E.U: Leave or Stay? Your thoughts.

In fact there is an argument that the EU saved the world from the 2008 Credit Crunch being a lot worse. It was because the banks of 28 member nations could act quickly and in unison under the EEA framework (under Gordon Brown's urging, who quickly realised that only a massive refinancing of the banks was going to stop the world heading for a full-on Depression), that a lot of damage was prevented. Had they been 28 fully independent nations, getting them together in a forum and acting in coordinated action wound have taken months.

And make no mistake: anyone who really understands what actually happened that year, says that Gordon Brown arguably saved the world. The reason he is not seen that way is because the general public doesn't really understand what happened, nor the role of his actions in this.

 

What happened is pretty simple although with all the rhetoric that gets thrown around it's hardly surprising people are confused, we increased the supply of money by typing something like £12 trillion into various computer systems across the world and that made people less likely to hold onto what they had in the hope that it would be worth more tomorrow than today.

And when i say typing it was literally that, yes it maybe covered up in complicated accounting and buying this or selling that, but in essence the world magicked over £12 trillion into existence (iirc the UK plucked £2 trillion from the tree that doesn't exist).

 

While it created the required cash flow to resuscitate the economy it will bite the UK in the arse in the long term due to the lacklustre pensions system that relies almost entirely on private savings for anything beyond the pittance of the state pension.
But on the bright side, we will be a leading exporter of Soylent Green

 

It wasn't just the UK who increased the supply of money, most of the western world did the same (afaik), as Nexxo pointed out it was only that that prevented a rerun of the 1929 great depression where GDP worldwide fell by around 15% compared to %1 in 2008.

I can't say i know anything about how, or even if, it will effect the pensions system as it's not immediately obvious to me how increasing the total amount of money in the system makes any difference to private savings, if anything it probably prevented negative interest rates.

 

Hmm the UK didn't fair particularly well though, it dropped 5.8% in the 30s and 6.2% in 2008-9, ironically Labour got the blame in both scenarios
There is a certain school of thinking that the banks should been left to fail as thats the naturally what should happen in a capitalist system to keep checks on the system.


Depends how the pension is invested, if it's in anything asset based it will have increased by quite a healthy margin.

 

As you said yourself, people spending instead of saving.
And yes, in the short term it was necessary to jump start the economy.

The problem is that the UK until recently didn't have forced pension contributions based on salary unlike many other developed nations (and our current ones are far too low still and allow opt outs), making it a two pillar system (state pension funded through general taxes and private savings) where as a lot of the developed world has a three pillar system (state pension + forced salary based pension contribution + private savings).
Which means that encouraging a spend now instead of save for later mentality to jump start a failing economy will affect the UK far worse in the future than for example Germany.

 

I don't recognise those figures, in 30-31 it was 0.89 - 4.97% and in the 08-9 it was 0.5 - 4.2%.

It's pretty pointless comparing a single country across the years though as the differences (unemployment, leaving the gold standard, wars, etc, etc) distort the comparison to such an extent that focusing on a single country losses meaning, it's why i used global GDP.

If we were following the capitalist system then yes they should've, however that most certainly would've made the situation worse, it's why the deregulation of the financial markets in the 80's was such a mistake IMO.

Considering the value of an asset is only afforded its value via a currency, entering a deflationary spiral probably wouldn't have been good, it would've meant the value of your asset would be worth less tomorrow than today.

 

Meanwhile, a little glimpse from Honda's perspective on the UK leaving the EU and the CU:

 

Don't worry, Brits will be so down on cash, you won't be buying Civics anymore, you'll be back to Rover Metros.

 

We do have forced pension contributions based on salary, it's called National insurance.

The FT is being highly optimistic there, it can take weeks (3-4) for goods coming into this country from around the world to clear customs, the only reason we don't notice it is because most of that clearing is done while the container ship is in transit.

Obviously with Europe only being an hours journey away (if that) there's no possibility of getting the paperwork done before said container lands on our shores.

 

Fair point its semantics.

Things would've been worse short term but with decent govt intervention (prevention of eviction from primary residents etc) thing would've bounced back faster and the wealthy would've taken more of the hit.
Although saying that the rich always come out on top so I guess the above would never happen.

 

National Insurance is essentially just income tax and while it does pay for the state pension (which is an utterly laughable amount) it also pays for a whole host of other things like JSA, NHS etc.
I meant one where you actually also get more back if you pay more, like other countries in Europe have.
The closest we come to that is what was introduced a couple years ago, but it takes so little in contributions (and allows opt outs) that it is almost meaningless and won't help the millions of pensioners that will be in poverty in the future.

 

Darn it i spat my tea all over the monitor.

Some people would kill for £125 a week, iirc the disabled and people looking for work get quiet a lot less and arguably their needs are greater (the former may need to pay for extra help and the later has travel expenses).

And yes NI is basically another tax but as taxes don't fund central government spending it's rather academic what it's meant to notionally be funding.

 

Well, since I was the last person to moan about bureaucrats, it doesn't take a genius to figure out who you were referring to.

Seems to have done a reasonable job of reducing the national debt in Greece oddly enough ( along with billions of Euros in bail-outs ), though I doubt the populous would appreciate that fact.

 

True enough, the birth to retirement benefits system could do with a serious overhaul as well.

On another note:

The new government in Spain said it will join others like France and Germany in blocking UK from cherry picking:

https://www.theguardian.com/politic...will-block-mays-single-market-plan-says-spain

Yes and no since it could have been avoided by taking much less drastic action earlier instead of waiting until it was too late and it was the only option left.

 

Psychologists say everybody is the hero and martyr of their own story. But no, I wasn't talking about you.

 

I was wondering when we'd see @Sajuuk join us here

 

Greece is not a monetary sovereigne nation, they gave up those powers when they joined the Euro (stupidly IMO), as such the only choice open to them was to cut spending as the ECB wasn't willing to bail them out because it didn't want to devalue the Euro or increase taxes to offset the resulting increase in inflation.

TBH i can't blame them, Greece got themselves into a mess and it's hardly fair to expect everyone else to pay for their mistakes.

 

Of course you weren't dear, that's why you directly replied to me with that post & only bought up the issue of moaning about bureaucrats directly after I made my comments- it's just one big coincidence, definitely.

Haven't you got a database to bork or something? Last time I checked everyone was free to join the discussion- though apparently not. I'll leave you guys to it, the salt levels in here are far too toxic to endure any longer; I'm looking at the tags at the bottom of the page and I think I see everything I need to know about the people in this thread.

 

Whoa there Nelly, that ain't the way we do things round here in Serious. My point was that I was interested to see what you had to contribute to the discussion - because that's what Serious is for: discussions. You will be challenged on your opinions, you will be challenged to back up your claims, and you will be challenged on things that you might think are facts. That isn't being salty or creating a toxic environment, that's having a rational discussion. There is a difference between criticising an argument and criticising the person who makes the argument (in fact the latter even has its very own logical fallacy, it's an ad-hominem). It can sometimes be hard to distinguish, but I can guarantee you that the vast majority of people here are not trying to personally insult you.

Sometimes people might come across as dismissive in this thread but please do bear in mind that we're all fallible humans and this thread has seen many an argument come and go in its two year history. I'm not asking you to read every single page, just bear in mind that many arguments on every side of the fence (and some arguments from those still on the fence) have been discussed.