Quote:
Originally Posted by Rebelrc
This thread is rubbish
No ones biteing lol
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Afraid your bait is not very good, and the hook is showing through so we can all see what you're doing!!
Quote:
Originally Posted by Si Coe
Whilst I don't want to delve into the details or the debate, the simple fact is some people have profited from all of this. Including amongst others senior bankers and investors that gambled away other peoples money and rather than be sacked have retired on generous golden parachutes.
In essence in bailing out the banks we have paid for these peoples cushy futures whilst screwing up our own.
Its the simplest economics of all - if you are getting poorer, where has your money gone? It doesn't simply disappear!
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This is capitalism, the economic model that has won the contest of the last 100 years. Communism and co-operatives have failed, capitalism has won. In a capitalist economy, someone has to win and someone has to lose.
This all started in 1987 with Big Bang, when the much-worshipped and admired Margaret Thatcher did two things - allowed the banks to combine trading of stocks with the provision of investment banking advice and financing. Governments around the world lowered the capital requirements of banks - the amount of capital they needed to back the loans they made - so we all had ready access to loads of money and we borrowed like hell. then we couldn't pay it back, so the banks had to increase their capital reserves to cover the bad loans which meant they couldn't lend as much to us - the credit squeeze of 2007/8.
At the same time, a lot of the credit instruments they created were proved to be worthless, so banks could not pay what they owed to each other (the trading of money to make money) and to avoid collapse, Governments lent them the money they needed to meet their capital reserves. If they didn't, then they would go bust taking our savings and deposits with them.
Because we couldn't borrow money (including small business) we didn't spend as much so we entered a recession. In a recession, the Government's income goes down, so taxes have to go up to pay for the shortfall. As the Blair/Brown, and Bush Governments had been spending like crazy (us on the NHS, Education and local services, Bush on wars in Iran and Afghanistan) there was no instant alternative to cutting Government spending.
To make sure this never happens again, Governments further raised the capital reserve requirements on banks, so they are still busy raising this capital which means they have no spare cash to lend to anyone. Government tries to remedy this by pumping more money into the economy by making ever larger loans to the banks - quantative easing. We have to borrow this money, we issue more bonds, we have to pay more interest. At this rate, by 2014, almost 15% of our taxes will go to paying interest!
So, no, your money does not disappear. If you don't get a pay rise, and you can't borrow money, you can't get richer. In a recession you don't get a pay rise and your taxes go up, and in a credit squeeze you can't borrow money easily. Your money hasn't gone anywhere, it's just that you can't get enough to keep up with the rise in costs.
And just in case anyone is left with any good feelings about Margaret Thatcher, she was also the one who ran down our manufacturing industry in order to break the Unions, who decided that was not a problem because we would become a service and finance economy, and then privatised the utility companies because she said we needed more competition to drive down gas electricity and water bills!! And it was Gordon Brown who decided to tax the dividends paid into our pension funds which has led to them being decimated and us having lower pensions!
You can wind us up all you like Rebelrc, but this is what happens when you live in a capitalist economy. There's a rational explanation for it all, providing you don't believe what you read in the papers. That's all folks!!