economic situation is dire

[Gringo]

No need to worry about of any of that nonsense as they've all agreed that basle III will save the world

Global bankers agree new capital reserve rules

So they've agreed to raise tier 1 capital levels to a level that most of the major banks have already achieved. But (following on from Levi's post above) there is no provision to bring counterparty, market/issuer and loan underwriting risk together to provide a real view of how this captial is measured. There's no improvement to the ethics controls which allowed goldmans to flog securities they were shorting. There's no new controls over credit default trading, which is basically an isurance policy but not governed in the same way as other insurance.

Building up for the next big fall. The banks won't create the next fall, they didn't create the last one (mortgage fraud did). But they'll be the ones being bailed out when it happens.

[CarewsEyebrowDesigner]

I'm bored of it all. Next time I run into a banker, I'm going to piss on his face.

[JulieB]

I just watched this. Extremely thought provoking.....

How the heck can any government think that they can solve a global financial crisis caused by excessive personal debt by expanding national debt to epic proportions is beyond me?!

When it all goes belly up these reckless governments will have no where to run...as the video states they can't lower interest rates further as they're already near zero and they will have no more capacity to borrow in an attempt to prop the whole system up again.

It is rumoured that the BRIC nations are planning to re-value oil from US Dollars to another currency in the next few years. This will overnight have a devastating effect on the Dollar and it will again surely send Dow Street into freefall.

The patient needs radical surgery not overdosing with medication in a vein attempt to stave off the inevitable!

[Genie]

Well, what a difference 12 months makes.

This time last year I'd been out of work since April, funds were getting tight which of course led to problems at the ranch.#

Now I got myself back into work as a contractor on a good rate and all is well at home including my now 5 week old baby. Better still I've just landed myself a permanent role at the place I've contracting meaning my position is as secure as it could be (my new employers have not made a compulsory redundancy for many many years). It comes with a decent pension scheme (I chuck in 4% of my salary and they put 8% on top) plus other perks like bonus etc.

The low interest rates mean I'm saving about £220 a month on my mortgage (Julie will be pleased to know I'm using some of it to over pay )

For me personally, I couldn't be happier. I managed to just about survive the recession and now going from strength to strength.

[veloman]

Sorry Jon, I meant for every £1 they're paid they create £10 worth of value to the Country. A banker destroys £7 in every £1 they generate.

A very interesting thread, if a bit complicated for me ! However, do you make this assertion based on "the Multiplier" concept ? (something I fully believe in btw but seems an old-fashioned, Keynesian view these days).

[soprano]

Congratulations on the nipper and the job Tamuff.

[Genie]

Cheers mate, we have a quote of the day thingy at work at it inspired my post.

Quote of the Day - Robert H. Schuller - "Tough times never last, but tough people do."

[tonyh29]

My FD was at a meeting with the head Honcho of Barclays a couple of days ago..

the opinion from him was nobody has a clue which way things are going to go with the economy . He thinks the UK economy is starting to pull through but is worried that Ireland , Spain , Greece and Portugal could pull the whole lot down as their economies are in dire straits.

Lot seems to hinge on Germany whose economy is now starting to thrive and how much they are prepared to bail out the rest of Europe through more quantitative easing

(may not have been the exact words used but was my summary / understanding of it )

[leviramsey]

Scandinavia a better place than US, UK to do business, says Forbes

The U.S. economy is teetering on the edge of a double-dip recession. High unemployment and a weak housing market are dragging down economic growth. But there's another major issue that isn't getting much attention these days: The business climate for entrepreneurs and investors in the U.S. is starting to lag behind other countries'.

The U.S. dropped from No. 2 to No. 9 in our fifth annual ranking of the Best Countries for Business. Blame the high tax burden and a poor showing on trade and monetary freedom compared with many other developed nations. The 35% federal corporate tax rate is the highest of any OECD country according to the Tax Foundation. Meanwhile the government’s significant intervention in the economy during the economic downturn has weakened economic freedom in the U.S. One bright spot for America: It still ranks first when it comes to innovation.

Grabbing the top spot for a third straight year is Denmark. Its $309 billion economy struggled in 2009, like the rest of the world, with GDP down 4.7%, but when it comes to advantageous business climates the Danes reign supreme. Denmark scored in the top five among all countries in four of the 11 categories we considered as part of the ranking, including property rights, technology, corruption and personal freedom.

Our ranking examines 128 economies. Other factors we looked at besides the above include red tape, investor protection and stock market performance. We leaned on research and published reports from the Central Intelligence Agency, Freedom House, Heritage Foundation, Property Rights Alliance, Transparency International, World Bank and World Economic Forum to compile the rankings.

A big mover up the rankings is Hong Kong, which swapped places with the U.S., moving up to No. 2 from No. 9. It scored in the top three for taxes, investor protection and both trade and monetary freedom. The Hong Kong economy has bounced back more quickly than others as it established closer ties to China through tourism, trade and financial links.

The Hong Kong stock exchange is the go-to destination for Chinese companies looking to sell their shares abroad. China’s third-largest bank by assets, Agricultural Bank of China, had an initial offering in July in both Hong Kong and Shanghai that was the world’s biggest IPO ever when it raised $22 billion.

One of the most business-friendly environments can be found in New Zealand, ranked No. 3 (up from No. 5 last year). New Zealand’s economy has undergone many free-market reforms and today relies heavily on international trade and tourism. It was alone in first in three of the factors we considered including corruption (lack thereof), investor protection and red tape for starting a business. GDP per capita of $27,400 still lags many OECD countries, but overall GDP declined only 1.6% in 2009, less than half the average of our top 10 countries, which was -3.5%. New Zealand also boasts the lowest ratio of public debt to GDP of any of our top 10 at 22%. Rounding out the top 10 are, in order, Canada, Singapore, Ireland, Sweden, Norway and the U.K. (10th).

And the worst countries for business? Zimbabwe moved out of the bottom of the rankings this year thanks to Venezuela. It scored badly across the board, highlighted by its bottom-two ranking for investor protection, monetary freedom and taxes. Hugo Chavez’s country continues to be mired in recession with inflation rates hitting 30%. The stock market has tanked too, down 32% over the past 12 months, third-worst of the countries we looked at. In recent years Chavez has nationalized companies in the cement, mining, media, oil and steel sectors, and that continued in 2010 as the government has seized more than a dozen banks this year.

The top 25 were:

1. Denmark

2. Hong Kong

3. New Zealand

4. Canada

5. Singapore

6. Ireland

7. Sweden

8. Norway

9. USA

10. UK

11. Finland

12. Australia

13. Netherlands

14. Belgium

15. Switzerland

16. Israel

17. Luxembourg

18. Iceland

19. Estonia

20. Germany

21. France

22. Cyprus

23. Chile

24. Portugal

25. Taiwan

[drat01]

That is QE that the Tory party was so against?

The full extent of the cuts and the speed and the severe impact of these - add to that VAT rises - are about to hit this country with a major force. I am talking with various business clients and the general mood in the city this and last week with clients there is one of panic. Everyone is onside with cuts, political and business, its the way they are being targeted that they are not happy with. Multi nationals are looking at outside of the UK to address holes in forecasts.

As the recent Mori poll said

Our Economic Optimism Index has sharply returned to negative territory, with more believing the economy will get worse than believe it will get better, and now stands at -21%, from +3 in July.

This Gvmt are targeting the wrong areas and with the wrong force

[leviramsey]

That is QE that the Tory party was so against?

QE is great as long as someone else does it.

[Gringo]

Peter Hitchens"]Will all we have turn to dust and ashes, just like my Soviet roubles?

Britain cannot go on as it is. Either our dominant elite will recognise that their ideas are wrong, and must be changed.

Or a series of avalanches will sweep away our comfortable lives.

I think I know which is more likely.

Catastrophes do happen, and people survive them after a fashion, though their lives are never really the same afterwards.

We have acquired a Government whose main reason for existence is to protect the status quo, which hates to think and which loves to pose

The post-1968 ruling class are so convinced of their own rightness that I can no longer believe that anything will persuade them they might be even a little bit wrong.

And once again I am reminded of the complacent fools’ paradise that was the Soviet Union in its last years. Somewhere I still have the bank book I acquired in communist Moscow, after a lengthy interro­gation about my class background.

In it are recorded the few hundred roubles I deposited there and will never see again. But Russians often had many thousands stored away.

All of it was dust and ashes when reality finally burst through the broken Iron Curtain.

Great mountain ranges of savings were abolished in an evening, as the currency was ‘revalued’ out of existence.

Supposedly generous health schemes collapsed – though in truth they had long been short of drugs, especially painkillers and antibiotics, and the filthiness of the hospitals had been a grave danger to recovery. Jobs that had been meant to last for life were abolished, and the places where those jobs were done vanished. Pensions went unpaid or became valueless.

The money, the jobs, the Welfare State were all based on an illusion. When the illusion became unsustainable, they crumbled.

Well, how can we afford to carry 1.5 million people who have never worked? How can we afford to house jobless migrant families in Notting Hill grandeur? How can we sustain the enormous NHS which we gorged with cash in good times, while quietly loading it with enormous long-term debts to finance a building splurge?

None of this is real. Our economy continues to function out of habit and faith rather than because we are paying our way in the world.

Our state education system is a gigantic international joke, so bad that the remaining employers here would mostly much rather hire Poles with hardly a word of English than the products of our anarchic classrooms, where multitudes have ‘special needs’ and failure is the only thing that is rewarded.

The people who said that manufacturing doesn’t matter now admit they were wrong, but that does not bring back the lost factories. The North Sea money that carried us over much of the worst is nearly all spent.

We have acquired a Government whose main reason for existence is to protect the status quo, which hates to think and which loves to pose – but to which there is no sensible opposition.

Only a contrite confession of failure, combined with a readiness to reconsider every policy from welfare to crime to schools to immi­gration, could possibly avert the great smash which seems increasingly likely to me.

We had our first warning in the failure of the banks. What will follow, if we pay no attention, will I think be worse.

[tonyh29]

Britain's finances have been given a double boost after upbeat forecasts from two leading analysts as Government spending cuts loom.

Credit rating agency Moody's said the UK was able to meet its fiscal challenges and keep its AAA status despite a tough economic climate ahead.

Moody's said a stable outlook for the rating was due to the Government's commitment to stabilise and eventually reverse the deterioration in its financial strength.

The Treasury is planning a series of austerity measures, where it will cut public sector spending in an attempt to reduce the UK's massive debt level.

Moody's added: "Government debt is also well-structured, thus limiting re-financing risk. Moreover, the UK economy appears sufficiently flexible and robust to grow moderately."

The firm said the global financial crisis in 2008-09 had caused "serious long-term damage" to the country's balance sheet and the state of the banking sector was still "uncertain".

This, coupled with slower growth among the UK's main trading partners, was "not conducive to allowing GDP growth to return to its pre-crisis trend rate", it added.

But it also implied the top credit rating was not expected to change in the foreseeable future.

However it did warn the UK is still vulnerable to further economic and stock market shocks, which could themselves threaten the AAA status.

Meanwhile, a top economic consultant group has said the world is not in imminent danger of heading back into a double-dip recession.

But the Centre for Economic and Business Research (CEBR) has revised down it forecast for global GDP growth for 2011 to 3.4% from 4.1% predicted three months ago.

The main reason was a downgrading of the prospects for the US economy, where growth is forecast to fall to 2.2% next year after hitting 2.5% this year.

CEBR chief executive Douglas McWilliams said: "I would be prepared to bet one of my better shirts on there being no global double dip.

"Although their growth will be affected by slower growth in the West, the emerging economies are too resilient for global growth to go negative again in the short term."

Report author Owen Hames added: 'The weaker outlook for the world economy means that despite food price inflation we do not see interest rate rises in the US, the eurozone or the UK for most of the next 12 months."

From the Evil since 2009 Murdoch News Source

[drat01]

From the same source

Hard Times For Brits - And Getting Harder

Economic conditions for the average Briton took a turn for the worse last month as the cost of living went up more quickly than earnings, figures compiled for Sky News show.

Sky's Hard Times index fell to 94.1 in August, down from 94.3 in July - which already represented the toughest economic environment since the end of the 1980s recession.

The Hard Times Table is compiled for Sky News by Oxford Economics and takes into account factors including inflation, wage rises, benefits and the level of government spending.

Andrew Goodwin, the consultancy's senior economist, said: "The index fell for the nineteenth successive month in August, further increasing the squeeze on households.

"We are continuing to see inflation comfortably outstripping growth in wages, which is eating into consumers' spending power."

He added: "We expect to see the index falling further over the coming months.

"The impact of the public sector cuts has barely shown up in the index so far, while the pattern of high inflation and low earnings is likely to be with us for some time to come.

"January's VAT rise is likely to keep inflation well above the 2% target, while the threat of further increases in unemployment will continue to push down on wages.

"Household finances have been under strain for some time now and there is no prospect of any let up in the near future."

So basically keeping that mythical credit rating means bugger all to the man in the street.

[tonyh29]

Whilst not directly I believe it's loss would lead to an increase in the price of commodities, goods and services which in turn would result in higher inflationary pressures ?

[cheltenham_villa]

Work wise we've been flying for the last few months, almost at the same level as pre recession, annoyingly weve had a really quiet three weeks just before annual pay rises.

[Genie]

Work wise we've been flying for the last few months, almost at the same level as pre recession, annoyingly weve had a really quiet three weeks just before annual pay rises.

What industry are you in if you don't mind me asking?

[tonyh29]

£8bn would have come in handy ...

1999 Brown sold 395 tonnes of gold at an average price of $275 an ounce. It hit a record high of $1,281 an ounce last Friday. Those 395 tonnes would now be worth an extra £8 billion to the public purse.

[Gringo]

And what would you do with it? Sell it?

[tonyh29]

Well I'm not qualified to make that call but I did find on Amazon "Chancellor of the Exchequer for idiots" and one of the pages covered

You have a shit load of gold .. do you

A). Sell it when it's at an all time high ?

. Sell it at rock bottom prices below what you paid for it