I've just finished reading Niall Ferguson's Civilisation. I think that quite a few people on here would find it interesting and informative. He examines what made Western dominance and whether it is likely to continue. To Pete1950: knowing that the bloke you borrowed money from can count it as an asset is of scant interest and consolation if you are in debt. The fact that the Arabs and Chinese are getting richer, and the West poorer, whether it balances nicely on a world balance sheet, doesn't change the precarity of the countries borrowing their way out of trouble. If the West has decided that manufacturing ought to be carried out by the developing world, it needs to come up with an alternative. That alternative has been traditionally touted as brainpower and added-value goods and services. Fine. But in that case, to support that strategy, you'd have to have a manifestly better eductation system which supported the quest for added brainpower. Sadly, it seems that places like China, South Korea and Japan score better in tests of eduction than the UK and Europe. OK then, we still have the best universities. Well, we do, for the time being. But we encourage people from the developing world to come to them and benefit from them. Frankly, if you want to see all this as a struggle of civilisations, you'd have to think that Europe is already on a trend to poverty, whilst the developing world is on a path to affluence. Our loss is their gain. It's all going to be a lot "fairer" on a global level, but if you're used to living at the rich end of the spectrum, you and more particularly your kids, are in for a surprise.
I wonder if this thread is also running on Ducati Forum Netherlands except it may well go "Bloody Brits, over here schmokking our dope and banging out hookers on the unemployment benefit way pay them. Fecking holiday camp here. They don't get 90% of their salary back in UK you know. More like £60 quid a week." If you don't like the reciprocal arrangement then vote UKIP and leave the EU. You can't have it both ways
I wish people would take a look at civilisations in history -- Look at the magnificent buildings that were in Rome, Paris, London, Prague, Moscow.....in fact anywhere you like where money ruled........then think how did the craftsmen produce the buildings and details with a few hand tools. Now look at the same buildings in rapid decline and the buildings that are thrown up in their place...........the European civilisation is in a serious decline far greater than what struck Rome, whilst what we used to consider to be 3rd World are on the rise.......
Grand architecture came about during periods of time where social responsibility was not a priority. The welfare state and workers rights reduced the capital available for such magnificence -Whether that be the Roman empire, Byzantine empire, Han dynasty or the British empire. Far Eastern countries now have a surfeit of capital available for buildings etc but very little (in percentage terms) put aside for social care /welfare.
You mean, its not a bad debt.....yet. wait until interest rates rise, the BoE stops printing money etc.......house price crash 2 coming your way.
You are right, but in the meantime those that have power are lining their pockets and will be able to take the hit, unlike the average man in the street.
That's true, but my point was that various posters were blithely talking about debts as though they were purely negative phenomena without any corresponding positive factor. I was trying to drag this back to reality. A large part of UK government debt constitutes the assets of insurance companies, pension funds, banks, etc. Furthermore, the UK government owns a large quantity of land, buildings, equipment, vehicles, ships, etc. of great value. So the attempts to shock and horrify people by mentioning large figures of national debt are a little overblown.
It all really comes down to debt servicing, doesn't it? After all, you can borrow indefinitely if (a) you can afford the interest and (b) your lender doesn't want the capital back. We will assume that (b) isn't really a problem for a government. So then you end up with (a). It's a bit of a pity if large quantities of tax, which could be buying any number of useful things just go on interest. Rather like a family with maxed out credit cards spending all their available cash on paying off interest on them, their personal loans and their mortgage. The mortgage isn't such an issue, as the alternative is rent: lucky are those who don't have a mortgage and thus live rent free, but they can't be that numerous. I don't know offhand what % of tax is spent on servicing the national debt, or what this is likely to rise to. There are some figures in Ferguson's book which sound a bit alarming, ie revolution and state collapse has always followed when interest payments reached unsustainable levels. Maybe someone would like to tell us what the current scenario for the UK is. The only real answer, it seems to me, for the UK to have a bright future is to educate ourselves out of trouble. And that, people, is going to take some real education reform.
The dutch are notorious for no contribution, no funds, sleep on a bench and die. And I'm sure they love all the revenue from us going mad with drugs and beer. Lets not let the facts get in the way, eh ;-)
What ? The government isn't a lender, it is a borrower. Why wouldn't the bond holders want their money back, if not just to roll it over ? Although admittedly QE has just been conjouring money out of thin air. Also our people can all be highly educated but if we continue to buy our high ticket items from overseas because they are cheaper then what will change ?
But all money is conjured out of thin air, as you put it. What do you imagine money is exactly, then?
Education + creativity = innovation Innovation + business sense = wealth creation There is still a lot of stuff to sell to the Chinese, one of the reasons they are so keen on shopping in London and Paris. You don't imagine the stuff is cheaper than in China, do you? There are also more things to be sold than just consumer goods of the textile and electronic varieties, and even those can be sold. Viz, there is a lot of high-end stereo equipment made in Europe, particularly England, Swiss watches are big sellers in Asia, French wines ditto, single malt Scottish and other luxury drinks. Europe can still do luxury goods, and the brand appeal brought about by decades of savvy marketing makes them highly desirable. I suspect you'll find that most rich Chinese aren't driving Chinese cars, either (or bikes, come to that).
Sure but all of that will create wealth for the minority, what do the unskilled do ? Previously they would have worked on the land, in shipyards or coal mines as labourers. As industry has become more efficient the promise of more (quality) leisure time has not been realised, the rich have become richer and the rest have been squeezed.
We should have done what Iceland did. Let the banks fall and jail the bankers. Little wonder it all went tits up http://www.darkpolitricks.com/2013/01/who-owns-the-bank-of-england/
The land, coal mines, and shipyards? You've been reading history books - those particular problems arose many decades ago, and were dealt with for good or ill.
