UK Trade Deficit Worst Since 1697

#1
According to Sky News

Britain's goods trade deficit with the rest of the world stretched to £8.3bn in November, its widest margin since records began more than 300 years ago

Surely this goes well past the 1997 watershed most New Liebour politicians constantly refer to. I'm no mathematician but thats about £183 for every man, women an child in the UK in one year. Thats alot of Hi-fi's and Oranges we're buying on credit from Johnny foreigner!

Edited* My maths was bloody awful!
 
#2
Deadreckon said:
According to Sky News

Britain's goods trade deficit with the rest of the world stretched to £8.3bn in November, its widest margin since records began more than 300 years ago

Surely this goes well past the 1997 watershed most New Liebour politicians constantly refer to. I'm no mathematician but thats about £183 for every man, women an child in the UK in one year. Thats alot of Hi-fi's and Oranges we're buying on credit from Johnny foreigner!

Edited* My maths was bloody awful!
You're wrong.

Thats per month - not year. I think the current deficit is something like 700 Billion all in. Forecast for 1 Trillion by the time this lot get the boot. It's tad more than 187 quid per person, I think the number is something like 20 something thousand per household.

Don't forget though, Gordon is the one to steer us though the crisis, I can't see how as he's the incompetent cnut that steered us into it.
 
#4
Ord_Sgt said:
Deadreckon said:
According to Sky News

Britain's goods trade deficit with the rest of the world stretched to £8.3bn in November, its widest margin since records began more than 300 years ago

Surely this goes well past the 1997 watershed most New Liebour politicians constantly refer to. I'm no mathematician but thats about £183 for every man, women an child in the UK in one year. Thats alot of Hi-fi's and Oranges we're buying on credit from Johnny foreigner!

Edited* My maths was bloody awful!
You're wrong.

Thats per month - not year. I think the current deficit is something like 700 Billion all in. Forecast for 1 Trillion by the time this lot get the boot. It's tad more than 187 quid per person, I think the number is something like 20 something thousand per household.

Don't forget though, Gordon is the one to steer us though the crisis, I can't see how as he's the incompetent cnut that steered us into it.
You're not far wrong with that figure, OS. And this is just the beginning of the debt black hole that our children and grand children could be born into. Whilst the balance of trade is a crucial indicator of our country's financial well being and future prosperity, we should also consider the fiscal debt the government is accruing to save the necks of those who placed us in this position, as well as the debt it has accrued so far for the running of the state. It all looks bleak (especially when we consider the criminal off balance sheet debt that Brown has amassed with PFI projects). And, sadly, things will likely get much worse as the economic situation worsens.

In effect, it's likely that 'quantitative easing' will begin to occur sometime in the next 12 months. It may be the only option open to the government, as it is becoming more likely that there will be a bond market implosion sometime soon (beginning with the sovereign bonds and followed by corporate and municipal bonds). If HMG is unable to sell its debt, then it will have a restricted array of choices. It could increase the yield of bonds, thus increasing the weight of the debt to be accrued by the tax payer. Though, investors may look at the UK and consider that, even with high rates of return on bonds and gilts, the country is such a basket case that there is a high probability of the British government defaulting on its repayments. In this instance, printing money would be the only option, though HMG could sell off national assets to foreign interests (Imagine the mineral rich national parks being sold to foreign mining companies for development).

Now, were the government to start up the printing presses, then two main effects would come about. Firstly, sterling would likely be devalued as the rules of supply and demand would come into play. The more pounds there are in circulation, then the less value each pound has. As such, in this instance, we could expect an inflationary period. However, policy makers are also considering the idea that the current climate is so deflationary, that the currency may be able to survive printing. Technically there is a certain truth in this statement. However, things are only so deflationary and, in order for the government to avoid trashing the pound, it would need to know when to stop printing. In essence, the government would need to have a clear handle on the state of the broader supply of money, as well as have the discipline needed to halt quantitative easing to prevent inflation getting out of hand.

Secondly, were the government to instigate hyperinflation then British debts would be devalued rapidly, thus wiping the slate clean. However, were this to happen we would be faced with massive problems. Not only would the country face incredible social and economic problems, but its reputation amongst foreign investors would be shot. It really would, in my view, signal the end of Britain being a developed economy. This would be the most likely time for revolution, or a police state, in my view.

Though, none of us are prophets and we don't know what is going to happen. Ultimately, it's possible that all western economies will be forced to print to survive and eradicate their debts. In this instance, at least our beloved Britain wouldn't be alone in the wilderness.

Edited for spelling.
 
#5
Thanks OS. I knew I shouldn't have done the math's on an empty stomach :oops: !
 
#6
Contrarian said:
Though, investors may look at the UK and consider that, even with high rates of return on bonds and gilts, the country is such a basket case that there is a high probability of the British government defaulting on its repayments.
I do believe that the UK already has a lower credit rating than McDonalds. LINK

Contrarian said:
In this instance, printing money would be the only option, though HMG could sell off national assets to foreign interests (Imagine the mineral rich national parks being sold to foreign mining companies for development).
I can see Gordon flogging off our remaining gold reserves first. Of course he'd have to announce it first to give the gold price time to collapse.

Many of the current government cut their teeth in the lefty councils of the 1980s. A favourite trick among the loony left when things got desperate was to raise cash by mortgaging council buildings and arranging for the repayments to kick in after they'd left office. A bit like PFI but using existing assets.

Stand by for:-

Tower of London - Brought to you by the Disney Corporation

The Buckingham Palace Hilton - The only 5 star hotel on The Mall

Horse Guards Parade - In association with National Car Parks

Trafalgar Square - Admission £5

The Spearmint Rhino National Gallery and Pole Dancing Venue
 
#7
Thanks for that excellent summary Contrarian.

The 20k was roughly what I remember from 'The Bumper Book of Government Waste', it was closer to 25k though. Of course that was all before the current round of spending money we don't have.

It's worth noting the UK's finances are in such a state we don't even qualify to join the Euro any more.
 
#8
Gordon Brown is starting to make the Healey/Callaghan/Wilson Government look like prudence personified. He must be praying that the rubbish is collected this winter and the power cuts don't materialise. We have had the sterling devaluation, now all we need is the IMF. Suppose in a way, that function is partly being carried out by the BoE.

I would pick up the phone to Mugabe for a bit of economic advice.....
 
#9
So when exactly did we we have anything but a deficit?

Also, its a bit much blaming the government - ANY GOVERNMENT - for the countries trade deficit. Blame manufacturers for crap or overpriced goods, blame foreign governments for allowing sweat shop antics by their manufacturers. Blame lack of innovation, blame the banks for making our inventors take their brain children to foreign parts.


Oh, and where does the Hate article mention the balance of trade - even once? They are wittering on about Daves gutless antics.
 

Biped

LE
Book Reviewer
#10
Contrarian said:
In effect, it's likely that 'quantitative easing' will begin to occur sometime in the next 12 months. It may be the only option open to the government, as it is becoming more likely that there will be a bond market implosion sometime soon (beginning with the sovereign bonds and followed by corporate and municipal bonds). If HMG is unable to sell its debt, then it will have a restricted array of choices. It could increase the yield of bonds, thus increasing the weight of the debt to be accrued by the tax payer. Though, investors may look at the UK and consider that, even with high rates of return on bonds and gilts, the country is such a basket case that there is a high probability of the British government defaulting on its repayments. In this instance, printing money would be the only option, though HMG could sell off national assets to foreign interests (Imagine the mineral rich national parks being sold to foreign mining companies for development).
Funny you should mention that Contrarian.

Only the other week, Deutche Bank reneged on 2 billion Euros worth of bonds issued to Bank of China. They missed the deadline for settling them, and in so doing, saved 160 million Euros.

This broke one of the centuries old unwritten rules of banking - settle the bonds the day they become due, and it REALLY, REALLY p!ssed off the Chinese, who wrote letters to all the other national banks worldwide with which it holds bonds, and warned them in NO uncertain terms not to do the same as the Germans.

The last straw for the worldwide economy is when national banks start defaulting on issued bonds, and Germany has just done it to the Chinese.

Nobody see that one reported? Not many - it was in small print in the Independent, but nobody AFAIK followed it up.

Thanks to 12 years of ZANU gobment, all the pain and tears of Thatcher's time as PM, during which she put this country through hell to balance the books and repair the damage from 50 years of poverty and mismanagent, has been undone. All the money that was paid off, all the jobs that were created, all the wealth of the nation that came as a direct result of her stewardship is now GONE, and we are deep in the sh!t.

When our currency can't even hold its own against the Phillipine Peso, you know it's bad.

For those of you who kept voting Labour, I salute you - well done.
 
#11
Sven said:
Also, its a bit much blaming the government - ANY GOVERNMENT - for the countries trade deficit. Blame manufacturers for crap or overpriced goods, blame foreign governments for allowing sweat shop antics by their manufacturers. Blame lack of innovation, blame the banks for making our inventors take their brain children to foreign parts.
Earth to Sven...
 
#12
whitecity said:
Sven said:
Also, its a bit much blaming the government - ANY GOVERNMENT - for the countries trade deficit. Blame manufacturers for crap or overpriced goods, blame foreign governments for allowing sweat shop antics by their manufacturers. Blame lack of innovation, blame the banks for making our inventors take their brain children to foreign parts.
Earth to Sven...
Sven is the one on Earth this time. The article is about the trade deficit, not the national debt. If the 'it's all Brown's fault' narative were viable, the UK's trade deficit should be going through the floor as the UK economy tanked. As it is, these figures represent falling exteral demand.
 
#13
parapauk said:
whitecity said:
Sven said:
Also, its a bit much blaming the government - ANY GOVERNMENT - for the countries trade deficit. Blame manufacturers for crap or overpriced goods, blame foreign governments for allowing sweat shop antics by their manufacturers. Blame lack of innovation, blame the banks for making our inventors take their brain children to foreign parts.
Earth to Sven...
Sven is the one on Earth this time. The article is about the trade deficit, not the national debt. If the 'it's all Brown's fault' narative were viable, the UK's trade deficit should be going through the floor as the UK economy tanked. As it is, these figures represent falling exteral demand.
due to issues such as poor exchange rate, low interest rates, low confidence in UK ecomony (and the gov'ts ability to deal with the problems), poor returns on investment, crap infrastruture and an economy which has been too heavily dependent on the financial sector and a collaspe of our manufactoring sector - ALL HAVE BEEN CAUSED BY OR INFLUENCED BY GORDON BROWN'S DECISIONS OVER PAST 12 YEARS.
 
#14
parapauk said:
Sven is the one on Earth this time. The article is about the trade deficit, not the national debt. If the 'it's all Brown's fault' narative were viable, the UK's trade deficit should be going through the floor as the UK economy tanked. As it is, these figures represent falling exteral demand.
Which doesn't appear on his little list.

There is much to be said in what he writes. Sadly, his conclusions let him down. The government, irrespective of shape, size and colour is directly responsible for setting economic policy: manufacturing, employment, trade etc etc.
 

Biped

LE
Book Reviewer
#15
Sven said:
So when exactly did we we have anything but a deficit?

Also, its a bit much blaming the government - ANY GOVERNMENT - for the countries trade deficit. Blame manufacturers for crap or overpriced goods, blame foreign governments for allowing sweat shop antics by their manufacturers. Blame lack of innovation, blame the banks for making our inventors take their brain children to foreign parts.


Oh, and where does the Hate article mention the balance of trade - even once? They are wittering on about Daves gutless antics.
That's right Sven, it's not the job of government to make sure the banks don't do anything reckless . . . it's the job of the voter.

It's not the fault of the government if trade and industry goes abroad because OTHER governments provide better tax positions.

It's not the fault of government that highh street stores have been dying on their feet for well over a year - after all, they didn't change the policy that allowed local councils to raise revenue by making a business out of parking fines.

It's not the fault of the government that the saved pensions of millions of people have shattered in value - after all, those funds weren't raided for £6 billion of punitive and retrospective taxes.

It's not the fault of the government for selling our national gold reserves (that's right, a chunk of our national wealth) at knock down prices . . . . oh, it was.

It's not the fault of government that EU directives supercede laws voted in by parliament, and which in a lot of cases offer only cost increases to businesses without any benefits.

Basically, SVEN, as far as I'm concerned the remit of ANY government is simple, considering it runs the country, sets laws, and directs and taxes business and the people! The remit is this: During the tenure provided by the votes of the electorate, its remit is to ensure the HEALTH, WEALTH, PEACE AND SECURITY OF THE NATION AND ITS PEOPLE!

Has this government ensured the financial profitably of UK PLC over the last 12 years - has it MANAGED the economy properly? No.

Has this government ensured the peace of this country and its people? No, its sent us to a number of wars will under-equipped and funded soldiers, leading directly to the deaths of a number of them.

Has this government MANAGED to provide security for the people of this nation? I give you the tube and bus bombings.

Has this government MANAGED to provide for its people in terms of safety and peace - no, crime is running riot because they have ham-strung and politicised both the police AND courts, and criminalised anyone who defends themselves.

Has this government MANAGED our freedoms properly - allowing us, the electorate to live free, without intrusion and interference in our private lives? No, they allow unelected officials from a large number of quangos and government departments to spy on us with hidden cameras without a court order, they allow same said people to follow us, see our private correspondence, investigate our computers, check our phone records, follow us on endless CCTV cameras, track our internet usage, remotely access our PC hard drives and more.

This government should do WHATEVER it take to ensure our health, wealth, safety, security and peace. The democratic system that was forced upon the people promised this, the current system DEMANDS that we allow such people govern us, the current system DEMANDS and GETS the right to GOVERN our banking system, our courts, our police, our money, our security, our streets, our land, our commerce, our industry, our private homes and our private lives.

IF THIS SYSTEM GOES T1TS UP - DON'T BLAME THE ELECTORATE! They merely operate within the rules and systems that the goverment puts in place and legislates for.
 
#16
'Quantitative Easing' sounds like the same nasty complaint one uses Vasaline for when suffereing from Hemorroids.

Maybe Pa Broone and the whole Nu Liebore-Pf use vast quantities of 'Quantitative Easing' to grease their Collective 'Where The Sun Dont Shine' whatsits!! :p

It certainly sounds 'painful', the sort of thiny that happens in Easter Business.... 'Greeasing of Palms to make the money go round.... In the UK's case, the ferking Banks are holding on to Our Cash given to them like the proverbials Ducks Erse!! 8)

I wonder what f*ckwit it is who is paid vastly sums of our dosh to think up these stupid technical terms like 'Quantitative Easing'..... why not call it what it is.... 'printing more ferking dosh!' :?
 
#17
i didnt think trade deficit had anything to do with individual debt, its purely that the UK imports more than it exports and is to do with industry AND consumer spending?? scuse my ignorance if i am wrong....
 
#18
Well it basically means the UK is buying more (nominally) goods and services from abroad then is managing to sell. What this means in practice I suppose in a nutshell is effectively with a trade defecit the UK is sustaining a standard of living beyond its means of production. Either it jacks up production of goods/services to sell abroad or reduces its consumption of goods from abroad to balance the budget. Or uses monetary policy to try and resolve the issue which in itself results in inflation (which is a from of tax) and would arguably result in a drop in standards of living.

Have I missed the boat on this (its been a few years since I studied Mankiw)

edited to bold phrase.
 
#19
Thanks to 12 years of ZANU gobment, all the pain and tears of Thatcher's time as PM, during which she put this country through hell to balance the books and repair the damage from 50 years of poverty and mismanagent, has been undone. All the money that was paid off, all the jobs that were created, all the wealth of the nation that came as a direct result of her stewardship is now GONE, and we are deep in the sh!t.

Where's the wealth gone? Has it just vanished? No, it's been squandered on maintaining a welfare culture that was created by Maggie as the biproduct of embracing globalisation - funded in her day by North Sea Oil and by transferring strategic publically owned assets into private hands. The transfer of private debt to the public (a la NR) is a Friedman wet dream and is a continuation of what Maggie started: that is, the market is King not sovereign states. Maggie only went halfway with the great experiment but they didn't have the guts to take it to it's conclusion and could mask an army of unemployed workers by spending the substantial incomes they reaped.

Whilst Gordo and his cronies' management of the country has been staggering in it's incompetence, I'm afraid what we face now is Maggie's legacy.
 
#20
The trade deficit will right itself in time, with the value of the pound so low a lot of people won't be able to afford foreign goods anyway.

Sven, you're flogging a dead horse on this one - they well and truly blew it, only the amount of pain to right it by the next few administrations is in doubt. Labour are going to be sidelined for another generation after this mess, if not consigned to history all together.
 

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