....and there was me thinking this country was broke....

[mattx]

Top Tory Toff David Cameron and his out of touch chancellor Osbourne keep telling us that the country has NO money and WE ARE IN THIS TOGETHER and all the cuts to services are necessary but has just found 10 Billion [ yes that's 10 BILLION pounds ] to loan the IMF ?!?! Amazing George you two faced Tory Toffed Idiot.

 

BBC News - UK offers £10bn loan to the IMF

[pcstru]

I offer this story to perhaps help otherwise innocent readers understand economics ...

 

It is a slow day in a little Greek Village.

 

The rain is beating down and the streets are deserted.

 

Times are tough, everybody is in debt, and everybody lives on credit.

 

On this particular day, a rich German tourist is driving through the

Village, stops at the local hotel and lays a €100 note on the desk,

Telling the hotel owner he wants to inspect the rooms upstairs in order to

Pick one to spend the night.

 

The owner gives him some keys and, as soon as the visitor has walked

Upstairs, the hotelier grabs the €100 note and runs next door to pay his

Debt to the butcher.

The butcher takes the €100 note and runs down the street to repay his debt

To the pig farmer.

The pig farmer takes the €100 note and heads off to pay his bill at the

Farmers' Co-op, the supplier of feed and fuel.

 

The guy at the Farmers' Co-op takes the €100 note and runs to pay his

Drinks bill at the taverna.

 

The publican slips the money along to the local prostitute drinking at the

Bar, who has also been facing hard times and has had to offer him

"services" on credit.

 

The hooker then rushes to the hotel and pays off her room bill to the

Hotel owner with the €100 note.

The hotel proprietor then places the €100 note back on the counter so the

Rich traveller will not suspect anything.

 

At that moment the traveller comes down the stairs, picks up the €100

Note, states that the rooms are not satisfactory, pockets the money, and

Leaves town.

 

No one produced anything.

No one earned anything.

However, the whole village is now out of debt and looking to the future

With a lot more optimism.

 

So £10Billion to the IMF ... who knows ... just might be a bargain!

 

;-)

[mattx]

I know quite a few local schools and services who would benefit from a loan of smaller magnitude. People would be able to keep their jobs and keep their houses. Their children would have a better education too and everyone would reap the benefits. However as businesses are not getting loans and governements are using TAX payers money to prop up failing banks who should be lending to your hotelier, butcher, pig farmer, and publican but arn't then your example is the largest crock of bull I've read for a while. Your story may work in an ideal world, but I'm afraid to say this world does not exist. Banks are not lending, un-employment is going up, fuel is going up, taxes on EVERYTHING is going up, companies are defaulting on their loans, inflation is on the rise and people are sick of paying through the nose in regards to the cost of living. Your story is a good guide to indictate how it should work, but in in reality it never does.

[DrCheese]

Top Tory Toff David Cameron and his out of touch chancellor Osbourne keep telling us that the country has NO money and WE ARE IN THIS TOGETHER and all the cuts to services are necessary but has just found 10 Billion [ yes that's 10 BILLION pounds ] to loan the IMF ?!?! Amazing George you two faced Tory Toffed Idiot.

 

BBC News - UK offers £10bn loan to the IMF

 

Your post is somewhat overkill. We'll be giving this money to the IMF as the consequence of allowing other economies to fail would cause us a lot more damage in the longrun. He's hardly doing it because he's a "two faced Tory Toffed Idiot."

 

Becoming a financially isolated country would do us no favours.

Edited April 20, 2012 by DrCheese

[mattx]

Your post is somewhat overkill. We'll be giving this money to the IMF as the consequence of allowing other economies to fail would cause us a lot more damage in the longrun. He's hardly doing it "for the lulz" because he's a "two faced Tory Toffed Idiot."

 

This is a bloke whose family runs a textiles business which is failing and that has made a loss over the last few years. This bloke is part of a family who because of this, has made people redundant from the business but at the same time awaded themselves pay increases.

Like I said - "two faced Tory Toffed idiot"

[pcstru]

your example is the largest crock of bull I've read for a while. Your story may work in an ideal world

 

Err ... it was just an amusing story ... certainly not meant to be taken as any kind of accurate model of the world or some kind of scientific view - "A small Greek village (+/- 10%)".

 

Your story may work in an ideal world,

Yes! An ideal ... story like ... total fantasy world ... created only, well I assume only, to ... err ... amuse.

but I'm afraid to say this world does not exist.

No!!! Don't be afraid!! It's a *made up world*. A *story* world. I'm quite glad it doesn't exist. Story worlds always turn out to have painful flaws - hell, just ask the three little pigs.

Banks are not lending, un-employment is going up, fuel is going up, taxes on EVERYTHING is going up, companies are defaulting on their loans, inflation is on the rise and people are sick of paying through the nose in regards to the cost of living. Your story is a good guide to indictate how it should work, but in in reality it never does.

Amen brother. I agree. 100%.

 

Keep calm but please do carry on

Edited April 20, 2012 by pcstru

[mattx]

 

Amen brother. I agree. 100%.

 

Keep calm but please do carry on

 

:-)

 

Bless you too my child.....

[Flatpackhamster]

Your post is somewhat overkill. We'll be giving this money to the IMF as the consequence of allowing other economies to fail would cause us a lot more damage in the longrun. He's hardly doing it because he's a "two faced Tory Toffed Idiot."

 

Becoming a financially isolated country would do us no favours.

 

I'd agree with you, in principle, if the Eurozone could be saved. It can't. This is just our money down the pan. We'd be far better off paying down our debt with any surpluses.

[Dos_Box]

Also take into account that this is a loan, not a gift. The money will come back, with interest.

[bodminman]

At the end of the day, any money that is currently being loaned to the IMF and/or the ECB is just keeping financial ruin for the EU at bay for the immediate future. There are still fundamental issues with the European single currency that haven't been resolved and are unlikely to ever be resolved. These issues were known about when the Euro was lauched and the big wigs just papered over the cracks and hoped that they would find solutions to things as they went along!

 

The Euro is the one single currency that has hamstrung a recovery. Nobody will invest in the Euro!

 

I think it's time that those at the top admit that the euro has been a failure and start working out a method to disband the currency.

Edited April 21, 2012 by bodminman

[mattx]

Also take into account that this is a loan, not a gift. The money will come back, with interest.

 

HA HA HA HA - nice one Dos_Box - HA HA HA HA - funniest thing I've read this year !!

[mattx]

So we are have no money for the disabled, no money for pensioners or child benefit, the NHS is trying to save £20 billion, whilst at the same time we continue to pay 20% VAT on fuel whilst having fewer police on the streets and soon a health system that will mean only the rich can afford. People out of work is on the rise, inflation is on the up, it now costs more to fill up your car than it does to do a weekly shop and BRITISH families are expecting to find £9,000 to send their kids to university. And to top that all off they get rid of one of the top tax brackets !!

Someone better hold me back if I ever meet this tory toff in the street. The bloke is a first class pillock who cares only for this rich buddies. And to think people in this very country actually voted for him is incredible.

[CyberNerd]

Japan has lent a total of $186 billion and the US $172 billion

£10 billion might be a bargain if it stops the eurozone going titsup.

[mattx]

Japan has lent a total of $186 billion and the US $172 billion

£10 billion might be a bargain if it stops the eurozone going titsup.

 

Good for them. I don't live in Japan.

[CyberNerd]

Good for them. I don't live in Japan.

 

you do live in Europe though

[Flatpackhamster]

Japan has lent a total of $186 billion and the US $172 billion

£10 billion might be a bargain if it stops the eurozone going titsup.

 

£10 Billion more than we already give.

[CyberNerd]

if no countries lent any money to IMF, it would cost UK a hell of a lot more than £10 billion. It would be nice if we didn't have to.

[localzuk]

Amazing how short the memory of some people is... The IMF bails countries out when they're failing. Guess who went to that very organisation in 1976 and borrowed money because the country had become bankrupt? Oh yes, the UK.

 

If countries hadn't put money into the IMF, what would have happened in the UK?

 

Short sighted thinking is what keeps on getting the country into a mess, don't be part of that group of people too.

[sted]

Japan has lent a total of $186 billion and the US $172 billion

£10 billion might be a bargain if it stops the eurozone going titsup.

 

i suspect its too late for euro but thats what you get if you have entry rules you ignore and let countries in that couldnt even approach qualifying normally. When does it become throwing good money after bad and at what point do you have to allow mistakes to have consequences for the people who made them

[Flatpackhamster]

Amazing how short the memory of some people is... The IMF bails countries out when they're failing. Guess who went to that very organisation in 1976 and borrowed money because the country had become bankrupt? Oh yes, the UK.

 

If countries hadn't put money into the IMF, what would have happened in the UK?

 

Short sighted thinking is what keeps on getting the country into a mess, don't be part of that group of people too.

 

OK, for those in favour of this bailout, a quick question. Which of the two situations do you think is actually going to happen?

 

1) UK contributes to Eurozone bailout. Eurozone remains intact, Italy, Spain, Greece and Portugal get their economies back in good order and stop overspending. Eurozone goes from strength to strength, repays IMF loan.

 

2) UK contributes to Eurozone bailout. Eurozone crashes and dies because the PIGS can't stop spending. IMF loan remains unpaid, UK loses its money.

 

 

What's "short sighted" about refusing to shovel money in to a project that can't possibly succeed? Isn't it just plain dumb to keep chucking money at it?

[bodminman]

All this money flowing is just delaying the inevitable! The should just accept the euro is a failure and deal with the fallout/consequences now.

[localzuk]

OK, for those in favour of this bailout, a quick question. Which of the two situations do you think is actually going to happen?

 

1) UK contributes to Eurozone bailout. Eurozone remains intact, Italy, Spain, Greece and Portugal get their economies back in good order and stop overspending. Eurozone goes from strength to strength, repays IMF loan.

 

2) UK contributes to Eurozone bailout. Eurozone crashes and dies because the PIGS can't stop spending. IMF loan remains unpaid, UK loses its money.

 

 

What's "short sighted" about refusing to shovel money in to a project that can't possibly succeed? Isn't it just plain dumb to keep chucking money at it?

 

You are being far too 'black and white' about it. Whether or not the Euro survives, the economies of failing countries will still need investment in the form of loans, debt write-offs and other such things. The UK is stood to lose a *lot* of money if Italy, Spain, Greece and Portugal simply collapse - they owe institutions in the UK a lot. By us underwriting loans to them, they will basically keep those countries afloat, and allow them to trade, thereby increasing the potential that they won't default on the massive amount they owe our banks.

 

Also, the money being lent isn't 'our money' as such, it is money that is borrowed using our AAA rating, and therefore has very low yields. We pay interest on this debt, yes, but at a much lower rate than the countries it eventually ends up in would be able to get. To get the money, they have to agree austerity measures and fix their broken economies.

 

The money is not simply to shore up the Euro, it is to ensure we don't end up going bust because of a knock on effect! That is what is short sighted.

[bodminman]

Yes I agree localzuk but I and a lot of other people including some leading economists think that as soon as the euro breaks down the better because at that point we can start to fix things properly. Instead we have countries throwing money at a problem that currently has no solution and at what point do we stop throwing money at it?

 

Yes the reality is that there will be one hell of a mess to sort out but if the decision was made to break the euro up at the beginning of this crisis then a lot of the major hurdles would have be navigated by now.

[localzuk]

But your implication is that the money that is being 'thrown' at it is disappearing somehow. It isn't, it is going into the economies of the broken countries, just like it would if the Euro didn't exist.

 

So, in effect, the issue of money being given to the IMF is a non-issue. The issue that the various governments and the public should be discussing is the cost-benefit analysis of the Euro itself. If it fails, there are a few problems - uncertainty (which, to be fair, we have at the moment already), an unbalanced set of trading partners - ie. those that lose out from the collapse would import less from us, meaning overall our exports would likely fall.

 

But either way, the countries that 'collapse' would still need bailing out.

 

Edit: To my anonymous detractor - 'utter rubbish'. My what a great argument you've presented, countering the basics of how economics works and has worked for a *very* long time.

[mattx]

Amazing how short the memory of some people is... The IMF bails countries out when they're failing. Guess who went to that very organisation in 1976 and borrowed money because the country had become bankrupt? Oh yes, the UK.

.

 

I don't care what happend in 1976, I care what happens now - and we keep getting informed we have no money for our OWN country but we continue to give to the IMF who then give it a country [ Greece ] who fiddled their books to get into Europe - sort of wants me to stick Cameron's Big Society up where the sun does no shine.