[Politics] Tory meltdown finally arrived [was: incoming]...

[The Clamp]

it may be a bit of a no no for him to be seen using the train atm

How so? And why not a car?

Or the Megabus?

 

[Half Time Pies]

fair point 1. point 2, i have a silver crown coin that says money can be a "thing". i get the money is debt/credit, and can see where that could lead. not sure government debt (vs private debt) must exist for money supply to exist.

It does because of the simple accountancy need to balance the books, banks can only create new money (liability of the bank) by creating a loan/ debt (asset of the bank). This is the same as the Bank of England as it is for commercial banks.

 

[Gwylan]

Barely anyone, other than a dwindling hardcore, will own up to voting tory, but the sussex area will still look like a sea of blue on a map the day after the next election.

I'm not sure of that. I'd be willing to bet a shiny British pound that Lewes and Eastbourne will go Lib Dem. And I think there's a very good chance that Worthing East and Crawley both go Labour (and possibly Worthing West and Hastings & Rye too)

 

[rogersix]

How so? And why not a car?

Or the Megabus?

helicopters are cool

 

[Nobby Cybergoat]

I'm not sure of that. I'd be willing to bet a shiny British pound that Lewes and Eastbourne will go Lib Dem. And I think there's a very good chance that Worthing East and Crawley both go Labour (and possibly Worthing West and Hastings & Rye too)

That still leaves a sea of mid sussex as well as Kent and Surrey which will look blue. Even when Blair was winning stupid majorities, many of those seats were rock solid tory

 

[The Clamp]

helicopters are cool

Sadly, for a dingus like Sunak, this may be his actual reasoning.

 

[Harry Wilson's tackle]

it may be a bit of a no no for him to be seen using the train atm

His train would have passed through Faversham, and there is a risk I may have been on the platform, boing. Boo. BOO!

 

[Machiavelli]

fair point 1. point 2, i have a silver crown coin that says money can be a "thing". i get the money is debt/credit, and can see where that could lead. not sure government debt (vs private debt) must exist for money supply to exist.

@Half Time Pies has explained it better but, just to try an alternative route: your first two statements re point 2 are very much in tension with one another. I say tension, because they don't contradict one another: the thingness of your crown is obvious; but in order to create that thing there was a parallel entry on the other side of the ledger sheet.

 

[Gwylan]

That still leaves a sea of mid sussex as well as Kent and Surrey which will look blue. Even when Blair was winning stupid majorities, many of those seats were rock solid tory

I think some of those 'safe' Tory seats are going to disappear too. Raab has already accepted that his Esher seat is doomed, Hunt could be in trouble too. I can also see Woking going yellow. There may be some big shocks in Surrey and Kent if Lab and LibDems could get tactical voting sorted.

We're in a different era from Blair: the Tory party has changed completely and a lot of Tory voters in these constituencies have tended to be more pro-remain than the rest of the party. There's also been a demographic shift as more younger families are moving out of London: just look what's happened in Worthing.

I'm not saying that Sussex, Kent and Surrey are going to be pattterned yellow and red, but there's definitely going to be less blue

 

[Thunder Bolt]

 

[beorhthelm]

It does because of the simple accountancy need to balance the books, banks can only create new money (liability of the bank) by creating a loan/ debt (asset of the bank). This is the same as the Bank of England as it is for commercial banks.

understand that, but this is seperate from the government, even accounting for view the Treasury and BoE seperation is tenuous. i have read various BoE papers on money creation. this is where the MMT lobby go off and say therefore all spending is created from bank actions, so we can spend infinite money.

@Half Time Pies has explained it better but, just to try an alternative route: your first two statements re point 2 are very much in tension with one another. I say tension, because they don't contradict one another: the thingness of your crown is obvious; but in order to create that thing there was a parallel entry on the other side of the ledger sheet.

the other side of the balance sheet does not need to be government borrowing. in BoE and commercial lending it isn't.

 

[beorhthelm]

its screwed as its being used as a inquiry on goverment. i saw there are calls to question Osborne on his budgets and their impact. its a circus that will be in town for years. other countries have opend and closed inquiries already, keep narrow remit: review of procedures, lessons learnt, done.

 

[ken tiler]

understand that, but this is seperate from the government, even accounting for view the Treasury and BoE seperation is tenuous. i have read various BoE papers on money creation. this is where the MMT lobby go off and say therefore all spending is created from bank actions, so we can spend infinite money.

the other side of the balance sheet does not need to be government borrowing. in BoE and commercial lending it isn't.

MMT economists don’t argue that governments should spend infinite amounts of public money as this would be inflationary. The spending however is not constrained by the need to fund expenditure either by taxation or “borrowing”. They argue that inflation can be controlled with a job guarantee and tweaks to taxation rather than by interest rates.

 

[The Clamp]

its screwed as its being used as a inquiry on goverment. i saw there are calls to question Osborne on his budgets and their impact. its a circus that will be in town for years. other countries have opend and closed inquiries already, keep narrow remit: review of procedures, lessons learnt, done.

Most other countries didn’t have a corrupt, filibustering government that broke its own rules with a “let the bodies pile high” approach to the pandemic.

 

[beorhthelm]

MMT economists don’t argue that governments should spend infinite amounts of public money as this would be inflationary. The spending however is not constrained by the need to fund expenditure either by taxation or “borrowing”. They argue that inflation can be controlled with a job guarantee and tweaks to taxation rather than by interest rates.

of course, we should be increasing taxes right now to deal with inflation. cant think why the politicans aren't going for that.

 

[Audax]

“Tiresome “ but correct MMT advocate here. Firstly, The Bank of England is a branch of government and secondly it is legally required to issue money for government expenditure when instructed to do so by Parliament.

I made a similar point to the other fella who pushes MMT incessantly a few months back that I'm going to ask you shortly. Never did get a reply from the other fella, which I took to assume (given he was still banging on about MMT answering other peoples easier questions) that the answer would have been bad for MMT.

For MMT to work, surely it needs *global* financial markets to (almost universally) agree that it is a correct, and best possible, theory for managing government finances (those with a fiat currency). Can MMT work without that agreement in global financial markets that it is a workable theory? It doesn't look that way ... or at least, not as a 'light switch' change over from historic monetary theory (Truss tried a light switch change and got electrocuted). Maybe as a gradual shift over a prolonged period of time we might see it shift from "theory" to "in practice". But it's not there yet.

And that is what makes that other person who tediously promotes MMT so annoying: he approaches it as if it's already proven beyond doubt and we should all just believe it. Problem is, it isn't. There's more economists out there who think MMT would fail than who think it would succeed.

 

[Thunder Bolt]

I agree it's a slightly crude yardstick, however, Cameron came to power on a ticket to reduce the deficit and used that to inflict 10 years of austerity on us.

Also, last November we spent 7.3bn on interest payments - a record. To put that into perspective it would cost us 4bn to give Nurses and other NHS workers the pay rise they need - almost HALF the interest payment for JUST ONE MONTH. The cost of Tory failure

It didn’t help when we lost the Triple A rating so paying more and more interest.

 

[Since1982]

That still leaves a sea of mid sussex as well as Kent and Surrey which will look blue. Even when Blair was winning stupid majorities, many of those seats were rock solid tory

Mid Sussex has a strong chance of going Lib Dem. The boundary has been redrawn, the strongest Tory vote has gone to the new EG and Uckfield constituency which is where the current Mid Sussex MP is scuttling off to. HH and BH went Lib Dem at the last local elections, Hassocks and Hurst are being folded into Mid Sussex and they are Lib Dem as well. Plus Tories lost control of Mid Sussex DC last month having had all 52 seats as recently as 2015. The tide is turning.

 

[zefarelly]

of course, we should be increasing taxes right now to deal with inflation. cant think why the politicans aren't going for that.

Not even that odious criminal **** Zahawi ? Oh no, he's calling for an abolition of inheritance tax.

 

[Half Time Pies]

understand that, but this is seperate from the government, even accounting for view the Treasury and BoE seperation is tenuous. i have read various BoE papers on money creation. this is where the MMT lobby go off and say therefore all spending is created from bank actions, so we can spend infinite money.

the other side of the balance sheet does not need to be government borrowing. in BoE and commercial lending it isn't.

Ive never heard a MMT economist say that you can spend infinite money, you can't without potentially causing inflation.

Reserves (digital money) are simply deposit balances held at the central bank. By definition, only the central bank can provide central bank deposit accounts and therefore, it follows that only the central bank can provide reserves.

The mechanism by which the Bank of England creates reserves is either by purchasing government bonds (which create an asset on its balance sheet) or by making a direct loan to the government (shown also on the asset side of the balance sheet as ways and means - essentially the governments overdraft facility), in both cases the reserves created are shown on the liability side of the balance sheet. To create physical cash the BofE just takes a portion of its reserves and converts it to notes and coins.

Essentially when a central bank issues reserves, the main counterpart asset on the central bank balance sheet is generally some form of government financing.

I have paraphrased most of the above from this article on the BofE website: https://www.bankofengland.co.uk/-/m...s-balance-sheet-speech-by-gertjan-vlieghe.pdf