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Does the UK trade deficit matter to you?

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Does the UK trade deficit matter to you?

Post by Stox 16 on Sun Jan 29, 2012 2:49 am

This is a new economic topic and is looking at our deep long term financial problems based on our trade.

We was told by this Tory banal Government that this Government it had great aspirations for us too have an export lead recovery. Yet the UK now has a trade deficit equivalent to £2,566 million pounds . This follows a very lacklustre economic growth that fell by 0.2% in Q4. With are trade gap growing in size to £10 billion in September 2011. Is it possible to have a export lead recovery while having no economic fiscal growth policy at home? We have also see surveys showing falling overseas orders for the UK.

The UK is still the 5th biggest trading nation in the world. but we seem to have a government that is hell bent on cutting our role within the EU while we are facing a trade deficit that is getting bigger by the year. you could well say we are at the economic crossroads. as do we really care about out trade deficit or worry more about our banking and financial service sector. To me the UK was built on our world export with UK companies known the world over. I also believe we can and should do something about this now and not leave this to fade away.

If we are going to re-build our world trade how would you go about it?
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The UK has only 300 merchant ships left; is that wise for our economy?

Post by Stox 16 on Sun Jan 29, 2012 3:05 am

Just 300 Merchant ships left. is this wise for the UK economy?

it amazes me. as an Island Nation we (The British People) have let this happen. If you takeout the RFA and Foreland Shipping plus a few cruise liners (now nearly all American Owned!),offshore vessels, ferries and coasters what do you have left?

Many of the so called "British Ships" have no crew that are living in Britain aboard save the odd "cadet" and are just a small part of an international fleet ( like Maersk) where the British Flag could be switched overnight A STUFT Fleet with the exception of the Foreland vessels would be very hard to find and no longer do we have the large BP Tanker Fleet of the past. Crazy as an Island needing to import fuel that we do not at least a small fleet of British Owned, Crewed and Flagged Vessels. does this matter at all? or is it something of the past? today the shell oil tanker fleet is just three ships for the UK.

I doubt another Falklands type war but could the Government rely on the US owned Cunard or P&O Cruises to supply the equivalent of the QE2 and Canberra who were critical to our success then. The US were reluctant allies then, since they saw their interests more in South America with Argentina than with their 'Special Relationship' (a one way road if ever there was).

Here is just some of our fleet do in our waters. what would we do if we did not have them.? just pay some other country to help us out? I wonder

Kawasaki Dacos Hull 1671 Ore Carrier 2013 Uk
Kawasaki Dacos Hull 1670 Ore Carrier 2012 Uk
Stx Hull S-1461 Ore Carrier 2012 Uk
Stx Hull S-1449 Ore Carrier 2012 Uk
Stx Hull S-1353 Ore Carrier 2011 Uk
Stx Hull S-1308 Ore Carrier 2011 Uk
Cape Flamingo Bulkcarrier 2005 Uk
Cape Kestrel Bulkcarrier 1993 Uk
Cape Falcon Bulkcarrier 1993 Uk
Cape Eagle Bulkcarrier 1993 Uk
Cape Osprey Bulkcarrier 1995 Uk
Cape Hawk Bulkcarrier 1995 Uk
Cape Merlin Bulkcarrier 1994 Uk
Hyundai Samho Hull S433 2011 Uk
Hyundai Samho Hull S434 2011 Uk
Hyundai Samho Hull S435 2011 Uk
Hyundai Samho Hull S436 2011 Uk
Hyundai Samho Hull S437 2011 Uk

written by Stox in 2010
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Re: Does the UK trade deficit matter to you?

Post by oftenwrong on Sun Jan 29, 2012 3:37 pm

Merchant shipping has always been subject to the Maritime Regulations of the Country in which the ship is registered. Things like onboard safety requirements can be very expensive to provide.

Ships tend to be registered in a Country where such requirements are not especially onerous.



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Re: Does the UK trade deficit matter to you?

Post by bobby on Sun Jan 29, 2012 7:14 pm

If we are to have an export led recovery, it would be better for the UK, if we exported british made goods made in the UK by UK owned company's by honest owners who paid their taxes in the UK instead of the Caymans. Instead we are 5th in the world exporting stuff made by foregn company's.
Other than the income tax paid by the already low paid employee's and a bit of vat. The vast bulk of th proffits also gets exported to the Mother Countries of these foregn own company's
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Re: Does the UK trade deficit matter to you?

Post by Stox 16 on Sun Jan 29, 2012 10:12 pm

bobby wrote:If we are to have an export led recovery, it would be better for the UK, if we exported british made goods made in the UK by UK owned company's by honest owners who paid their taxes in the UK instead of the Caymans. Instead we are 5th in the world exporting stuff made by foregn company's.
Other than the income tax paid by the already low paid employee's and a bit of vat. The vast bulk of th proffits also gets exported to the Mother Countries of these foregn own company's

Well you have hit the nail right on the head bobby once more. here we are once more exporting both money to tax havens and jobs overseas. its this attitude by this government to economics of the UK that should shock most people. what other major world country has such a small fleet as we do? The last time i check the US had 450 ships with Japan have many more than us. so not only do we end up exporting UK company profits and even companies.. we also export the cost of moving our goods. what are we left with? employees Tax? with little else.
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Re: Does the UK trade deficit matter to you?

Post by Stox 16 on Sun Jan 29, 2012 10:20 pm

oftenwrong wrote:Merchant shipping has always been subject to the Maritime Regulations of the Country in which the ship is registered. Things like onboard safety requirements can be very expensive to provide.

Ships tend to be registered in a Country where such requirements are not especially onerous.




The thing is oftenwrong is our trade deficit is clearly reflected my are merchant fleet. ask yourself one question? what other major trading nation has such a small fleet as ours? as quite clearly the US or China do not share this view, nor does Japan. yet we believe this is quite alright? but are they right or are we right. as we cannot both be right can we?
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Re: Does the UK trade deficit matter to you?

Post by astradt1 on Sun Jan 29, 2012 10:25 pm

You don't need ships to move Finacial Services around the world........And it's the Finacial Sector that creates most of our over seas trade....mores the pity.....
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Re: Does the UK trade deficit matter to you?

Post by bobby on Sun Jan 29, 2012 10:51 pm

Hello astradt, you are quite right, and its because of our reliance on financial services that we are now being held to ransom by them, allowing the managers of these fanance houses to get the indescent oversised bonuses, threatening us that if they dont get them, they will phuk off abroad. If we had a high quality manufacturing base as we once had, we could now be telling those greedy bastards to phuck off any where thy please, cos we dont need you. But Thatcherite Britain made sure we had nothing to fall back on, giving these ubscupulous Wankers, sorry misspelt I meant Bankers te power to do exactly as they like and can steal masses of our money with impunity.
Now we have Herr Cameron (the self proclaimed son of Thatcher) continuing the trend.
The thing is, where do all these Tory Bastards go when evicted from Parliament, many end up with their names on the letter heading of these self same finance houses.
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Re: Does the UK trade deficit matter to you?

Post by Guest on Sun Jan 29, 2012 11:49 pm

Stox 16 wrote:
To me the UK was built on our world export with UK companies known the world over.

Growing up, the UK was perceived as perhaps the strongest trading nation on the block. British good were everywhere over here, and were considered quality stuff, from he finest automobiles, Rolls Royce Silver Shadow, Rolls Royce Bentley, Jaguar XKE, Triumph TR-6, on don to fine sliver, fine linen, jus about everything except cuisine. And the Royal Navy still laid claim to at least a strong and close second in domination of the seas, actually more like co-first.

Then one day as an adult I took stock and the vaunted Royal Navy was having to "make-do" in the Falklands. My reaction? "Wha' happened?" Then, as the eighties and nineties rolled by, it seemed that UK industrial production, especially leading edge technological production, had disappeared or been absorbed into tri-nation consortiums. Avro once meant, "Watch out, something earth shaking is coming down the pike. Supermarine, what happened to them? Rolls Royce is still producing the finest turbofans in the world, but how long?

Stox, I hadn't thought about all this in relationship to trade deficits, but now that you’ve pointed it out, do British shipyards still exist? Or is all shipbuilding "outsourced" to South Korea?

In the finest State of the Union speech I've heard as an adult, save for recordings of FDR, which I've posted in its entirety on this forum, President Barack Obama addressed the disease of outsourcing. That policy, here and over there, seems like Barney Fife shooting himself in the foot with the lone bullet Sheriff Andy will let him carry.

No wonder your trade deficit is growing; the UK has historically been natural-resource poor, save for an abundance of coal, but the UK has also historically been rich in human resources, such as innovate thinking and consequent "lead-the-way" production. I mean, the industrial revolution started in the UK. Blue water navies started with the RN. And the super carriers we depend upon to project air power world wide would not be possible had the UK not (1) invented the aircraft carrier, (2) invented projection of air power (Taranto), (3) invented the steel decked carrier, (4) invented the steam catapult, (5) invented the angled deck, and (7) invented "call the ball" the landing light sys crucial in recovering aircraft back aboard the carrier. And did you know that Royal Navy aviators (Fleet Air Arm? Not sure) figured out how to land Corsairs aboard carriers and then taught the USA Navy how to us its best carrier borne fighter from carriers?

Stox 16 wrote:
I doubt another Falklands type war but could the Government rely on the US owned Cunard or P&O Cruises to supply the equivalent of the QE2 and Canberra who were critical to our success then. The US were reluctant allies then, since they saw their interests more in South America with Argentina than with their 'Special Relationship' (a one way road if ever there was).

Stox

That’s not how all Americans USV saw it. I saw a delicate situation delicately handled. Reagan didn’t want to give the impression that the UK couldn’t handle its business, so the unqualified aid (Reagan said something like, “Tell us what you need from us, and it’s yours”) was offered and accessed low key, under the radar.

We’ve familiarity dealing with despotic Central and Latin American despotic regimes over here. That’s one reason so many Americans USV appreciate Canada more than we can say in words. I recognize, for instance, the Canadian National Anthem, and can sing along if lead by Canadians (can’t so I on my own), but I wouldn’t know the Mexican national anthem if it walked up to me and slapped me in the face.

I was in a room with nothing but Americans USV when your once-admired-by-me Thatcher stood in front of 10 Downing Street and announced that the Union Flag once again flew over South Georgia Island. A spontaneous cheer broke out, and many tears of gratitude and pride flowed.


Last edited by RockOnBrother on Mon Jan 30, 2012 6:45 pm; edited 1 time in total
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Re: Does the UK trade deficit matter to you?

Post by Stox 16 on Mon Jan 30, 2012 12:58 am

RockOnBrother wrote:
Stox 16 wrote:
To me the UK was built on our world export with UK companies known the world over.

Growing up, the UK was perceived as perhaps the strongest trading nation on the block. British good were everywhere over here, and were considered quality stuff, from he finest automobiles, Rolls Royce Silver Shadow, Rolls Royce Bentley, Jaguar XKE, Triumph TR-6, on don to fine sliver, fine linen, jus about everything except cuisine. And the Royal Navy still laid claim to at least a strong and close second in domination of the seas, actually more like co-first.

Then one day as an adult I took stock and the vaunted Royal Navy was having to "make-do" in the Falklands. My reaction? "Wha' happened?" Then, as the eighties and nineties rolled by, it seemed that UK industrial production, especially leading edge technological production, had disappeared or been absorbed into tri-nation consortiums. Avro once meant, "Watch out, something earth shaking is coming down the pike. Super marine, what happened to them? Roll Royce is still producing the finest turbofans in the world, but how long?

Stox, I hadn't thought about all this in relationship to trade deficits, but now that you’ve pointed it out, do British shipyards still exist? Or is all shipbuilding "outsourced" to South Korea?

In the finest State of the Union speech I've heard as an adult, save for recordings of FDR, which I've posted in its entirety on this forum, President Barack Obama addressed the disease of outsourcing. That policy, here and over there, seems like Barney Fife shooting himself in the foot with the lone bullet Sheriff Andy will let him carry.

No wonder your trade deficit is growing; the UK has historically been natural-resource poor, save for an abundance of coal, but the UK has also historically been rich in human resources, such as innovate thinking and consequent "lead-the-way" production. I mean, the industrial revolution started in the UK. Blue water navies started with the RN. And the super carriers we depend upon to project air power world wide would not be possible had the UK not (1) invented the aircraft carrier, (2) invented projection of air power (Taranto), (3) invented the steel decked carrier, (4) invented the steam catapult, (5) invented the angled deck, and (7) invented "call the ball" the landing light sys crucial in recovering aircraft back aboard the carrier. And did you know that Royal Navy aviators (Fleet Air Arm? Not sure) figured out how to land Corsairs aboard carriers and then taught the USA Navy how to us its best carrier borne fighter from carriers?

Thanks Rock, good reply.
Well we are down to maybe two or at the most three shipyards today. you dead right in saying...That policy, here and over there, seems like Barney Fife shooting himself in the foot with the lone bullet Sheriff Andy will let him carry. you are also 100% dead right Rock about.... President Barack Obama addressed the disease of outsourcing. as this has become a real disease eating away at the very core of our economy. its lead to so many long term problems that are now so hard that our right wing friends in power just will not or cannot face up too. as you may know the US still has a fleet that is maned by most US crews. We gave all this up. In the 1980s Bobby is quite right in saying we moved our whole economy away from our industrial core industries and into the world of banking and finance sector.... it was my view that the time that we would come to Roo this in years to come. that UK exports would fall away and that our industrial core would weaken and in the end move overseas. while this would be the death nail for our Merchant fleet that over the years serviced us so very well.

So what we have ended up with is any unbalanced economy with all the UK eggs in one very small brusket indeed. so why was this done? Well Alan Clarke now dead Tory MP summed this up very well in my view. in his TV doc about the History of the Tory party. What he pointed out was that Mrs Thatcher feared the power of the Unions in the 1970s? where was Trade union power to be found? yes inside the UKs core industrial base? so how to weaken it? easy kill this area of the UK economy and this will kill trade union power. for her its was that simple. as there was no real union power within the City of London, nor do they strike but better still they pay the Tory party at the same time. CHECKMATE. that thought. so while all of this was going on we start to see the UK trade gap and at the same time our Merchant fleet fall away. also our shipyards are closed and sold off.

So here we are today. in Alan Clarke words. the 30 year experiment is now over. yet does Alan Clarke's story end there? no, as a big part of the economic experiment was to change how we think. as it would never work if people did not feel happy about what they called a shareholders democracy. but how could this be done? ah yes deregulation of the City. this will lead to there shareholders democracy and how will working and middle class fund this? o yes that is right...borrowing on there homes. just like many did back in the 1930s. so by 1989 we was in the hands of the City while now living in a consumer demand and lead economy that was built on cheap lending or what I called a house built on sand. but how to keep the left on its toes? well easy. you take away job security and do this by using disease of outsourcing. as who would go on strike with this hanging over your head? so here we are today...fighting and talking about the banking and finance sector, while the rest of our economy is left top hang out to dry.

did Labour make a mistake in government? well I am sad to say we fell for the Tory economic plan hook line and sinker. Why...well because the Left even come to believe that a 1930s banking crash could never quite take place in 2008. Me..I never believed in from 1997 to 2008. as did Germany follow us into banking and finance sector at the cost of her industrial base? No.....Did Japan follow us.....No....Did anyone...No not really...US a bit...but she still keep her industrial base......No...it was only us....How bloody stupid was that...now we will pay for it..big time Rock
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Re: Does the UK trade deficit matter to you?

Post by Stox 16 on Mon Jan 30, 2012 1:03 am

bobby wrote:Hello astradt, you are quite right, and its because of our reliance on financial services that we are now being held to ransom by them, allowing the managers of these fanance houses to get the indescent oversised bonuses, threatening us that if they dont get them, they will phuk off abroad. If we had a high quality manufacturing base as we once had, we could now be telling those greedy bastards to phuck off any where thy please, cos we dont need you. But Thatcherite Britain made sure we had nothing to fall back on, giving these ubscupulous Wankers, sorry misspelt I meant Bankers te power to do exactly as they like and can steal masses of our money with impunity.
Now we have Herr Cameron (the self proclaimed son of Thatcher) continuing the trend.
The thing is, where do all these Tory Bastards go when evicted from Parliament, many end up with their names on the letter heading of these self same finance houses.

Well posted Bobby
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Re: Does the UK trade deficit matter to you?

Post by Stox 16 on Mon Jan 30, 2012 1:07 am

astradt1 wrote:You don't need ships to move Finacial Services around the world........And it's the Finacial Sector that creates most of our over seas trade....mores the pity.....

astradt1
but mate it cannot go on like this any more....lets face it...if we had 1,000 modern merchant ships we could move every one else stuff around the world. no we just hire them. anyway, our Merchant fleet matches our economy too a tea
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Re: Does the UK trade deficit matter to you?

Post by Guest on Mon Jan 30, 2012 3:05 am

Stox 16 wrote:
... US a bit...but she still keep her industrial base

You've heard of the "Obama bail-outs?" One key industry was... the automobile industry. As of 2012, Chrysler is back in the game, Ford is solid, and General Motors, called "Government Motors" by "Barney Fife's" that didn't see the importance of keeping automobile producing companies over here instead of letting them slip away to Japan and Korea, has once again become the number one car company in the world. And oh yeah, they're paying back the loans.

GM unveils fuel-cell car

Keeping the technological edge, something that I so desire that the US and its true allies maintain, is a decades long concern. We've been friendly competitors that have benefited from each other's technological expertise for my entire lifetime. When the USAF needed a bomber that handled like a fighter and could sustain flight at over sixty thousand feet in recon configuration, who filled the bill? English Electric, with its Canberra. When the USMC needed an s/vtol strike fighter that could deliver some hurtin' and still hold its own in a dogfight, who filled the bill? Hawker Siddeley, who licensed their Harrier to McDonnell Douglas. And when the RAF needed numbers in 1940, North American produced the Mustang, which after mating with the Rolls Royce Merlin, became the war winner that put allied fighters over Berlin.
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Re: Does the UK trade deficit matter to you?

Post by Stox 16 on Mon Jan 30, 2012 4:52 am

RockOnBrother wrote:
Stox 16 wrote:
... US a bit...but she still keep her industrial base

You've heard of the "Obama bail-outs?" One key industry was... the automobile industry. As of 2012, Chrysler is back in the game, Ford is solid, and General Motors, called "Government Motors" by "Barney Fife's" that didn't see the importance of keeping automobile producing companies over here instead of letting them slip away to Japan and Korea, has once again become the number one car company in the world. And oh yeah, they're paying back the loans.

GM unveils fuel-cell car

Keeping the technological edge, something that I so desire that the US and its true allies maintain, is a decades long concern. We've been friendly competitors that have benefited from each other's technological expertise for my entire lifetime. When the USAF needed a bomber that handled like a fighter and could sustain flight at over sixty thousand feet in recon configuration, who filled the bill? English Electric, with its Canberra. When the USMC needed an s/vtol strike fighter that could deliver some hurtin' and still hold its own in a dogfight, who filled the bill? Hawker Siddeley, who licensed their Harrier to McDonnell Douglas. And when the RAF needed numbers in 1940, North American produced the Mustang, which after mating with the Rolls Royce Merlin, became the war winner that put allied fighters over Berlin.

Rock
first of all nice reply. you sum up the big difference between what we did with out industry in the 1980s and what the US did with it. The US fort hard to keep an the automobile industry alive. now it will pay off for you, as it will cut down you imports of cars into the US. were as our Government was only far too happy to get shot of it. Today the US sees many manufacturing companies are cautiously shifting gears from retrenchment to expansion as business activity revives and credit markets improve. After nearly two years of focusing on cash and liquidity preservation and cost reduction, they are now looking to build capacity and explore growth opportunities. However, more US companies are investing in internal M&A capability development. The US companies are putting in place processes, tools, techniques, and training to prepare their organizations for specific types of markets

As a result, the gap between the prepared and the unprepared is growing at an accelerated pace. While the U.S. companies strive for low-cost production manufacturing are positioning themselves for an upswing in business activity in 2012 and you can see the start of this with growth at 1.7%. The whole US economy is on the move Whether its targets in product line or an entire company. for me the US Companies understand the changing marketplace and related challenges and addressing it. We in the UK are addressing nothing at all. we are still failing to address our manufacturing and export needs or deal with the banks in funding and backing this sector. all we are address is the needs of the finance sector, while not facing up to the hard fact that this will not dig us out of our economic hole we are in. The fact is Rock Obama has got your economy moving slowly and pushing you right wing all the way to back the US industry and manufacturing. we in the UK have nothing like this at all. you just cannot cut your way out of a recession. a lesson that the great FDR shows us from the 1930s. it was dead right then and its still dead right today. As the Great Depression was being felt intensely across the country. President Herbert Hoover's popularity was falling as voters felt he was worsening the depression. While FDR's persistent optimism and activism contributed to a renewal of the national spirit while spearheadeding major legislation and issued a profusion of executive orders that instituted the New Deal—a variety of programs designed to produce relief (government jobs for the unemployed), recovery (economic growth), and reform (through regulation of Wall Street, banks and transportation).


in the UK case we have excessive borrowing with now growth at all. We have nothing like this over here. that is the bottom line Rock.

I will tell you some thing Rock, be biggest news story in the UK is over a silly bank mangers bonus payment. what's more this is for a guy who has been leading a failing bank. could you ever see this happening in the US? God....No...you fail you go...no bonus payments for failure there... is that not right Rock?
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Re: Does the UK trade deficit matter to you?

Post by Stox 16 on Mon Jan 30, 2012 5:09 am

astradt1 wrote:You don't need ships to move Finacial Services around the world........And it's the Finacial Sector that creates most of our over seas trade....mores the pity.....

astradt
I Bet now that in 20 years time the UK will have no merchant fleet at all. we will have to hire one. how mad would that be for a country in the middle of the sea
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Re: Does the UK trade deficit matter to you?

Post by oftenwrong on Mon Jan 30, 2012 7:24 pm

The UK trade deficit probably matters less to us than should the Portuguese Trade Deficit. Germany borrows money from International Banks at 2% interest. For Portugal, their rate is SEVENTEEN PERCENT. How can any economy be expected to survive AND grow under such a burden?

Which leads to the obvious question - how can the Eurozone survive unchanged?
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Re: Does the UK trade deficit matter to you?

Post by Stox 16 on Tue Jan 31, 2012 3:06 am

[quote="oftenwrong"]The UK trade deficit probably matters less to us than should the Portuguese Trade Deficit. Germany borrows money from International Banks at 2% interest. For Portugal, their rate is SEVENTEEN PERCENT. How can any economy be expected to survive AND grow under such a burden?

Which leads to the obvious question - how can the Eurozone survive unchanged? [/quot

Well you rise an interesting question Oftenwrong that in itself covers three areas on here. Europe and economics, trade deficit. well all three subjects are linked right now as you know. The trade deficit first. Well it matters a great deal more than say borrowing on the international bond markets. Let me try to explain....Our trade figures and our trade deficit are a far greater judge as to how well or bad the UK economy is working. as form these figures the Government of the day can see clearly what areas of the economy is doing well on the international stage and how strong or weak are core industrial production is doing within key sectors. good trade exports lead to strong GDP and growth. Now bonds markets cannot show you any of this. as bonds can change over night and are never a good indication of economic GDP Growth within the economy. up to last year most people in the UK had no real idea what the UK 5 year or 10 year bond markets where in fact doing. this has change? Why...well this is because this Government is borrowing and overspending a great deal. So they are using the low 5 and 10 Year bond markets to justify there large borrowing but tell us we are borrowing at some sort of cheap right for now.

So how do they work?
Written From my own companies training programme

Government bonds are bonds that are issued by central governments. Governments issue bonds to borrow money to cover the gap between the amount they receive in taxes and the amount they spend; to re-fund existing debt; and/or to raise capital. Government bonds are usually considered the highest quality bonds in the market because they are backed by central governments (unless of course they are emerging market bonds where defaults are a serious risk in many cases). Most individual investors focus on buying and selling government bonds.

In Europe, Government Bonds are also called sovereign bonds. In the UK, Government Bonds are also called gilts; in France, OATs; in Germany, Bunds; in Italy, among other terms, BTPs. In the US, Government Bonds are also called US Treasuries or T-Bills. Yield is a critical concept in bond investing because it is the tool you use to measure the return of one bond against another.

In essence, yield is the rate of return on your bond investment. However, it is not fixed, like a bond’s stated interest rate. It changes to reflect the price movements in a bond caused by fluctuating interest rates.

Here is an example of how yield works: You buy a bond, hold it for a year while interest rates are rising and then sell it. You receive a lower price for the bond than you paid for it because no one would otherwise accept your bond’s now lower-than-market interest rate. Although the buyer will receive the same amount of interest you did and will have the same amount of principal returned at maturity, the buyer’s yield, or rate of return, will be higher than yours was—because the buyer paid less for the bond.

There are numerous ways of measuring yield, but two—current yield and yield to maturity—are of greatest importance to most investors. Although Government Bonds are usually considered high quality credit, not all Government Bonds are rated the same. Thus although some individual investors tend to think Government Bonds are always rated AAA and virtually free from credit risk, this is not the case in Europe. Consequently, investors face credit (ratings) risk in investing in Government bonds, since the ratings could be downgraded. Some Government Bonds such as German Bunds, US Treasuries and UK gilts have been considered virtually free from credit (ratings) risk, as the bonds are backed by the authority and taxing authority of the German, US or UK government and these governments are unlikely to default on their bonds.

However, all government bonds are affected by other types of risk, principally interest-rate risk and inflation risk. Investors who invest in a government bond that is not in his/her home currency also face currency/exchange rate risk since the value of his/her investment could go down as well as up depending on what happens to the currency exchange rate. For example, US dollar investments are worth less against European Euros and pounds sterling because the exchange rate has changed significantly between the dollar and European currencies.

So what about Junk Bonds?

Junk Bonds - These are the bonds that pay high yields to bondholders because the borrowers don't have any other option. Their credit ratings are less than pristine, making it difficult for them to acquire capital at an inexpensive cost. Junk bonds are typically rated at 'BB'/'Ba' or less.
Think of a bond rating as the report card for a company's credit rating. Blue-chip firms that provide a safer investment have a high rating, while risky companies have a low rating. he obvious caveat is that junk bonds are high risk. With this type of bond, you risk the chance that you will never get your money back. Secondly, investing in junk bonds requires a high degree of analytical skills, particularly knowledge of specialized credit. Short and sweet, investing directly in junk is mainly for rich and motivated individuals. This market is overwhelmingly dominated by institutional investors.
Written by my own company for training

So your question.....How can any economy be expected to survive AND grow under such a burden?.....not unless Government bank bond debt held within the main banks is cut by up to 65%. then it could just.

you're other question....Which leads to the obvious question - how can the Eurozone survive unchanged?....No it cannot survive without changes take place within the Euro zone. the key areas being debt held in 5/10 year government bonds within other EU counties and not held by the original host country. while keep interest rate low for 5 years or so. its also needs a central bank to manage key areas of economic policy within the Euro zone. its this leadership question that is leading to instability within markets. not so much the Greek debt say. its my view that far to much money and time has been spent by Germany and France for this to now fail. how it will look after all of this is still open to question and debate.



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Re: Does the UK trade deficit matter to you?

Post by oftenwrong on Tue Jan 31, 2012 9:57 am

Meanwhile, British foreign policy seems to be to keep one foot on the floor in the hope of avoiding ever closer involvement with the Eurozone.
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Re: Does the UK trade deficit matter to you?

Post by Stox 16 on Wed Feb 15, 2012 3:23 am

oftenwrong wrote:Meanwhile, British foreign policy seems to be to keep one foot on the floor in the hope of avoiding ever closer involvement with the Eurozone.

This would be a fair point if it was not for the fact that the Eurozone is our biggest trading partner oftenwrong
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Re: Does the UK trade deficit matter to you?

Post by oftenwrong on Wed Feb 15, 2012 11:40 am

Britain is a member of the European Union, but not in the Eurozone.
Having said that, our most important single customer is probably Ireland, which is.
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Re: Does the UK trade deficit matter to you?

Post by Stox 16 on Wed Feb 22, 2012 12:55 am

oftenwrong wrote:Britain is a member of the European Union, but not in the Eurozone.
Having said that, our most important single customer is probably Ireland, which is.

quite oftenwrong
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Remember when?

Post by astradt1 on Sat Dec 28, 2013 7:13 pm

Do you remember when the government of the day used to talk about exports and import balance to gauge how well or how badly the economy was doing, how they talked about balance of payments.

Now all they talk about GDP, but then again it's hard to talk about exports when Britain's is a mainly service industry economy......
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Re: Does the UK trade deficit matter to you?

Post by methought on Wed Jan 08, 2014 10:11 pm

Toxic debt has left us at the mercy of the bail-outs which come with conditions to destroy welfare, keep 'free trade' from being accessible to any but the mega-rich, and ensure that work is only available for the lowest paid to put more wealth in the pockets of the super-rich. Debt is marketed as the way out of poverty for 3rd world countries. It was a trap that Reagan was happy to spring on the 3rd world, which has now come back to bite all of us. Now we have China taking over our nuclear industry, building new plants to replace the obsolete ones, and we are supposed to trust them to meet our current standards for worker safety (Health and Safety gone mad).

Starbucks has a monopoly of university coffee shops.

Fracking is all set to make more money for oil companies to keep them sweet so we don't run out of real oil....

We are over a barrel.
What would Labour do differently? Halllooooo is there anybody there?????

Yes the balance of payments matters. We all need to get ourselves individually out of debt, cooperatives would be a start, legislation that allows communities to develop alternative green (free) energy is a vital necessity but currently blocked to protect the monopolies.

The Tories are in the back pocket of the multi-nationals and they have got us all stuck in there with them. It is a global economy, so new growth in Britain needs to be twin-tracked, with self-sustaining (not-for-profit?) start-up ventures alongside the gambler banks trading on the world markets for a quick buck profit.
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Re: Does the UK trade deficit matter to you?

Post by oftenwrong on Wed Jan 08, 2014 11:27 pm

All part of the Establishment blueprint for fortifying the rich at the expense of the poor. When the Banks monumentally f***ed-up in 2008 they were bailed-out with OUR money, which continues to made available to them by our Government in a period of so-called austerity (for many but not all).

As has been written elsewhere, the Monied classes tell the elected representatives what they will do.
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Re: Does the UK trade deficit matter to you?

Post by oftenwrong on Wed Jan 07, 2015 2:17 pm

.... and only a year further on, some Countries in the EU are reporting NEGATIVE INFLATION for the first time.  Lower prices may be good news for the consumer, but what does it say to our Exporters whose main target is the EU?

http://www.msn.com/en-gb/money/other/eurozone-deflation-puts-pressure-on-ecb-to-launch-qe-stimulus/ar-AA7SooK
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Re: Does the UK trade deficit matter to you?

Post by oftenwrong on Thu Jan 08, 2015 10:26 pm

If you watched a programme on BBC2 TV between 9 and 10 p.m. today, you now understand why everyone seems to have more money than you do.

For the past three decades, Chancellors have been able to say that Britain is a wealthy Country, because foreign investors have recognised London as a great Safety Deposit box in which to lodge their money, almost tax free.

That money is used to suck profits from ordinary British people who desperately need somewhere to live.

Labour is on the right course by threatening to tax those people heavily, because apart from any other argument there is nowhere else for them to go. An annual tax on assets would be even more effective than income tax.

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Re: Does the UK trade deficit matter to you?

Post by patakace on Wed Jan 14, 2015 8:51 am

oftenwrong wrote:If you watched a programme on BBC2 TV between 9 and 10 p.m. today, you now understand why everyone seems to have more money than you do.etc



That money is used to suck profits from ordinary British people who desperately need somewhere to live.



That's a fine logical post !!
A type of event happens , called CT
But then -- according to you ---the Sucker God steps in takes away profits from individuals. Even though they have nothing to do with brokering Class CT type events .

Individuals are taxed --- nothing to do with sucking up their profits .
Why ?
Because individuals do not make profits .
Rather , they produce earnings .
Unless they live under Liberal rule when they are given money and " things" which are styled Benefits .
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Re: Does the UK trade deficit matter to you?

Post by oftenwrong on Wed Jan 14, 2015 5:46 pm


UK inflation rate falls to 0.5% in December

Bank of England Governor says, "A little inflation greases the wheels of commerce".

http://www.bbc.co.uk/news/business-30797531

So is this good news or bad news? For the wage-slave it's better, because the weekly shop and putting petrol in the car will no longer be rushing up and up way ahead of wages. But
paying-off your debts may seem a bit more of an effort. Likewise if you've been able to save a bit for a rainy day, interest rates will stay derisory, though that won't be quite
as damaging as it may have been in the past, because the value of your savings will no longer be eroded so quickly by the increased cost of living, which has risen by 22% in the
last five years.

To put that into perspective, if you'd put £100 under the mattress at the beginning of 2010, it would obviously still be the same twenty Fivers (or ten Tenners). But if you now
go out and spend that mattress money you will only receive seventy-eight pounds-worth of goods or services. That's what inflation does to your savings while it's greasing the
palms of suppliers.


Any Responses to be in comprehensible English, please. No jargon.
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Re: Does the UK trade deficit matter to you?

Post by boatlady on Wed Jan 14, 2015 6:47 pm

I'm no expert but I do seem to remember reading somewhere that neither very high nor very low inflation is a desirable thing - doesn't low inflation tend to lead to stagnation and high inflation leads to stuff like having to take a wheelbarrow full of notes to buy a loaf of bread? Something like that, anyway.

So, in a sense, would that mean the low inflation rate is likely to be a problem if it persists?
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Re: Does the UK trade deficit matter to you?

Post by patakace on Wed Jan 14, 2015 6:52 pm

oftenwrong wrote:
UK inflation rate falls to 0.5% in December


etc

To put that into perspective, if you'd put £100 under the mattress at the beginning of 2010, it would obviously still be the same twenty Fivers (or ten Tenners).  But if you now
go out and spend that mattress money you will only receive seventy-eight pounds-worth of goods or services.  That's what inflation does to your savings while it's greasing the
palms of suppliers.


Any Responses to be in comprehensible English, please. No jargon.

I think we all know how contrite the Left is privately for nearly dragging this country over the cliff and half way towards a Greek type scenario .
If there is one matter that should turn people back to prayer it is the need to give thanks to a team of economic and financial experts who have already undone so much of the damage that monsters like Blair and his idiot successor produced .

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Re: Does the UK trade deficit matter to you?

Post by patakace on Wed Jan 14, 2015 7:01 pm

boatlady wrote:I'm no expert but I do seem to remember reading somewhere that neither very high nor very low inflation is a desirable thing - doesn't low inflation tend to lead to stagnation and high inflation leads to stuff like having to take a wheelbarrow full of notes to buy a loaf of bread? Something like that, anyway.

So, in a sense, would that mean the low inflation rate is likely to be a problem if it persists?


Experts underline the need to guard against deflation which they actually regard as highly unlikely at this moment in terms of forecasts--- Mark Carney et al .
As long as we achieve further and continued growth through our private sector in the developing world , we should continue to achieve great things .
And hanging on to US shirt tails is of paramount importance , at least while the $US rules -- which it presently does .
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Fire and Water

Post by oftenwrong on Wed Jan 14, 2015 10:47 pm

boatlady wrote: .... neither very high nor very low inflation is a desirable thing....

A familiar situation. A glass of water can be very refreshing, but three days of continuous rain may pose a problem; Fire in the grate provides welcome warmth, but a fire in the thatch roof can be an emergency.

Too much inflation reduces the value of both wages and savings, while too little induces stagnation.

Everything in moderation, please.
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Re: Does the UK trade deficit matter to you?

Post by patakace on Thu Jan 15, 2015 7:57 am

oftenwrong wrote:
boatlady wrote: .... neither very high nor very low inflation is a desirable thing....


Everything in moderation, please.


You need to think this one through , methinks .
Wink
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