Saturday, 16 June 2012


The Chancellor's decision to "kick start" the economy by lending the banks £140 billion shows how incompetent he is, or maybe how under the influence of the malign banking system which fund the Tory Party.

I do not know what they teach in university economic lectures but it certain does not seem to be common sense.

All are agreed the British economy needs rapid overhaul but those in charge do not have a clue as to how it should be done.

One of Osborne's ideas is to make mortgages easier to obtain which sounds good to people who do not think it through but a moment's reflection reveals that with houses in short supply all this will do is put the price up. Thus first time buyers will have to pay more and saddle themselves with more debt, while existing property owners reap an unearned reward.

These inflated "assets" can then be used to buy more goods and benefit "the high street" controlled in most part by big business. Also most of the products they sell are imported so causing our debt to rise.
But is this the intent?
The banks make money they have been given by lending it out at high interest rates and the City of London makes its profit at every turn, and will continue to reward the Tory party.

It will not do the average British person any good at all.

Here are two suggestions from me, on how to use this £140 billion conjured out of thin air.(I have many more but for now just these two).

Cut National insurance for employers which will encourage them to take people on.

CUT THE BANKS OUT OF THIS LENDING. The present scheme will only make them richer and produce nothing of value.
Put the money into sorting the infrastructure of this country out which would be creating USEFUL jobs and allow the money to be spread around the country by the use of sub contractors and British manufactured products. That way unemployment would be cut and the tax take would rise and expenditure on welfare decrease.

Any money left should be lent to small business direct, cutting out the banks and their interest demands cutting overheads and making them more competitive internationally.

The EU is blamed for much of the current financial malaise and this is partly true but the financial mismanagement of Britain by this and the last governments has made our vulnerability worse.

I believe some of Osborne's action is to protect the banks against a EU breakup.
But the banks having foolishly lent to the EU and made £billions for themselves and their City friends should bear the consequences and if they go broke, so be it, so long as small depositors are protected.
If I lend somebody £1000 and they go broke it's my loss for being so foolish and trusting and I would have to bear the consequences and the banks are no different.

Unfortunately the British economy has been built on this sleazy fast buck system to the detriment of productive industry. The Chancellor should be working to reverse this dependence as quickly as possible, but true to form he is giving the banks more money to dish out at a profit.

What would happen if a bank or banks defaulted on their obligations.
Perhaps nothing much if deposits were guaranteed.
All tangible assets and goods would still be there, the roads, railways airports, houses etc.
It would be just the banks and their wealthy speculators who would lose lines on a computer.Money does not exist.
Our people freed from the debt burden could then thrive as Iceland is doing after defaulting.

Much of the trouble in Britain and the EU is due to the creaming off of wealth by the financial institutions and the people through no fault of their own are paying for it.


P S I will give my thoughts on the many other ways for our country to return to prosperity at a later date.

1 comment:

Andyj said...

For anyone requiring a dictionary of banking. Here it is:-