Tears, tears to my eyes

First, the Bank of England seriously considered increasing interest rates in May. If that happens the proverbial will be mingling with the fan faster than you can imagine: the UK is sitting on a mountain of private debt that many can barely afford.

And people are already under enormous pressure. Retail sales volumes fell by 1.2% in May as rising prices depressed consumer spending growth.

It’s not just that austerity mixed with Brexit does not work: it is now an outright disaster.

Bring on the Green New Deal: it was designed for situations like these.

Richard Murphy, professor of practice at Islington Technical College, is suggesting that we should have both fiscal stimulus and monetisation of spending to deal with rising inflation.

I’m just not sure whether they’re tears of sadness, rage or laughter at this howling idiocy.

21 comments on “Tears, tears to my eyes

  1. The private debt is a mere foothill (fuckhill?) compared to the Himalaya of gubmint debt.

  2. Tim – they should be tears of pity, at the sad sight of a fellow economist* on a slow public descent into full mental incapacity, if not raving, saliva-dripping, lunacy.

    * in the loosest possible meaning of the word

  3. Mr Ecks,

    At £1.5trn, total household debt is almost exactly the same as total government debt. Throw in corporate debt and it’s a mountain range.

  4. Andrew M – and presumably both numbers ignore unfunded pension obligations (presumably all or mostly government) which would be a further non-insignificant molehill, and which would I suppose increase if the interest rate went up, whereas funded pension schemes (largely private) would I suppose breathe a sigh of relief.

  5. BraveFart said:
    “Tim – they should be tears of pity, at the sad sight of a fellow economist on a slow public descent into full mental incapacity, if not raving, saliva-dripping, lunacy.”

    Didn’t Murphy used to say he’s a chartered accountant, not an economist? I wonder if the Chartered Accountants’ Benevolent Association should help him? They have been advertising their mental health services recently.

  6. “Richard

    Didn’t Murphy used to say he’s a chartered accountant, not an economist?”

    He’s everything. When tower blocks burn down, journalists turn to him for advice.

  7. Richard, Andrew is right. Murphy is that rare specimen – a true polymath, like Leonardo da Vinci.

    Why oh why he can’t be persuaded to solve the nuclear fusion problem instead of wasting his time with tax I will never understand. I’m sure he could have a functioning design for a viable and economic plant knocked up on a paper napkin while scoffing a ploughman’s lunch in a pub.

  8. He’s an anamath. Omninescient, as the I think the Meissen Bison has dubbed him.

  9. The level of government debt is terrifying. As to the level of personal debt, how much of that is mortgage debt? My daughter and husband have £260k of mortgage debt, soon to increase to £600k; but that will be paid off when their parents shuffle off this mortal coil. That said, the virtue of thrift has largely disappeared, apart from in some islands of the middle class, and many people satisfy their consumer desires by borrowing. My maxim is: only borrow to expand a business, never for personal consumption. But then I’m very old-fashioned.

  10. How long before the “hard working majority” decides it’s fair game to plunder the savings of the thrifty mugs? In a democracy and with evil wankers like the current Labour front bench almost anything is possible.

  11. Is there an opposite of polymath and have we found him?

    Rob – wasn’t that what Cyprus tried a few years back? You know HMRC already have the power to raid your bank account for what they say is their money?

  12. hes a nasty cunt -Adam Sawyer says:
    June 15 2017 at 3:22 pm
    Raising interest rates = UK economy shooting itself in the head.

    How has it come to this? Are there any actors in the UK economy who will enjoy a net benefit from a rates rise after its impacts on demand are accounted for?

    Reply
    Richard Murphy says:
    June 15 2017 at 3:52 pm
    Pensioners believe they will

    Note how they vote
    i asked Moqifen says:
    June 15 2017 at 9:02 pm
    so what’s so wrong with pensioners hoping for a better return on their savings ? the jibe about voting was particularly snide.

    Reply
    Richard Murphy says:
    June 15 2017 at 9:44 pm
    Pensioners need to realise it is not their savings that provide for them

    It is young people willing to work that provides for them

    And if interest prices young people in to poverty they’re not going t work for the well-being of the elderly: they’re going to vote their pensions down .

    the man’s got a nasty streak a mile wide (unfortunately his intellect isn’t as wide as a footpath

  13. “Paul Raine says:

    But isn’t it all political? If the state had a much bigger say in things then we certainly wouldn’t be reading about terrible fires in blocks of flats.”

    “Richard Murphy says:

    I agree”

    *****************************************

    The 1/5 Prof misses the irony here.

    Nothing bad ever happened in the USSR, if you believed what you read in Pravda.

  14. the man’s got a nasty streak a mile wide

    He claims to be a Quaker. Perhaps he’s from the fundamentalist wing. Or perhaps he’s just a really nasty little bastard who believes he is a unicorn.

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