Hmm, well, gosh….

On the savings side the issue multi-parts but all indicate one problem. First, savings are rising. Second, savers are intensely risk-averse. Third, savers can find nothing better than cash or gilts to save in right now, despite the incredibly low interest rates. And, fourth, those same low rates are not encouraging business to do anything more than refinance existing debt or fund losses. Actual job-creating investment in real activity is virtually non-existent.

Business investment seems to be running at £50 billion a quarter. That’s:

Business investment is a component of gross fixed capital formation (GFCF) by the private sector and public corporations, excluding investment in dwellings and costs of ownership transfer. It is a UK construct and not internationally comparable.

It also doesn’t include any buying of financial assets. Now, mebbe £200 billion a year ain’t enough or summat but it’s not nuttin’.

6 thoughts on “Hmm, well, gosh….”

  1. Compiling a Spud Lexicon.

    First: a word that will be followed by a list of poorly argued drivel arbitrarily divide into sentences and paragraphs.

    Venn diagram: 2 circles that do not illustrate the relationship suggested by the title

    Mindmap: an unnumbered list of points (see “First”)

    Reasonable: unreasonable or possibly illegal

    Fairness: the need for higher levels of taxation

  2. “Second, savers are intensely risk-averse.” Citation needed. How does one fat Spud in Ely know this?

    “Third, savers can find nothing better than cash or gilts to save in right now” just asserting something doesn’t make it factually accurate. Again no evidence is forthcoming, probably because the assertion is untrue

    “fourth, those same low rates are not encouraging business to do anything more than refinance existing debt or fund losses. Actual job-creating investment in real activity is virtually non-existent.” It would not be very surprising if this were partially true for Q2 but does he really think that no companies were expanding before then? And, of course, in pharmaceuticals and IT there has been a lot of activity lately. Cosmetic manufacturers and gin distillers switched to producing hand cleansers for example and created new production lines. PPE suppliers might have been busy as well.

    I guess we will have to wait for the June 30 Investment figures to see just how accuarte Spud’s evidence- free assertions are. I suspect they will all turn out to be wrong

  3. The Meissen Bison

    Diogenes

    May I submit for inclusion:

    Candidly – I am about to be gratuitously offensive;
    I note – I am trying to sound professorial;
    You’re time here is up – I’ve been rumbled;
    Fifthly – Why are you still reading this?

  4. @Diogenes “Mindmap: an unnumbered list of points (see “First”)”

    It’s usually worse than this. He just takes a sentence and thinks he’s being clever by separating the words into little bubbles linked by arrows.

    He just
    Takes a sentence……………….and thinks
    He’s being clever……………….by
    ……………………………..separating
    ………………………….. the words
    into little bubbles
    linked by…………………………arrows

  5. “On the savings side the issue multi-parts …”

    I take issue with “issue” being used as a euphemism for “problem”. As for the verb “multi-parts” … dear God, what an ass.

  6. @Diogenes

    PMI has shown a large increase in latest release

    Saving? If peeps banned from going out to buy, what does Ritchie think peeps should do? Eat the money?

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