Mavideol Posted September 24, 2022 Share Posted September 24, 2022 4 hours ago, bannork said: I could tell you a joke about trickle down economics but 99% of you wouldn't get it . come on, give it a shot, you may be surprised 555 Link to comment Share on other sites More sharing options...
metisdead Posted September 24, 2022 Share Posted September 24, 2022 A post with a trolling image and the replies have been removed. A post with content that was copy and pasted from some site without a link has been removed. Some posts attempting to hijack the topic into the discussion about the Truss election etc have been removed. This topic is about: Bank of England raises rates to 2.25%, despite likely recession 2 Link to comment Share on other sites More sharing options...
Popular Post bannork Posted September 24, 2022 Popular Post Share Posted September 24, 2022 3 Link to comment Share on other sites More sharing options...
Popular Post kickstart Posted September 24, 2022 Popular Post Share Posted September 24, 2022 16 hours ago, Mac Mickmanus said: Really no need to bring the guys Parents into the frame and their African origins , that could be considered to be racist . The measures KK took were necessary and predicted , when the USA raised their interest rates a few weeks ago, the UK really had to do the same You are right they had to rise interest rates ,and with the tax cuts ,and abandoning the NI increases ,he is banking on the countries' growth of 2.5% ,to pay for everything. Listening to Today on R4 this afternoon ,they had an article saying they could well be a word resection with all the interest rates going up, likely, then the next article on the program was a government spokesman ,saying we will have our 2.5% rise in the economy, unlikely. The last chancellor that tried a budget like this was Tony Barber back in 1972,then the rest is history ,high interest rates,3-day working week ,strikes all the time, up to a few years ago I still had the petrol coupons that were issued at the time ,but never used. 2 1 1 Link to comment Share on other sites More sharing options...
Popular Post placeholder Posted September 24, 2022 Popular Post Share Posted September 24, 2022 1 hour ago, hotandsticky said: Not my own work, but amusing nonetheless. All I am hearing from the opposition benches and labour supporters is that the tax cuts give more back to the higher earners than the lower works. Do they really not understand how tax and tax cuts work. This puts it in terms even Angela Raynor and Keir Starmer can understand.With credit to Julie Carritt Was Smith.It's simple economics... a copy has been sent to Keir!Suppose that once a week, ten men go out for beer and the bill for all ten comes to £100. If they paid their bill the way we pay our taxes, it would go something like this...The first four men (the poorest) would pay nothing.The fifth would pay £1.The sixth would pay £3.The seventh would pay £7.The eighth would pay £12.The ninth would pay £18.And the tenth man (the richest) would pay £59.So, that's what they decided to do.The ten men drank in the bar every week and seemed quite happy with the arrangement until, one day, the owner caused them a little problem. "Since you are all such good customers," he said, "I'm going to reduce the cost of your weekly beer by £20." Drinks for the ten men would now cost just £80.The group still wanted to pay their bill the way we pay our taxes. So the first four men were unaffected. They would still drink for free but what about the other six men? The paying customers? How could they divide the £20 windfall so that everyone would get his fair share?They realized that £20 divided by six is £3.33 but if they subtracted that from everybody's share then not only would the first four men still be drinking for free but the fifth and sixth man would each end up being paid to drink his beer.So, the bar owner suggested that it would be fairer to reduce each man's bill by a higher percentage.They decided to follow the principle of the tax system they had been using and he proceeded to work out the amounts he suggested that each should now pay.And so, the fifth man, like the first four, now paid nothing (a100% saving).The sixth man now paid £2 instead of £3 (a 33% saving).The seventh man now paid £5 instead of £7 (a 28% saving).The eighth man now paid £9 instead of £12 (a 25% saving).The ninth man now paid £14 instead of £18 (a 22% saving).And the tenth man now paid £49 instead of £59 (a 16% saving).Each of the last six was better off than before with the first four continuing to drink for free.But, once outside the bar, the men began to compare their savings. "I only got £1 out of the £20 saving," declared the sixth man. He pointed to the tenth man, "but he got £10!""Yeah, that's right," exclaimed the fifth man. "I only saved a £1 too. It's unfair that he got ten times more benefit than me!""That's true!" shouted the seventh man. "Why should he get £10 back, when I only got £2? The wealthy get all the breaks!""Wait a minute," yelled the first four men in unison, "we didn't get anything at all. This new tax system exploits the poor!" The nine men surrounded the tenth and beat him up.The next week the tenth man didn't show up for drinks, so the nine sat down and had their beers without him. But when it came time to pay the bill, they discovered something important - they didn't have enough money between all of them to pay for even half of the bill!And that, boys and girls, journalists and government ministers, is how our tax system works. The people who already pay the highest taxes will naturally get the most benefit from a tax reduction. Tax them too much, attack them for being wealthy and they just might not show up any more. In fact, they might start drinking overseas, where the atmosphere is somewhat friendlier.For those who understand, no explanation is needed.For those who do not understand, no explanation is possible. What you don't seem to understand is that this example is exactly opposite to the current case. Instead of giving a lesser percentage break to the wealthiest party, the Tories have given the biggest percentage break to the wealthiest. The lowest earning actually get a lesser percentage reduction than do the wealthiest. 3 2 Link to comment Share on other sites More sharing options...
Popular Post RayC Posted September 24, 2022 Popular Post Share Posted September 24, 2022 On 9/23/2022 at 5:30 PM, Mac Mickmanus said: I think that the Conservatives know they are going to lose the next election , and they are getting the economy ready for the handover of power to Labour , and let them deal with it I don't understand what you mean? Are you suggesting that the Tories are deliberately trying to make matters worse? 2 1 Link to comment Share on other sites More sharing options...
Popular Post RayC Posted September 24, 2022 Popular Post Share Posted September 24, 2022 4 hours ago, hotandsticky said: Not my own work, but amusing nonetheless. All I am hearing from the opposition benches and labour supporters is that the tax cuts give more back to the higher earners than the lower works. Do they really not understand how tax and tax cuts work. This puts it in terms even Angela Raynor and Keir Starmer can understand.With credit to Julie Carritt Was Smith.It's simple economics... a copy has been sent to Keir!Suppose that once a week, ten men go out for beer and the bill for all ten comes to £100. If they paid their bill the way we pay our taxes, it would go something like this...The first four men (the poorest) would pay nothing.The fifth would pay £1.The sixth would pay £3.The seventh would pay £7.The eighth would pay £12.The ninth would pay £18.And the tenth man (the richest) would pay £59.So, that's what they decided to do.The ten men drank in the bar every week and seemed quite happy with the arrangement until, one day, the owner caused them a little problem. "Since you are all such good customers," he said, "I'm going to reduce the cost of your weekly beer by £20." Drinks for the ten men would now cost just £80.The group still wanted to pay their bill the way we pay our taxes. So the first four men were unaffected. They would still drink for free but what about the other six men? The paying customers? How could they divide the £20 windfall so that everyone would get his fair share?They realized that £20 divided by six is £3.33 but if they subtracted that from everybody's share then not only would the first four men still be drinking for free but the fifth and sixth man would each end up being paid to drink his beer.So, the bar owner suggested that it would be fairer to reduce each man's bill by a higher percentage.They decided to follow the principle of the tax system they had been using and he proceeded to work out the amounts he suggested that each should now pay.And so, the fifth man, like the first four, now paid nothing (a100% saving).The sixth man now paid £2 instead of £3 (a 33% saving).The seventh man now paid £5 instead of £7 (a 28% saving).The eighth man now paid £9 instead of £12 (a 25% saving).The ninth man now paid £14 instead of £18 (a 22% saving).And the tenth man now paid £49 instead of £59 (a 16% saving).Each of the last six was better off than before with the first four continuing to drink for free.But, once outside the bar, the men began to compare their savings. "I only got £1 out of the £20 saving," declared the sixth man. He pointed to the tenth man, "but he got £10!""Yeah, that's right," exclaimed the fifth man. "I only saved a £1 too. It's unfair that he got ten times more benefit than me!""That's true!" shouted the seventh man. "Why should he get £10 back, when I only got £2? The wealthy get all the breaks!""Wait a minute," yelled the first four men in unison, "we didn't get anything at all. This new tax system exploits the poor!" The nine men surrounded the tenth and beat him up.The next week the tenth man didn't show up for drinks, so the nine sat down and had their beers without him. But when it came time to pay the bill, they discovered something important - they didn't have enough money between all of them to pay for even half of the bill!And that, boys and girls, journalists and government ministers, is how our tax system works. The people who already pay the highest taxes will naturally get the most benefit from a tax reduction. Tax them too much, attack them for being wealthy and they just might not show up any more. In fact, they might start drinking overseas, where the atmosphere is somewhat friendlier.For those who understand, no explanation is needed.For those who do not understand, no explanation is possible. And whoever thought up this analogy, and thinks that this is how an economy functions, clearly has no knowledge of economics. 6 1 Link to comment Share on other sites More sharing options...
Mac Mickmanus Posted September 24, 2022 Share Posted September 24, 2022 Its quite possible/ probably, that there will be a further rise quite soon . Could even be by a full 1 % Link to comment Share on other sites More sharing options...
Popular Post Chomper Higgot Posted September 25, 2022 Popular Post Share Posted September 25, 2022 (edited) 4 hours ago, Mac Mickmanus said: Its quite possible/ probably, that there will be a further rise quite soon . Could even be by a full 1 % The interest rates are set to control inflation. The Chancellor of the Exchequer has just released tens of billions of pounds back into the economy which will increase inflation, so yes, you’re probably right, interest rates will rise again. I also expect the tug of war between the Government and the BoE to end badly. Look out for the rightwing press softening up the public with attacks on the BoE and its Governor. Truss has promised growth of 2.5 %, in the face of a recession, low productivity and rocketing national debt. The economics are against her, so she’s going to abandon economics and go with recklessness instead. She needs to take control of the BoE in order to give full vent to her idiocy. All the while millions in Britain can’t afford to eat regular meals. Edited September 25, 2022 by Chomper Higgot 3 1 Link to comment Share on other sites More sharing options...
metisdead Posted September 25, 2022 Share Posted September 25, 2022 Another post with content that was copy and pasted from some site without a link has been removed. Link to comment Share on other sites More sharing options...
JayClay Posted September 25, 2022 Share Posted September 25, 2022 8 hours ago, RayC said: I don't understand what you mean? Are you suggesting that the Tories are deliberately trying to make matters worse? Yes that's exactly what he means. 1 1 Link to comment Share on other sites More sharing options...
hotandsticky Posted September 25, 2022 Share Posted September 25, 2022 10 hours ago, RayC said: And whoever thought up this analogy, and thinks that this is how an economy functions, clearly has no knowledge of economics. That humour clearly went over your head - I guess I am not surprised by that. This won't suit your agenda either, but give it a go:- https://www.mirror.co.uk/news/uk-news/martin-lewis-gives-good-news-28069836?fbclid=IwAR30JscJTwrUz6XfWH0Ol7Abl4tt7lQhXGvBbwU4BJfZNw2SquSpKpabhEU Link to comment Share on other sites More sharing options...
Popular Post connda Posted September 25, 2022 Popular Post Share Posted September 25, 2022 Bank of England raises rates to 2.25%, despite likely recession That's the characteristic of stagflation: Rapidly rising inflation during an economic recession. Just allow bankers to give themselves obscene bonuses and all will be better (for them, the common folk don't matter). 4 1 Link to comment Share on other sites More sharing options...
RayC Posted September 25, 2022 Share Posted September 25, 2022 (edited) 2 hours ago, hotandsticky said: That humour clearly went over your head - I guess I am not surprised by that. .... or underneath my feet. We obviously have a different sense of humour if you found it amusing. 2 hours ago, hotandsticky said: This won't suit your agenda either, but give it a go:- https://www.mirror.co.uk/news/uk-news/martin-lewis-gives-good-news-28069836?fbclid=IwAR30JscJTwrUz6XfWH0Ol7Abl4tt7lQhXGvBbwU4BJfZNw2SquSpKpabhEU Why should I object to this article? It's just repeating the numbers. Have you done/read/ listened to a broader analysis of the measures before (apparently) making up your mind that they are for the best? If not, you are the one with the agenda, not me. As I wrote previously, Truss is being true to her word. If these initiatives work then great, the country will be in a better place. If not, we are probably b@#£ered for a decade or so. (Bolding unintended) Edited September 25, 2022 by RayC Addition 1 1 Link to comment Share on other sites More sharing options...
Popular Post JonnyF Posted September 26, 2022 Popular Post Share Posted September 26, 2022 It seems under Truss we finally have a true Conservative government. I wonder how the left are feelling now? Having hounded Boris out, they may be wishing they had left things well alone. Certainly a gamble by Truss. Let's wait and see how it works out before crucifying her. Drastic times call for drastic measures, and the cost of lockdown crisis is certainly upon us. Many of us warned about the economic carnage that would result from locking people in their homes for months, but unfortunately we were ignored. Well here comes the carnage, better strap in. 3 Link to comment Share on other sites More sharing options...
Popular Post Chomper Higgot Posted September 26, 2022 Popular Post Share Posted September 26, 2022 1 hour ago, JonnyF said: It seems under Truss we finally have a true Conservative government. I wonder how the left are feelling now? Having hounded Boris out, they may be wishing they had left things well alone. Certainly a gamble by Truss. Let's wait and see how it works out before crucifying her. Drastic times call for drastic measures, and the cost of lockdown crisis is certainly upon us. Many of us warned about the economic carnage that would result from locking people in their homes for months, but unfortunately we were ignored. Well here comes the carnage, better strap in. I think ‘The Left’ are almost certainly watching Truss tank the economy while handing tens of £billions to the already wealthy while thinking ‘this is her honeymoon period’. Or they might be observing he chief of staff being questioned by the FBI regarding election rigging. Or perhaps they are observing the fact Truss has actively sought to antagonize Tory MPs who didn’t support her. Regardless’The Left’ did not hound Johnson out, he was ousted by his own party. 4 Link to comment Share on other sites More sharing options...
JonnyF Posted September 26, 2022 Share Posted September 26, 2022 1 hour ago, Chomper Higgot said: I think ‘The Left’ are almost certainly watching Truss tank the economy while handing tens of £billions to the already wealthy while thinking ‘this is her honeymoon period’. I seem to recall you were supporting Truss for PM. I distinctly remember the TrussforPM hashtag on many of your posts during the leadership contest. So you got what you wanted. A true conservative as PM. ???? Let's see if this mini budget has the desired effect. Link to comment Share on other sites More sharing options...
Chomper Higgot Posted September 26, 2022 Share Posted September 26, 2022 26 minutes ago, JonnyF said: I seem to recall you were supporting Truss for PM. I distinctly remember the TrussforPM hashtag on many of your posts during the leadership contest. So you got what you wanted. A true conservative as PM. ???? Let's see if this mini budget has the desired effect. Let’s see if you can find a post in which I support Truss for PM. 1 Link to comment Share on other sites More sharing options...
JonnyF Posted September 26, 2022 Share Posted September 26, 2022 57 minutes ago, Chomper Higgot said: Let’s see if you can find a post in which I support Truss for PM. You're welcome. 1 Link to comment Share on other sites More sharing options...
Popular Post Chomper Higgot Posted September 26, 2022 Popular Post Share Posted September 26, 2022 (edited) 48 minutes ago, JonnyF said: You're welcome. I was right, she was the opposition’s preferred candidate. And she’s making exactly the mess I and many others predicted. But congratulations, you did manage to find Truss’ foremost supporter, who I was responding to. Oddly, since getting what he wanted he’s gone very quiet. Edited September 26, 2022 by Chomper Higgot 3 1 Link to comment Share on other sites More sharing options...
nigelforbes Posted September 26, 2022 Share Posted September 26, 2022 On 9/24/2022 at 5:16 PM, Mavideol said: come on, give it a shot, you may be surprised 555 That was actually the joke, 99% of people don't benefit from trickle down economics, or so the popular theory goes. 1 Link to comment Share on other sites More sharing options...
nigelforbes Posted September 26, 2022 Share Posted September 26, 2022 On 9/25/2022 at 7:43 AM, Chomper Higgot said: The interest rates are set to control inflation. The Chancellor of the Exchequer has just released tens of billions of pounds back into the economy which will increase inflation, so yes, you’re probably right, interest rates will rise again. I also expect the tug of war between the Government and the BoE to end badly. Look out for the rightwing press softening up the public with attacks on the BoE and its Governor. Truss has promised growth of 2.5 %, in the face of a recession, low productivity and rocketing national debt. The economics are against her, so she’s going to abandon economics and go with recklessness instead. She needs to take control of the BoE in order to give full vent to her idiocy. All the while millions in Britain can’t afford to eat regular meals. My view is that the higher the BOE rates go, the more attractive that makes Sterling and the less it costs us to service foreign debt. Increased rates also attract foreign investment which combined with other tax cuts, should make the UK more competitive and attractive to foreign business. Oh yes, increased rates also help control inflation. The downside is that domestic rates will increase also hence consumer and business borrowing become more expensive. In theory that is partially offset by increased interest on savings, assuming everyone has any! I can see the logic and think it's a bold move and a sound one, the alternative after all is....what? Link to comment Share on other sites More sharing options...
Chomper Higgot Posted September 26, 2022 Share Posted September 26, 2022 (edited) 49 minutes ago, nigelforbes said: My view is that the higher the BOE rates go, the more attractive that makes Sterling and the less it costs us to service foreign debt. Increased rates also attract foreign investment which combined with other tax cuts, should make the UK more competitive and attractive to foreign business. Oh yes, increased rates also help control inflation. The downside is that domestic rates will increase also hence consumer and business borrowing become more expensive. In theory that is partially offset by increased interest on savings, assuming everyone has any! I can see the logic and think it's a bold move and a sound one, the alternative after all is....what? You assume Truss has any say in BoE interest rates, she does not. Moreover she has signaled she may remove BoE independence. Right now the BoE is increasing interest rates to quell inflation and the Exchequer is borrowing money to reduce taxes, thereby increasing available cash in the economy. This clearly is not a coordinated plan. Running across a busy road with your eyes shut could also be referred to as ‘a bold move’, or ‘crass stupidity’. Edited September 26, 2022 by Chomper Higgot 2 Link to comment Share on other sites More sharing options...
placeholder Posted September 26, 2022 Share Posted September 26, 2022 56 minutes ago, nigelforbes said: My view is that the higher the BOE rates go, the more attractive that makes Sterling and the less it costs us to service foreign debt. Increased rates also attract foreign investment which combined with other tax cuts, should make the UK more competitive and attractive to foreign business. Oh yes, increased rates also help control inflation. The downside is that domestic rates will increase also hence consumer and business borrowing become more expensive. In theory that is partially offset by increased interest on savings, assuming everyone has any! I can see the logic and think it's a bold move and a sound one, the alternative after all is....what? Higher interest rates may make sterling more attractive but why would it make investing in the UK private sector more attractive? 1 Link to comment Share on other sites More sharing options...
nigelforbes Posted September 26, 2022 Share Posted September 26, 2022 11 minutes ago, placeholder said: Higher interest rates may make sterling more attractive but why would it make investing in the UK private sector more attractive? Once you invest in Sterling you have to do something with it after you've bought it! We're in a risk off mode presently so equities and bonds don't make much sense, private sector investment is one alternative. Link to comment Share on other sites More sharing options...
nigelforbes Posted September 26, 2022 Share Posted September 26, 2022 26 minutes ago, Chomper Higgot said: You assume Truss has any say in BoE interest rates, she does not. Moreover she has signaled she may remove BoE independence. Right now the BoE is increasing interest rates to quell inflation and the Exchequer is borrowing money to reduce taxes, thereby increasing available cash in the economy. This clearly is not a coordinated plan. Running across a busy road with your eyes shut could also be referred to as ‘a bold move’, or ‘crass stupidity’. Large scale inflation during a recession is a serious problem, there is no single answer that suits both sides of the economic argument, at the same time. Lowering inflation has to be the priority hence that means increased interest rates, that's BOE's job. Stimulating growth is the governments job, hence the tax cuts, which in turn means increased government borrowings. Which of those two items would you suggest we forgo, quelling inflation or stimulating growth? I think that trying to do both things at once is a bold move, I hope it doesn't backfire but as I said earlier, what is the alternative? Link to comment Share on other sites More sharing options...
placeholder Posted September 26, 2022 Share Posted September 26, 2022 (edited) 19 minutes ago, nigelforbes said: Once you invest in Sterling you have to do something with it after you've bought it! We're in a risk off mode presently so equities and bonds don't make much sense, private sector investment is one alternative. If someone is buying sterling as an investment that means they're're buying gilts (treasury bonds) and hoping that it appreciates in value while it also yields interest. It has nothing to do with investing in a business. Edited September 26, 2022 by placeholder Link to comment Share on other sites More sharing options...
placeholder Posted September 26, 2022 Share Posted September 26, 2022 6 minutes ago, nigelforbes said: Large scale inflation during a recession is a serious problem, there is no single answer that suits both sides of the economic argument, at the same time. Lowering inflation has to be the priority hence that means increased interest rates, that's BOE's job. Stimulating growth is the governments job, hence the tax cuts, which in turn means increased government borrowings. Which of those two items would you suggest we forgo, quelling inflation or stimulating growth? I think that trying to do both things at once is a bold move, I hope it doesn't backfire but as I said earlier, what is the alternative? The problem is that tax cuts, are a very ineffective way to stimulate growth. That path has been touted again and again. It only works if tax rates are so prohibitively high like 75 or 80 percent. It makes more sense to give cuts to lower income people since they are far more likely to spend it and stimulate the economy. Of course that will push up inflation but the benefits for those with lower income should outweigh the inflationary effects. 2 Link to comment Share on other sites More sharing options...
nigelforbes Posted September 26, 2022 Share Posted September 26, 2022 1 minute ago, placeholder said: If someone is buying sterling as an investment that means they're're buying gilts (treasury bonds) and hoping to that it appreciates in value while it also yields interest. It has nothing to do with investing in a business. It doesn't have to be gilts, why must it be so? Overseas investors are able to invest the same things that UK citizens are, hedge funds, property, markets, private sector business, venture capital etc etc. I'm an overseas investor who invests globally, including in the UK. I am invested in UK property, UK income and accumulation funds and also in a UK business, anyone practically can do exactly the same. Link to comment Share on other sites More sharing options...
nigelforbes Posted September 26, 2022 Share Posted September 26, 2022 2 minutes ago, placeholder said: The problem is that tax cuts, are a very ineffective way to stimulate growth. That path has been touted again and again. It only works if tax rates are so prohibitively high like 75 or 80 percent. It makes more sense to give cuts to lower income people since they are far more likely to spend it and stimulate the economy. Of course that will push up inflation but the benefits for those with lower income should outweigh the inflationary effects. OK, if that's what you think. I disagree, I think trickle down economics works and that giving hand outs to the lowest income group is nothing more than financial aid and nothing to do with stimulating the economy. Trickle up economics, which is what that is, doesn't create jobs or stimulate new investment, ....I think. Link to comment Share on other sites More sharing options...
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