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QuizteamBleakley · 24/08/2015 15:00

I am SO bloody clueless about how this may affect our economy. I get that the FTSE has had a load wiped off it but what does it all actually mean? I'm suitably embarrassed that, even after reading these two articles, I'm not fully understanding how it will / may affect people in the UK.

Can anyone spell out what's happened?!
I'll contemplate going on AIBU to get flamed for being utterly in the dark!

BoomChickenSoup · 24/08/2015 15:13

I'm not sure what the consequences will be either but I'm guessing that nobody else knows either.

JanetBlyton · 25/08/2015 15:34
  1. If you were about to draw a pension it might be three quarters what it otherwise might have been for example.
  2. If you have your money in shares then you will have lost a lot of money

More generally it probably means interest rates will stay low for 2 more years rather than rise so property prices will therefore not drop so those waiting to buy will find it not worth waiting for prices to reduce.

Hackersschmakers · 25/08/2015 15:52

Well, if you believe an article I read today by someone I can't remember the name of, we should all be stockpiling food and water while we wait for apocalypse conditions.

Otherwise, unless you have shares I don't think it really means much in the short term.

cdtaylornats · 25/08/2015 17:35

If you are in a pension scheme you have shares. However the various markets seem to be rallying today. I do wonder why the traders seem to run scared every time anything happens.

blacksunday · 25/08/2015 19:24

The global economy is going to suffer another major crash, worse than the 2007 crash within the next few years. Our economy is insane.

Isitmebut · 26/08/2015 10:35

Think how “insane” the UK economy would be if after several industries here were nationalized, the UK taxpayers would have to give back their tax breaks (and then some) and see more potential government spending cuts, for the government to SUPPORT the businesses they own during any financial/economic crash – as that was the dilemma/choice the last administration had from 2008 when the Public Sector etc had grown to around 54% of our economy – so were unable to help those taxpayers when ‘real’ inflation adjusting earnings began to fall.

The UK banks are far better capitalised that in 2008, our businesses far from waiting for the NEXT annual government tax rises, have been given help from 2010 and have a government more responsive to their problems, which should mean fewer private sector job loses if ‘stuff’ keeps hitting the fan.

Central Banks since 2008 have far more monetary tools in their tool box, so can react a lot quicker than they did from late 2007.

The stock markets came off their lows around May 2009, so have had a good run, and while tough to price in company earning and other fundamental within such volatile markets to judge when BUYING will add firm fundamental support for the markets, the P/E etc Yields on stocks already attractive versus bonds, will not make professional stock market fund managers start to buy soon – especially if government and other bond yield fall further (where fund managers will switch out of bond holding into equities for yield pick ups) and those fund managers, already very flush with cash pre crash, put that cash to work.

China as the 2nd largest economy in the world, is slowing, it needs the official 7-8% GDP growth a year just to stand still, but as closer to 5% and trying to manipulate China’s economy to move away from reliance on exports to domestic consumption (a plan that included a domestic stock market tied to a rocket), no one can tell how far such a government ‘controlled’ economy, can fall further.

The U.S. largest economy in the world is doing well e.g. best job prospects since 2007, and so are we versus Europe, the question is how much growth/demand there is in the world to pick up China’s etc slack.

The fall in all commodity prices, heavily influenced by the fall in China’s demand we never really had after the 2008 crash when China had double digit GDP growth and buying up commodity supplies for the future, will help the global economy recover, as while not good news for Producers, for business and retail Buyers the likes of U.S oil at $39 a barrel and Brent $43 a barrel (down from $120 when Scotland was pricing their independence financial future), would help - keeping both inflation and interest rates lower for longer.

Isitmebut · 26/08/2015 10:38

The above should read ......."the P/E etc _Yields on stocks already attractive versus bonds, WILL make professional stock market fund managers start to buy soon"

squidzin · 26/08/2015 12:21

I would have thought that if we are to face another 2008 style capitalist catastrophe so soon afterwards, then things will start looking obvious. Most people will have had enough of being so vulnerable to the whims of private investors.

Nationalized industry brings with it a predictable, cheaper cost of living.

Boom and Bust belongs to capitalism.

Isitmebut · 26/08/2015 12:45

Squidz .. Re the Public Sector i.e. NHS, education, police, any Nationalised industries, Welfare, Benefits, JSA, State Pensions etc etc etc - why does socialism have a mental block on who pays 100% on the bills, the private Sector - that would not exist without capitalism?

There is NO honking forest of Money Trees, you lot really need to get your head around that.

The FACT the current global problems are emanating from China, THE largest and most government controlled economy on this planet, ever, no doubt escapes your theory.

China tried under Chairman Mao Tse Tung the non capitalist route, somewhere between 20 and 45 million Chinese citizens died for various reasons including starvation.

Chavez in Venezuela, aided by oil (the UK has) was probably the most recent example of a State controlled anti capitalist society, do a bit of reading to see how that turned out for the masses, once the money ran out.

Isitmebut · 26/08/2015 12:48

P.S What happened to Russia's state industries?

Each old for a Rouble to politically favoured oli...olyg... rich Russians.

squidzin · 26/08/2015 14:12

No one is talking about communism-socialism though are they?
"You socialists need to get you head around..." What, that communism is crap?

Yes, and those responsible in China thought wrongly that they could keep a stock market artificially inflating forever without understanding that Boom and Bust is inevitable.

China is collapsing because the govt thought through A-Shares and manipulation and propaganda they could keep the stock market growing for ever.

Who's talking about Putin's russia? ?
No one.

What we need is a balance in a French-Scandinavian way that recognises the benefits of socialism while also understanding the boom-and-bust nature of capitalism and acts to protect it's citizens from the effects rather than fling them headfirst into the mouths of sharks.

If you are subliminally trying to compare Corbyn to Putin, that's crap.

Isitmebut · 26/08/2015 14:56

"What, that communism is crap?"

No, very basic, WHO pays all the bills for the basics, never mind the 'nice' things - Corbyn, pro war, bare chested, riding his horse while performing martial arts - yes I can see a comparison. Guffaw.

"What we need is a balance in a French-Scandinavian way that recognises the benefits of socialism while also understanding the boom-and-bust nature of capitalism and acts to protect it's citizens from the effects rather than fling them headfirst into the mouths of sharks."

Scandinavian countries are generally population wise much smaller (5 - 10 million) and don't start me on basket case France (we recently over took as the 5th largest economy) citing French 'productivity' and how it protects workers - when they have twice our unemployment, a third of our economic growth, DUE to policies 'looking after' their workers.
www.bloombergview.com/articles/2015-06-11/france-s-economy-might-boom-without-dumb-labor-laws

"It (France) has also been stuck in an economic funk for decades. Since 1990, according to the Paris-based Organization for Economic Cooperation and Development, France’s per capita gross domestic product has grown more slowly than that of any other wealthy nation but one (Italy). The country’s manufacturing output today is lower than it was in 1990."

squidzin · 26/08/2015 15:11

Ok, while you obsess over GDP (which is proven to only benefit the top 10% wealthiest) there are other measures of a country's economic success.

French-Scandanavian Childhood happiness, lower levels of suicide, socio-family cohesion and lower drug/alcohol abuse, lower domestic violence to name but a few. A healthcare system socialist/private hybrid to surpass ours in efficiency and quality, state provided childcare unrivalled by any other nation, but Boo Hoo the wealthiest don't soar wealthier.

Haha at twice our unemployment since we have re-defined true unemployment figures in our country we even have the term NEET (unrepresentative unemployment IOW).

squidzin · 26/08/2015 15:13

(I would sigh to see Corbyn bare-chested on horseback)

Isitmebut · 26/08/2015 15:15

(I would like to know if he ever takes his vest OFF)

Isitmebut · 26/08/2015 15:35

"French-Scandanavian Childhood happiness, lower levels of suicide, socio-family cohesion and lower drug/alcohol abuse, lower domestic violence to name but a few."

If I could be arsed, I'd ask you to qualify some of those claims, especially Scandinavian suicides and drink, and I'd suggest that alcohol abuse here climbed after Blair decided that we needed longer opening hours - to enjoy a UK cafe type culture as seen over the channel - how DID that work out with more hours to get legless.

As for any 'nice' things in France, in 2010 while we had a £153 bil annual overspend France only had around a Euro 60 billion overspend, so I'd suggest socialist France had been spending more wisely than socialist UK.

Fast forward to now, we have a £70 billion overspend, theirs is around Euro 90 billion - the point being, with their annual deficit/overspend still growing, France still have their spending cuts to come.

Re UK unemployment versus anyone else, please provide qualified facts to show ours in not around half that of the whole Eurozone, never mind France e.g. "NEETS" comparing unemployed 16-24 years old under Labour in 2010, versus now. Clue; it was around 500,000 in 2004, around 700,000 in 2007 (pre crash) and nearly 1 million by mid 2010.

squidzin · 26/08/2015 17:41

We all know the DWP fiddle the true number of unemployed by forcing many to register as "Self employed"(unearning) and why bother creating a whole sub-section called NEET just to put them in a different category? Under Thatcher the definition of "unemployed" changed at least twice a year and surprise surprise each change brought a drop in numbers. Cameron's tactics are equally transparent.

Unemployment has been off-set by Zero hours contracts which have escalated under the Tories but are not permitted in France or Germany or Italy or Sweden or anywhere where workers rights are protected in the slightest.

The UK Has the highest alcohol problem and lowest happiness record. In your own language from your very own Daily Mail.

www.dailymail.co.uk/health/article-3077006/Strewth-Australians-drugs-Britain-biggest-alcohol-problem-Study-reveals-world-s-vices-country.html

Unemployment has not improved under the Tories. They have indeed defined the definition to suit their agenda.
www.theguardian.com/politics/reality-check/2015/mar/31/has-david-cameron-really-created-1000-jobs-a-day

Reducing a mythical deficit is a capitalist ideological wet-dream creating a desperate exploitable cheap labour market to inflate profits and advantage the wealthiest top 10%.

France do not have major collapse to come because their economy is stable, expenditure is growing in line with income and receipts.

blacksunday · 26/08/2015 18:45

squidzin -

Seriously: don't waste your time with isitmebut. They're a full-time Tory propagandist and compulsive liar.

They have no interest in honest debate. Just ignore them.

squidzin · 26/08/2015 19:41

Yes but I couldn't help it. My bad. Grin

Isitmebut · 27/08/2015 12:36

Hey, it’s the leftie ‘Chuckle Sisters’, broadcasting their ideologically based ignorance, in stereo. lol

Black Sunday I’m far more likely to debate a subject to death, using the ‘honesty’ of FACTS over red rose tinted ideology, which is usually when you run a mile – at least squidzin has a crack at a debate rather than dumping increasing ‘black’ and twisted propaganda and moving on to the next website.

Isitmebut · 27/08/2015 12:40

squidzin ….. you are again only seeing what you want to see, starting with everything here is shite, whereas in the Eurozone everything is OK, which is factually 100% incorrect.

Firstly the Guardian link you provided CONFIRMED everything I said re the job creation and how much better the UK is doing versus the Eurozone, but they then mention “worrying trends”, some of which you mention e.g. the rise in ‘Self Employed’, when we are increasingly in a digital/internet age where people can work from anywhere and if hasn’t changed, it can be more tax efficient to take a salary as an annual company dividend, plus other tax allowance perks.

Next this myth about unemployment being “offset by Zero Hours”, that no one seems to know what the figure was in 2010, in fact for a Contract that began in the late 1990’s, no one in Labour appeared to give a shit they existed, as I can’t even find it in their 2010 manifesto – and what was the recent count, around 600,000, many wanting that flexibility and some having two contracts – and that rose from 2010 by how many?

As for the UK versus the rest of the Eurozone, percentage wise, the UK has far, far, fewer non permanent workers than across the channel, and the last time I looked, the UK’s permanent job add per month was around 80%-90% of total.

Are you seriously trying to tell me that far more European workers on temporary contracts, really have more ‘rights’ than here?????

Aug 2015; ”The New World of Work:recovery driven by rise in temp jobs”
www.ft.com/cms/s/0/b2171222-31e4-11e5-8873-775ba7c2ea3d.html

”They call it the “precariat”. In a continent known for strong employee protections, more than half of the eurozone’s young workers are in temporary jobs, churning from one shortlived contract to the next.”

”In France, permanent jobs account for just 16 per cent of new contracts, down from a quarter in 2000. In Spain, almost seven in 10 young workers are on temporary contracts. The share of the eurozone’s 15 to 24-year-old workers who are temps is the highest on record, at 52.4 per cent.”

”Now that the eurozone’s recovery is at last under way, the question facing policymakers and politicians is whether the painful reforms of the last few years will do anything to address this.”

”But in parts of Europe, where temporary and contract work is unusually pervasive, economists say there is a dark side to the trend.”

”A deep fracture has emerged in Spain, France, Italy and Portugal over the past 20 years, with an older generation of highly protected permanent employees on one side and a younger generation forced to settle for insecure jobs on the other. That is one reason why youth unemployment surged when the crisis hit.”

“The rules for open-ended contracts in Europe are considered too stringent by employers and they sidestep those regulations by creating non-regular jobs,”

If you really want to see an unsustainable employment stats ‘fix’ destined to fall apart at the first major recession, I’d look at the 13-years before 2010.

Looking at the FORTH CHART on the link below where government employment from the early 2000’s rose in percentage terms more than the private sector, and when the private sector jobs were being lost during the crash, the Labour government then tried to mask the figures by going on a government/public sector HIRING spree – when they should have been looking to CUT the costs of government and give the masses tax breaks to offset the fall in real earnings from 2008.
www.bloombergview.com/articles/2014-12-22/uks-holiday-cheer-in-four-charts

Re “the mythical deficit” the above losses of tax paying jobs and creation of 100% tax funded jobs goes someways to explain the size of the 2010 budget deficit, which fyi is calculated like in any household, by deducting your annual expenditure from your income – so its neither mythical or rocket science.

Isitmebut · 27/08/2015 15:14

Back to the Black Monday thread subject.

I see the markets are continuing a bit of a bounce from yesterday as the stock short sellers no doubt are covering part of their position and stock market value hunters step in.

Traditionally August being a holiday period, when many senior decision makers are out of the office, can also add to the volatility - but there is potentially technical support (based on stock charts triggering activity e.g. over sold buy orders) as well as fundamental support based on dividend yields for income investors etc, coming in here.

From the widespread sell off, as we enter September the stock markets should concentrate on the individual companies within each country that are badly affected by a potential slump in China e.g. I saw recently that Suzuki will half production in China, and General Motors in the U.S. would suffer as well.

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