Osborne's latest attempt to kick start the economy will cost £100 billion. These huge numbers fly about in the columns of Newspapers, but few of us really comprehend them. What does £100 billion mean in tangible terms.
During the fiscal year ending in 2011, the NHS cost £100 billion. The education budget was less; some £58 billion, while defence expenditure was just £37 billion. So, £100 billion is really big number.
Notwithstanding Osborne's excitable language about firepower and kick-starting the economy, we have to wonder where this cash will really go. I have a sneaky feeling it will end up supporting the balance sheets of banks. Ultimately, it will leak out as bonuses to bankers.
We know it; they know it; they know that we know it; we know that they know we know it. Everyone has full information. No one is keeping any secrets here.
Yet somehow, nothing ever changes.....
9 comments:
money (and debt) WILL be devalued.
George Osborne said it would "inject confidence into the financial system"
George Orwell & 1984, really happening in 2012
Yup - all this will do is de-value the pound even more.
The pound in your pocket is worth less EVERY time they 'create' money out of thin air.
They can spin it anyway they want...but thats the end result.
This is the main reason you are seeing HUGE rises in food prices etc.
Its also being done(in my opinion) to keep house prices high. Real estate basically IS our economy now...and they cant let that bubble burst.
Ultimately though, they are just delaying the inevitable.
What's the alternative?
I'm struck that the coalition is just carrying on the stupid policies of G Brown. Is it really impossible to announce that they were dangerous folly, and change tack?
Absolutely agree that it's robbing the population by devaluing the currency. It's also trying (they will fail) to perpetuate house price inflation. And there is now no excuse since we have several years and a lot of billions to prove that it does not work. And by the way, did anyone see today's trade figures - perhaps devaluation doesn't work after all then?
The banking system is the heart of the economic system and it must be in good health - liquid and lending - in the face of major local challenges and international riptides. As the brain of the outfit, the Government is right to shore this up...but needs to assert the conditions on which taxpayers largesse actually feeds through to the Arms, Legs, Organs - the business end where everything in the real economy actually happens.
Two shocking truths need substantive attention: (i) Nothwithstanding the inflationary/devaluation damage from the programmes, the magic ‘cheap’ liquidity (QE, this new scheme) hits the road-block of complex procedures and excessive (verging on gouging) charges for companies to access that finance. Until fixed, money in will not translate to money out of the banks. In which case, all the damage is done AND without the intended gains. (ii) We don't sell enough outside Europe (more to Ireland than BRIC etc) and current efforts really are more noise than trouser. A FRACTION of the funding put behind the BoE scheme to instead fund a practical, comprehensive programme of trade exhibitions by technology/manufacturing UK SME’s in fast growth markets will have a multiplier effect on real business growth today and tomorrow.
UK plc could also avoid shooting itself in the foot. In same breath that the Marine Industries Alliance (a Government led programme) proclaimed our world class industry will galvanise to grow from £17bn to £25bn in 8 years – nb no plan attached – the UK MoD was confirming the order (itself a rarity) for 4 UK designed tankers to be built in South Korea. These contradictions are costly in jobs, income and tax revenue for the economy and damaging to our reputation and future prosperity.
Ahh. That’s better.
Post a Comment