£1,300,000,000,000 in debt

[AtW]

They want to sell you insurance because it is high profit margin where as normal banking products might not have it.

Of course this high margin comes from the fact that you won't get insurance paid - a lot of naive people think that they buy insurance when they insure their car, house, job etc. Bless them - they don't realise that they are not buying insurance, they are buying a chance to claim it: the other side has got well paid professionals who are paid to ensure you don't get paid.

[AtW]

The only reason Swiss banking has succeeded over the years is their strict privacy laws and political stability.

They certainly lost the edge, but I think this is not because lack of privacy now as it is still present so long as you are not obvious criminal, but the fact that other locations became much less picky themselves and shady people who earned their wealth in industry ripe with assasinations now make IPOs on London Stock Exchange.

As for nuclear bunkers I believe their laws still stand and everyone (last time I read they had 20% excess capacity) has a place in it, I also like their idea of keeping rifles in the house.

I sure agree that Germany and France struggle with high costs, and yes VW wants to move manufacturing somewhere. But still they design cars there and make lots of them - they might struggle but they don't sell out it en masse like it happened in the UK. Looking at Rover debacle those 4 guys who bought it for a tenner and then asset striped it did not even go to jail, frankly, this is very much like what it happened in Russia.

I don't care if the City people make a lot of money - for me this is not an issue. The issue is that when financial bullsh1tting becomes the most profitable business other business stagnate. Here is what Psion's founder said:

"Britain can't depend on the City of London alone for its future prosperity, veteran entrepreneur Sir David Potter warned this week."

More: http://www.theregister.co.uk/2007/06...otter_preview/

He is 100% correct - the City can be deemed a cherry on top of big cake, but it seems to me that the cake has been eaten and the cherry will be popped sooner or later.

[Euro-commuter]

Does anyone think London and the immediate south east can buck the trend and hold up or increase modestly while the westcountry drops 20% in the next 5 years? This is my dream scenario.

For West Country read Scottish Highlands, and I'd like that. Unfortunately I see the reverse, i..e my newly-bought house in the SE goes down while the Highlands take off, and I can never retire.

[Rantor]

For West Country read Scottish Highlands, and I'd like that. Unfortunately I see the reverse, i..e my newly-bought house in the SE goes down while the Highlands take off, and I can never retire.

Sorry, but your post is a perfect example of unbridled caledonian pessimism - cheered me up enormously as I was thinking something similar yesterday.

[wendigo100]

Well, there is a slow down coming for sure. I don't think it is going to be a crash as such. There will be a correction...

Famous last words.

We've never had a "correction" from prices as high above historical trends as this.

Corrections from previous high bases (1974, 1989) resulted in crashes, but even they weren't as high as they are now.

[Sockpuppet]

We can't rely on the city.

As my economics tutor at uni told me: "There is a difference between making money and earning it".

[AtW]

Exactly sock - good banking system, capital markets is all great stuff, but only if they support real sector of the economy: in the USA they have both, in rest of Europe they maybe have real sector, but in the UK it seems like financial bullcrap is the main thing to live for and to die for - PhDs in exact sciences like mathematics seem to be only needed for bozos who will calculate models in the city - this is truly sad state of affairs for the country that was birthplace of industrial revolution.

[NoddY]

Exactly sock - good banking system, capital markets is all great stuff, but only if they support real sector of the economy: in the USA they have both, in rest of Europe they maybe have real sector, but in the UK it seems like financial bullcrap is the main thing to live for and to die for - PhDs in exact sciences like mathematics seem to be only needed for bozos who will calculate models in the city - this is truly sad state of affairs for the country that was birthplace of industrial revolution.

What makes one sector of the economy more real than another?

Like most things, it is an illusion. A rich man is only rich if we all agree he is. Some might argue the greater the level of abstraction the more sophisticated a society is.

[AtW]

Material assets have some intrinsic value in them based on their usefullness: a car can transport goods and people, a house can be used to live in it etc. Even in these cases asset values can be much higher than their actual value - houses is one such example.

The City is almost pure speculation that in my view has overall negative effect on other sectors. That's right - fkwit "analysts" pressure companies to abandon all long term interests and do whatever it takes to keep stock market happy in short term so that shares won't drop: that's why you see stupid decisions like outsourcing to India, closing down real manufacturing here etc. Financial sector in it's greed is destroying the very foundations on which it was build in the first place.

Maybe the solution is to have global minimum time limit on shareholding - say you can buy shares but you must keep them for at least X years before selling them. This would force companies to actually have long term planning and return money to shareholders via dividends like it was happening for centuries, rather than in form of inflated share price value achieved by short term cost cutting.

The downside is that guru types will lose their jobs, and Docklands will look as run down as it was in the past. But Shirely we can accept this price easily? I say send sadguru to pick strawberries for £5 an hour, this will teach him value of money and give him experience of an honest day of work.

[sasguru]

The downside is that guru types will lose their jobs, and Docklands will look as run down as it was in the past. But Shirely we can accept this price easily? I say send sadguru to pick strawberries for £5 an hour, this will teach him value of money and give him experience of an honest day of work.

You should get out of your bedsit a bit more and learn about the world. When the downturn comes, I will be making the decisions about who gets fired.