UK economy shrank by 0.3% in April

[Funhouse]

Reeves cannot raise income tax, VAT or NI, but these are the following things currently under consideration (KPMG currently doing the IA).

-Dividend tax rates to reflect income tax rates.
-Council tax 25% single person discount removed for those living in Band D properties or above.
-Removal of £500 dividend allowance.
-25% pension tax free 55/57 capped at £100k.
-Cash ISAs capped at £4k per year to encourage S&S ISA investment

[DoctorStrangelove]

Your wish is Donny's command.

Spookily, we're only 4 years away from the 100-year anniversary of one.

If someone comes out with the immortal phrase or saying "It's different this time" then run for the hills after stocking up on baked beans.

[Protagoras]

What we need is a good old fashioned crash/recession/crisis. Over-debted businesses and banks liquidated. A painful reckoning followed by a fresh start.

The problem is that the political will to apply a capitalist response to capitalist issues doesn't exist. Rather than allow over-indebted businesses and banks to fail, the government seems to favour temporary nationalisation. Hence these businesses don't properly manage risk because they know they'll get bailed out.

It's time to start letting businesses fail. For essential services, acquire the remains from the administrators at rock bottom prices, but bondholders and shareholders should not be protected from losses.

[willendure]

The problem is that the political will to apply a capitalist response to capitalist issues doesn't exist. Rather than allow over-indebted businesses and banks to fail, the government seems to favour temporary nationalisation. Hence these businesses don't properly manage risk because they know they'll get bailed out.

It's time to start letting businesses fail. For essential services, acquire the remains from the administrators at rock bottom prices, but bondholders and shareholders should not be protected from losses.

Its true, but you have to be in the too big to fail category to get a bail out.

Its possible next crash will be something like the great depression. Because govt debt is too high, and interest on the debt is funded out of tax receipts which are a poportion of GDP. A crash will balloon out the debt at the same time as eroding GDP for the long run. Interest on long bonds will go up a lot.

We need a return to hard money, gold backed or bitcoin. Seriously the next decade is going to be ugly.

[jamesbrown]

bitcoin

[Protagoras]

Its possible next crash will be something like the great depression. Because govt debt is too high, and interest on the debt is funded out of tax receipts which are a poportion of GDP. A crash will balloon out the debt at the same time as eroding GDP for the long run. Interest on long bonds will go up a lot.

We need a return to hard money, gold backed or bitcoin. Seriously the next decade is going to be ugly.

Hard money comes with the problem of constrained supply. This doesn't suit government and banks. It also reduces inflation tax.

The FIAT monetary system only works because of confidence. As the decline of the UK continues unabated, I agree, this will only get worse. And it's not only the UK.

[woody1]

Not a bitcoin believer then?

It's hard to argue with the past performance though.

Although, starting at the current ~$100k ($2tn market cap), it might be a tad more difficult to replicate the 1000% gains of the past.

[DoctorStrangelove]

And take the $ off the gold standard.

[willendure]

Just wait until things get so bad that the UK has to introduce capital controls. Then we'll see who is laughing.

[willendure]

Hard money comes with the problem of constrained supply. This doesn't suit government and banks. It also reduces inflation tax.

The FIAT monetary system only works because of confidence. As the decline of the UK continues unabated, I agree, this will only get worse. And it's not only the UK.

Constrained supply is certainly something of an issue. In that regard gold could be seen as the best solution because its supply has increased at roughly 2% per year, which is in line with the growth of the worlds population. Also if gold becomes more valuable, more is mined, less valuable and mining becomes less attractive.

Currently BTC supply growth is lower than gold, making it the hardest significant financial asset in all of financial history. Its growth rate is pre-determined and will not increase under demand unlike gold.

I would argue that the fiat money system only works for short periods of time. There are no periods in history where a fiat currency has survived more than 100 years. Dollar and pound been around for longer but not more than 100 years without being pegged to gold.

BRICs have recently created a new gold backed currency. USA has massive amounts of gold and could attempt something similar - talk of 50 year gold backed bonds for example. Gordon Brown sold most of the UKs gold - how much has the BofE bought back since, or is the UK completely and utterly f**ked.