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| Government debt rises to a record of £1tn https://b65a9t-westlondonchatcom-7590.site.tb-hosting.com/viewtopic.php?f=1&t=75 |
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| Author: | geezer466 [ Tue Jan 24, 2012 9:37 pm ] |
| Post subject: | Government debt rises to a record of £1tn |
http://www.bbc.co.uk/news/business-16698293 Even with the current 'cutting strategy' the Government are unable to bring down the borrowing requirement. It's currently around £16000 per capita. Think of it as mortgaging your children's future and we have to paddle hard just to keep still. Governments generally spend more than they raise by taxation, they borrow the rest. That works so long as people (here and abroad) have faith in the ability to pay the interest. If the credibility fails and the emperor is seen to have no clothes, the music stops and the sky falls in. Possible consequences range from merely rampant inflation, industrial strife and civil unrest to civil war, revolution, and international wars. Sterling has devalued against the $ 30% in recent years as a result of quantitative easing which is also fuelling inflation. The UK is sliding spectacularly into the smelly brown stuff. The situation is getting worse not better. Cuts to date and proposed policy such as a benefits cap really are minuscule measured against what really needs to be done. If there was a Sterling crisis tomorrow defined by the UK being unable to sell its gilts on the open market we would be forced to go to the IMF and make eye watering cuts to both welfare spending and public services. Cuts which undoubtedly would lead to much civil unrest. http://www.debtbombshell.com/ This blogger thinks that the world won't end if a country defaults but they'll have a very painful adjustment period learning to live within their means. |
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