?

Yes and still to this day - Thatcher Thatcher the Milk snatcher.

Don't suppose it would surprise you to know that you are wrong and that it was actually Ted Heath, but don't let facts get in the way of your posts

[drat01]

On C4 just he blamed all of the current mess on the world, the banks, the Labour party, the unions, anyone and everyone except the Tory and the Lib Dems. The reality is that this Tory led Gvmt have failed massively, Plan A (which supported their own party donators as opposed to the country) is failing and we are about to hit even more massive job losses and financial problems, but they still have only the "ahh but Labour" as an excuse, while continuing to help out people who conveniently support the Tory party.

This Gvmt have failed in such a massive way it beggars belief that anyone can take with any sort of seriousness any more because its obvious what they lack in ability they make up for looking after their own. .

As you well know Ian, the Tory 'own', as you describe them, increase their wealth at a far greater rate under Labour governments than they do under Tory governments. The reason that they support the Tories is to bring the country back from the brink every now and then to lay the ground for the next Labour government to embark upon more irresponsible mismanagement of the economy, thus ensuring that their wealth will increase further.

Labour has always been the party that most suits the rich, with Messrs Blair and Brown giving the rich the greatest years that they ever had.

The dilemma that Gideon, Cameron, Clegg and the idiot that is Danny Alexander face is how they put a consistent blame on anyone but themselves. As was shown today when they blamed the world, unions, Labour and next door's cat for their failed policies they never admit to any of the failings despite what the world actually shows in that the Tory ideologically led policies are not working, nor would they ever.

People in general across the world got richer at the time of the last Gvmt, not as a result of Labour but the world seemingly had a growth spurt that was based on sand so its now obvious. This Gvmt were consistent when in opposition in wanting to go further with plans for things like spending, borrowing, Iraq and many many other things, all items now conveniently forgotten while they coat themselves in Teflon.

You may not like her as a person but this piece in the Grud is a perfect summing up of Gideon and Cameron and the lap dogs that are Clegg and Alexander

link

George Osborne's every blow falls on those with less not more

With his autumn statement, the chancellor has declared class war: a Tory assault on the public sector and the poor

Class war, generation war, war against women, war between the regions: George Osborne's autumn statement blatantly declares itself for the few against the many. Gloves are off and gauntlets down, and the nasty party bares its teeth. Here is the re-toxified Tory party, the final curtain on David Cameron's electoral charade. No more crocodile tears for the poor, no more cant about social mobility or "the most family-friendly government" or "we're all in this together". Forget "vote blue go green", with this mockery of husky-hugging. Let the planet fry.

Exposed was the extent of pain for no gain, exactly as Keynesian economists predicted, a textbook case. Things are "proving harder than anyone envisaged", says Cameron. But precisely this was envisaged by Nobel-winning economists. Extreme austerity is causing £100bn extra borrowing, not less, while everything else shrinks – most incomes (the poorest most of all), employment, order books and exports. Pre-Christmas shopping – already discounted – heralds more imminent company collapses, and the only high street growth is in pawnbrokers, charity shops and Poundlands filling up the black gaps. For all the flurry of small announcements to kickstart business, infrastructure doesn't create jobs fast enough to replace the 710,000 more public jobs to go. The iron envelope of public spending is unchanged. Osborne learns nothing from experience.

What was missing from his list? Not one penny more was taken from the top 10% of earners. Every hit fell upon those with less not more. Fat plums ripe for the plucking stayed on the tree as the poorest bore 16% of the brunt of new cuts and the richest only 3%, according to the Resolution Foundation. Over £7bn could be harvested with 40% tax relief on higher pensions, while most earners only get 20% tax relief; £2bn should be nipped from taxing bankers' bonuses, but the bank levy announced was nothing extra. There was no mansion tax on high-value properties, though owners don't even pay their fair share of council tax, and property is greatly undertaxed compared with other countries.

Worse still, two-thirds of properties worth over £1m now change hands while avoiding all their 5% stamp duty, by using offshore company accounts. But not a word passed Osborne's lips on tax avoidance and evasion. Another 12,000 tax collectors are losing their jobs while some £25bn is evaded and £70bn avoided. In a time of national emergency, Osborne had no breath of rebuke about the responsibility of the rich not to dodge taxes, no threat to curb the culture of avoidance. Despite the High Pay Commission report on out-of-control boardroom pay – which even the Institute of Directors has called "unsustainable" – the chancellor said nothing. How adamantly he ruled out the Tobin tax on financial transactions, called for by those dangerous lefties Nicolas Sarkozy and Angela Merkel.

Instead came the great attack on public sector employees on the eve of the biggest strike in memory. This was a declaration of open class war – and war on the pay of women, 73% of the public workforce. After a three-year freeze, public pay rises are pegged at 1% for two years, whatever the inflation rate. That means this government will take at least 16% from their incomes overall. But the plan to abolish Tupe – the rule that ensures public workers are not paid less if their service is privatised – is outrageously unjust, and will lead to mighty resistance to all privatisation from senior as well as junior staff.

As bad is the plan for reduced public pay rates in poorer regions. What draws good teachers and doctors to work in hard places is the same pay with a lower cost of living. Cut public pay in the north-east or the most impoverished places and their economies will plummet, making them poorer still. This will drive a yet deeper divide between north and south.

But the direct assault on the poor is almost beyond belief. Watch how the big, powerful charities on Tuesday expressed uncharacteristic outrage. Along with the Children's Society, Save the Children is fiercer than I can ever recall, calling this "dire news for the poorest families – both in and out of work"; "A major blow", says 4Children; while Barnardo's calls it "a desperate state of affairs when the government's own analysis shows that a further 100,000 children will be pushed into poverty as a result of tax and benefits changes announced today".

That 100,000 is added to the 300,000 that the Institute for Fiscal Studies already expected to join the numbers of poor children from Osborne's previous cuts. The increase in the number of two-year-olds getting nursery schooling is excellent, but why pay for it by taking from the tax credits of those families supposed to benefit? Households that gain are commuters, higher up the scale: few in the bottom 25% have cars or use trains. Meanwhile, the young are hit, the cut in the education maintenance allowance causing fewer to attend college at 16, and there are signs of a serious fall in university applications.

Politically, how will this feel? The outrage of respected charities is telling: worms are turning. The government has deliberately and unjustly provoked the whole public sector – from headteachers to hospital cleaners. Cameron and Osborne's record for serious miscalculation is formidable – from the economic effect of their austerity to their unravelling NHS debacle and the precarious work programme.

The gap between what they say and do is now exposed. The injustice of how the pain has been shared is breath-taking. A windfall taking just one year's bank bonuses would pay for all the cuts in youth services and the EMA for the next 23 years. That's just one example. Osborne is fatally wrong on the economy, as his deficit target slips by two years in just the past eight months. But even if his straitjacket were necessary, the pain would be politically acceptable only if justly shared. The Bullingdon budget tears the last veil of deceit, leaving the nasty party naked for all to see. But every school will get its King James Bible with Michael Gove's presumptuous foreword: is prayer all that's left?

Maybe the Give plan to distribute Bible's is what we need? :-)