love detective
there's no love too small
that you can't even make a post on the topic being discussed does not point to my idiocy i'm afraid
Global financial system implosion begins
- Thread starter Falcon
- Start date
"Rabbiting on"? "crap"? "ideology"? "right wing"? etc.
Unable, no. Unwilling, yes. You disqualify yourself from civil debate with your persistent Tourette Syndrome mode of expression, and are impossibly compromised by your political overlay of what is basic, time discounted actuarial data. You really leave people without any civil basis to engage with you, and any lack of response to your utterances should not surprise you.
love detective
there's no love too small
What you posted in the quote from EPC clearly referred to the 2.2 trillion as a liability, I.e. one side of the equation which is required to work out what any deficit is
That you continually refer to this liability as a deficit shows that you don't even understand the quotes you are using to try and back up your 'point'
Simply put, you don't understand the basics of what you are trying to discuss
That you continually refer to this liability as a deficit shows that you don't even understand the quotes you are using to try and back up your 'point'
Simply put, you don't understand the basics of what you are trying to discuss
1. Funding deficit is highly sensitive to estimates of growth rate (trillions/%)
2. Official figures habitually overestimated the growth rate in estimating pension funding even before the 2008 crash
3. The funding deficit is underestimated by trillions
I make no other point, and need defend no other point. Specifically, I have no need to engage in your misdirection attempt. There is simply no misdirection you could possibly mount that alters this basic structural fact of our pension system, with these population demographics, over these timescales.
Any political discomfort that point causes you disinterests me.
love detective
there's no love too small
You don't understand the difference between a deficit and a liability
You don't understand that any changes in discount rates that are applied to future income/expenditure streams impact both sides of the equation, your persistent focus on the liability side only is misleading, ignorant and plain wrong
The whole point of discounting future cash flows to present value to get a Net Present Value is that you include cash flows in as well as out, anything less gives a meaningless figure, I.e. your 2.2/4 trillion
You don't understand that you can't look at a liability and call it a deficit
What you are saying is equivalent to saying that if you counted up the future payments you expect to make on a 25 year residential mortgage and discount them to present value, and then compare this liability to how much cash you have in the bank at this moment in time, then this figure represents a deficit, which is utter nonsense - what it actually represents is a meaningless number which in itself tells us nothing about the affordability or sustainability of that situation.
You don't understand that any changes in discount rates that are applied to future income/expenditure streams impact both sides of the equation, your persistent focus on the liability side only is misleading, ignorant and plain wrong
The whole point of discounting future cash flows to present value to get a Net Present Value is that you include cash flows in as well as out, anything less gives a meaningless figure, I.e. your 2.2/4 trillion
You don't understand that you can't look at a liability and call it a deficit
What you are saying is equivalent to saying that if you counted up the future payments you expect to make on a 25 year residential mortgage and discount them to present value, and then compare this liability to how much cash you have in the bank at this moment in time, then this figure represents a deficit, which is utter nonsense - what it actually represents is a meaningless number which in itself tells us nothing about the affordability or sustainability of that situation.
Here's a fun analogy for this situation using beer instead of oil energy and beer-tokens instead of money.
While barley harvests are good and hops are plentiful, pubs can issue beer tokens as they see fit. People use beer tokens to trade for other things, tobacco, food, cars, houses, etc. Employers even pay employees in beer tokens. Everybody uses beer tokens!
The pubs have all kinds of special promotions. One such is the "pie 'n' pint pension", where if you collect say, 10000 beer tokens, you qualify for a pie and a pint every day for life.
This scheme works well, as does the use of beer tokens for trading other goods. There are many more beer tokens in circulation than there is beer for sale, but nobody worries about this because not everybody goes to the pub at the same time and many folks are saving tokens for their pie 'n' pint pension.
All goes well until rising sea levels start to flood barley-growing areas and changing climate withers the hop crop. Beer becomes more scarce and expensive.
At first the pubs dismiss concerns of worried drinkers, saying this is just a temporary blip and beer will be bountiful once the farmers sort out their "production problem".
Unfortunately, as climate change continues, the problems get worse. Pubs continue to print beer tokens and create ever-more exotic offers for those who save up enough tokens. When the public starts to worry about beer shortages, they say they farmers will adapt to change by growing rice on the flooded land and that brewers will produce Saké instead of beer: everything will be fine. No need to panic!
Only later is it realised that rice won't grow in fields now flooded by salty, brackish water. It dawns on the public that the promised transition to a Saké-based economy with drinking-as-usual just ain't gonna happen.
By this time, beer is in very short supply and costs over 500 tokens a pint. People panic and rush to exchange the tokens they've been saving for their pie 'n' pint pensions: the pumps run dry. There are beer riots in every town.
With no beer (or Saké) available, life becomes pointless. Beer tokens are worthless. Civilisation collapses.
~
The integrity of the pie 'n' pint pension system and the beer token scheme in total, is dependent on the availability of beer.
This, in turn is dependent on a number of other factors, like the ability to grow (enough) barley and hops. Publicans call these factors "externalities" because they never really thought about them before, as they have nothing to do with selling beer, issuing beer tokens or creating pie-'n'-pint-for-life schemes.
While barley harvests are good and hops are plentiful, pubs can issue beer tokens as they see fit. People use beer tokens to trade for other things, tobacco, food, cars, houses, etc. Employers even pay employees in beer tokens. Everybody uses beer tokens!
The pubs have all kinds of special promotions. One such is the "pie 'n' pint pension", where if you collect say, 10000 beer tokens, you qualify for a pie and a pint every day for life.
This scheme works well, as does the use of beer tokens for trading other goods. There are many more beer tokens in circulation than there is beer for sale, but nobody worries about this because not everybody goes to the pub at the same time and many folks are saving tokens for their pie 'n' pint pension.
All goes well until rising sea levels start to flood barley-growing areas and changing climate withers the hop crop. Beer becomes more scarce and expensive.
At first the pubs dismiss concerns of worried drinkers, saying this is just a temporary blip and beer will be bountiful once the farmers sort out their "production problem".
Unfortunately, as climate change continues, the problems get worse. Pubs continue to print beer tokens and create ever-more exotic offers for those who save up enough tokens. When the public starts to worry about beer shortages, they say they farmers will adapt to change by growing rice on the flooded land and that brewers will produce Saké instead of beer: everything will be fine. No need to panic!
Only later is it realised that rice won't grow in fields now flooded by salty, brackish water. It dawns on the public that the promised transition to a Saké-based economy with drinking-as-usual just ain't gonna happen.
By this time, beer is in very short supply and costs over 500 tokens a pint. People panic and rush to exchange the tokens they've been saving for their pie 'n' pint pensions: the pumps run dry. There are beer riots in every town.
With no beer (or Saké) available, life becomes pointless. Beer tokens are worthless. Civilisation collapses.
~
The integrity of the pie 'n' pint pension system and the beer token scheme in total, is dependent on the availability of beer.
This, in turn is dependent on a number of other factors, like the ability to grow (enough) barley and hops. Publicans call these factors "externalities" because they never really thought about them before, as they have nothing to do with selling beer, issuing beer tokens or creating pie-'n'-pint-for-life schemes.
free spirit
more tea vicar?
as I said earlier, I was writing geography essays about this in middle school, then again at GCSE, A level and degree level, so I'm well aware of these sort of facts and figures, and they inform my viewpoint on this.
I quite carefully didn't say that. I said it would 'pretty much' sort 'the majority' of these problems out.
As in, it would sort out the shock horror figures out that you're supplying on this thread, and leave a situation that's more feasibly managed through gradual increases in the retirement age, increases in NI contributions and similar policies.
Under the circumstances where the government policy gets turned on its head, and some sort of Marshall plan of investment to stimulate the economy takes affect. Obviously this may not happen, our politicians may continue the current disasterous policies, but I'm reasonably sure that at some point sense will prevail once their ideas have been proven to be utterly wrong so clearly that even the politicians are forced to change tack (one way or another).
As stated many times, I don't agree with your analysis of the situation regarding peak oil etc. I see it as a major hinderence to any economic recovery, but certainly not as something that actually prevents a recovery being even remotely possible given the right set of policies being put in place. Particularly as I see the necessary methods for coping with this reduction in energy availability themselves being a massive economic stimulus, so the 2 things go hand in hand... ie we can't transition to a low carbon, low energy intensity economy without minimum hundreds of thousands of new jobs being created in the UK to make it happen, as energy efficiency and renewable energy measures are of a very distributed nature mainly, and require input in terms of people hours working in homes and workplaces across the country to put them in place. Any economic benefit from these measures therefore should be relatively well distributed across the country, and capable of supplying employment in employment black spots etc rather than just in the city of London, or other places that don't really need the economic stimulus.
tbf though, I'm of the opinion that the recession caused by the markets crash in 2007-8 has now been turned into a depression* directly by current tory / coalition policies, but other countries have got their GDP back to 2007 levels, so there's no logical reason that we couldn't also do this with the correct policies, and leadership.
your logic here is fine, I've no problem with it. If this were the case, then yes we'd be well and truly fucked as I said earlier, but it's only that way if we make it that way... we also have the choice of putting in place policies to get us out of this depression, and stimulate the economic growth necessary to at least reduce the scale of the problems to more manageable levels. I prefer to concentrate on the latter instead of the former, as no good can come from focusing on the worst case scenario while talking down any possibility of avoiding it.
*or at least will be referred to in future as a depression period.
free spirit
more tea vicar?
the problem with simplistic analogies is that they're simplistic whereas the real situation is highly complex, essentially chaotic with a massive number of different variables coming together to create the whole of a nations and / or the global economy.
As a fun analogy, It's a little like the few climatologists in the 60's who wrongly assumed the world was facing a global cooling period because they expected the solar irradiation levels to reduce. They jumped to conclusions based on partial data about one single element that impacted on a highly complex chaotic system, and were rapidly proved wrong once the other variables were analysed in detail and it became clear that we were actually facing a significant long term warming trend caused by one factor they'd ignored that had been temporarily masked by another factor they'd not considered.
ska invita
back on the other side
China boosts economy with £99bn infrastructure plan
any thoughts on the effect of this?
any thoughts on the effect of this?
deke t lefel
Active Member
the river of dollars flowing into China will be resisted by the tide going out?
Fed Undertakes QE3 With $40 Billion Monthly MBS Purchases
Bloomberg 2012-09-13
Britain's richest 5% gained most from quantitative easing – Bank of England
guardian.co.uk, Thursday 23 August 2012
Bloomberg 2012-09-13
"$40 billion of mortgage debt a month" but for how long?
Britain's richest 5% gained most from quantitative easing – Bank of England
guardian.co.uk, Thursday 23 August 2012
Taking from the poor and giving to the rich.
love detective
there's no love too small
saw an article in the FT today that reminded me of Falcon's approach to pension liabilities further up on this thread
free spirit
more tea vicar?
thing is, falcons position on pensions does make a warped kind of sense as a logical progression from his position of the economy being terminally fucked by the rapid decline in global energy supply he predicts, along with climate change impacts.
I think essentially when he talking about 50 years of unfunded liaiblities etc he genuinely believes that we simply won't be able to fund those liabilities from our future severely shrunken economy.
I'm not saying I agree with his position, just pointing out that there at least is some logic to it even if I believe the logic is based on a several fallacies and therefore the position is wrong.
I think essentially when he talking about 50 years of unfunded liaiblities etc he genuinely believes that we simply won't be able to fund those liabilities from our future severely shrunken economy.
I'm not saying I agree with his position, just pointing out that there at least is some logic to it even if I believe the logic is based on a several fallacies and therefore the position is wrong.
toblerone3
Grrrrr
Been some good economic figures recently. Inflation down, unemployment down, probable coming out of double dip. Also the Eurozone countries strenthening their commitments to support each other's economies.
http://www.bbc.co.uk/news/world-europe-20005100
Are we over the worst now and the financial system is safe?
http://www.bbc.co.uk/news/world-europe-20005100
Are we over the worst now and the financial system is safe?
Just have a wee look at what's happening to the Chinese economy.. and be very, very, afraid.
toblerone3
Grrrrr
I've been following economic commentators on China since 1995 and people have predicting that its going to blow up for most of that period. So I'm a little sceptical about doomsayers about the Chinese economy.
You might be right. But I am sceptical. Max Keiser has been saying some interesting things about competitive devaluations between the dollar and the yuan and the prospects for American inflation recently. But I am beginning to doubt him as well.
toblerone3
Grrrrr
From that article.
"There is still a tangible probability - not a high probability - that the worst may still be ahead."
BigTom
Well-Known Member
Unemployment hasn't really fallen though, it's mostly self-employment (which may or may not be real, sustainable jobs) and people on government workfare or training schemes, and 69% of jobs created in the past year have been part time so the increasing employment won't have the same effect. Number of hours worked is down month on month still.
Inflation is slowing which is good but it's still above average wage increases and food and fuel are still rising far faster than inflation overall which is very bad for anyone on benefits / low pay.
Plus cuts in government spending increase next year and will keep increasing onto 2015, and the deficit is rising..
Personally I don't feel very hopeful, but it should also be recognised that in Birmingham and the West Midlands unemployment is continuing to rise so my experience is out of step with the rest of England (Scotland and I think Wales also still have rising unemployment)
free spirit
more tea vicar?
tom - have you got a link to the stats showing the number of hours worked?
BigTom
Well-Known Member
umm.. it was somewhere in all the articles following the recent unemployment figures, I'll see if I can find it, more likely to have been mentioned in an article though than the actual stats, but I assume ONS will have them if you can find it on their website.
BigTom
Well-Known Member
http://www.ons.gov.uk/ons/datasets-and-tables/data-selector.html?cdid=YBUS&dataset=lms&table-id=7
ok looks like they took a quarterly figure to get the fall though it may be the stat I saw was an average hours worked rather than a total, but:
That's total numbers of hours worker per week (millions). A quick glance shows the peak was 2008 FEB 949.3, for pre-recession reference. Or actually may be they included August/Sept.. anyway, late and I'm off out so can't see if there's a more recent data set.
free spirit
more tea vicar?
ta.
I think the "facts on the ground" about the Chinese economy speak a lot more loudly than :
a) the extraordinarily optimistic claims since 2008 by innumerable bourgeois economists that both China in particular and the "BRIC" "Developing" economies generally can or have in some magical way "decoupled" themselves from the unending current post 2008 death spiral of Western capitalism, and can lead the world back to prosperity
OR
b) the claim that the Chinese (neoliberal stalinists !!!) have in some way managed to overcome the almost entirely "workshop of the world" export orientation of their economy, such as to in a few years create a vast new internal market to keep both their domestic growth rates on track - AND provide a booming new market for OUR goods !
These are all fantasy ideas -- boosted by the extremely dubious statistics the Chinese government has always produced. But the existence of all those empty new speculative development "ghost" cities , and the millions of other empty commercial premises, all over China - built as a particularly crazy part of the Chinese economic stimulus bubble following 2008, provide the true picture of the profound crisis in the Chinese economy.
There is no "Chinese white knight" coming over the horizon to soak up the surplus production being churned out by Europe .. due to the ever falling demand of the European domestic market, as "austerity" measures push us ever faster into a 1930's style economic death dive.
Make no mistake, the world economy has lurched from unrestricted neo liberalist speculative boom into a crazed neoliberalist Long Depression - still powereed by the crazed ideology of Hayek economics which believes that the "invisible hand" of market economics will "sort it all out".. eventually. Nope, what lies ahead is a whole series of authoritarian military/fascist regimes and revolutionery resistance - not some painless return to stability and prosperity. The next indicator of this growing death spiral will include the collapse of vulnerable segments of the world car market .. Renault is the current weak link about to implode . And of course massive social unrest in China.. in fact its already started, with periodic mass riots across China by impoverished (second class citizen) migrant workers from the countryside happening throughout 2011/12.
love detective
there's no love too small
fancy that:-
ayatollah to me on another thread on 23st July 2012 said:
ayatollah on this thread said:
toblerone3
Grrrrr
You've completely moved the goalposts. You introduced the Chinese economy as a factor in the global economy that was set to implode and pull down the rest of the world economy with it. I expressed scepticism at that view. You then seemed to assume that I was arguing the opposite extreme, ie that the Chinese economy would ride in as the "Chinese white knight" to act as an engine of the world economy. I didn't say or imply that at all.
The Chinese economy is less export oriented than it used to be. Lots of infrastructure going in, lots of domestic market demand. While not enough to soak up all the world's suplus goods production there is a very good chance that it is enough to avoid a catastrophic economic collapse.
Collapsing real estate bubbles are nothing new in Chinese there have been ghost cities and the collapse of property speculation trends every few years for the past quarter of a century. The macro-economic managers in China have been getting more and more skilled at deflating bubbles in such a way to avoid social unrest. This was one of the lessons they learnt from Tiananmen.
Again nothing new and the Chinese state are experts at dealing with it.
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