I gave a talk to Ipswich Quakers and friends last night and whilst doing so said that there was no chance the UK deficit would be cleared during the life of the next parliament whatever any politician says.
The reason is obvious. If the deficit is to be cleared then someone else has to go into deficit instead: that’s the way the economy works. Consumers, business, government and overseas finance have always to balance between them. But we have what FT commentators call a ‘global savings glut‘ where consumers with any wealth are stashing cash, and not saving it.
Is he really trying to insist that people are stashing cash under their beds? No, no, he’s not. He’s insisting that people are just letting that cash pile up in their bank accounts.
Which is saving. And yes, it does finance investment. Because that’s where all that credit creation by the banking system comes from. You know, that fucking shite that he keeps complaining about?