Lockdown of our Economy

Oh dear. The fruits in my garden have not even flowered yet. Our season is different to yours. I have just found an egg and my neighbour has kindly given me some bread, so I am going to try to cook it now with a cup of coffee. I keep leaving the kitchen to see who is messaging me.
Just a part copy of a recent message I sent to a friend who lives many miles away. It illustrates some of the practicalities of the present lockdown and the worldwide crisis.

It is indeed a worldwide crises with all our liberties and comprehensions open for debate. A return to the new normal is often quoted, but do we really need the normal back with all its injustices. It could be a time for us to plan for a new future which is environmentally friendly and fair for all.

It is a very sad time for so many throughout the world and I believe that the lockdown regulations should be followed. However, the implications for economics and our future healthcare is enormous. I will write in more detail after the virus has passed, as I do not want to write only in the realms of hypothesis. It is clearly a time that we can plan for a new a more fairer society for all.

Following Science only, when it is confused with value led social Science is surely not the way forward. Laying blame can also be unhelpful and we must surely look positively forward for our environment and our future generations.

Despite the future economic slump we can be positive and plan for the future and build a new world order without war, progressive and just for all.

Perhaps our fruits will flower, if we work at it together and in solidarity.

Protected: Lockdown of our Economics

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The chaos of Brexit!

Whilst I agree with some comments, that prior to article 50, the UK Government should have had a clear plan and strategy for the future, this should not be an excuse for avoiding Brexit. Austerity, the refugee crisis and the lack of democracy still exists and countries struggle to persue their own policies.
Those that argue that we will loose our EU benefits, forget about our huge financial input. Employment rights, benefit rights and reductions in legal aid, to name just a few, can all be achieved in the UK, by a progressive Government. We also need more determined and stronger Trade Unions, which are not limited by the current legislation. We can stop printing money for the banks and to benefit the rich and we can abandon most of the reactionary legislation, such as the bedroom tax.

Changing the EU from within and with its present bureaucratic construction, in my view, would be extremely difficult. Alternatively, we should campaign for a progressive Europe against wars and oppression and for a more caring and progressive Europe with even more benefits for the many.

So lets avoid the scaremongering, the ones who want sell preservation and the gloom and doom. We can create policies that are fair for all and which continues a commitment to Europe and the rest of the world without the chaos and confusion.

Soon all this can become a reality and as a economist, I do not think we should be panicked by the corporate media or sections of the establishment, which want to retain a rigged system for their own interests; and a system which will lead to environmental disasters and more racism and predudice.

In conclusion, I believe that we need to be be clear about the EU and campaign for a progressive Government in the forthcoming General election, which can end the chaos and bring a fair society for us all.

Economics for the many!

In order to update and include some new suggestions to my previous post, I offer the following. An economic crisis or slump on the horizon is today even more difficult to predict. We have even changed the way we determine how we are in recession. Brexit and the rise of the new right complicates matters even more than usual. But the lack of growth in our economy should surely conclude that we are in recession now. I feel sure that the late John Maynard Keynes would have agreed.

As for austerity, the simple answer is that if we can create fictitious capital for banks and bonds, we can do it for infrastructure projects to boost the economy. If we can print money for the banking sector, we can print it for our essential services and end austerity. I will return to this in the future, but for now a little about inequality.

Difficult as it is to comprehend, the fact is that the six richest people on Earth now own more wealth than the bottom half of the world’s population, Further, the top 1% now have more money than the bottom 99%. Meanwhile, as the billionaires flaunt their capital, nearly one in seven people struggle to survive on less than one pound a day and horrifyingly, some 29,000 children die daily from entirely preventable causes such as diarrhoe and malaria.

At the same time, all over the world corrupt elites, oligarchs and monarchies spend billions on the most absurd extravagance. In the Middle East, which boasts five of the world’s 10 richest monarchs, young royals wiss around the globe while the region suffers from the highest youth unemployment rate in the world, and at least 29 million children are living in poverty without access to decent housing, safe water or nutritious food. Moreover, while hundreds of millions of people live in abysmal conditions, the arms merchants of the world grow increasingly rich. Our support for the Palestinian people and our humanity- support should be increased. We should promote peaceful solutions.

Not only that, but at a time of massive wealth and income inequality, people all over the world are losing their faith in democracy. They increasingly recognise that the global economy has been rigged to reward those at the top at the expense of everyone else, and they are becoming more and more angry.

Millions of people are working longer hours for lower wages than they did 40 years ago. They look on, feeling helpless in the face of a powerful few who try to buy elections, and a political and economic elite that grows wealthier, even as their own children’s future grows more bleak. The Labour and Trade Union movement should be more proactive. We should consider a citizens wage to achieve a more equal society.

In the midst of all of this economic disparity, the world is witnessing an alarming rise in authoritarianism and rightwing extremism, which feeds off, exploits and amplifies the resentments of those left behind, and amplifies the flames of ethnic and racial hostility. Time for a new anti nazi and anti racist organisation.

New and international progressive movements must commit to tackling structural inequality both between and within nations. Such movements must overcome the so called cult of money and the survival of the fittest mentalities that so many have warned against. Thatherism and the Tories austerity programme must be rejected. We surely must support national and international policies aimed at raising standards of living for poor and working-class people to achieve from full employment and a living wage to a universal higher education, healthcare and fair trade agreements. In addition, we must rein in corporate power, tax dodging and abuse and prevent the environmental destruction of our planet as a result of climate change.

We can bring about a new economic system for the many and not just the few. The Labour Party in the UK is making so much progress in this direction and we now have hope for a new anti austerity Party in Government. We can achieve this even if we are enduring a economic crisis, as we have done in the past. We should be prepared for the establishment and media bias.

Together we can achieve so much. We should campaign together now for a future with a difference for all and offer our policies for all to see in the campaign material. A new political and economic model is so essential. The task is so very urgent. September 2018

A new economic system for us all!

An economic crisis or slump on the horizon is today even more difficult to predict. We have changed the way we determine how we are in recession. Brexit and the rise of the new right complicate matters even more than usual. But the lack of growth in our economy should surely conclude that we are in recession now. I feel sure that the late John Maynard Keynes would have agreed.

As for austerity, the simple answer is that if we can create fictitious capital for banks and bonds, we can do it for infrastructure projects to boost the economy. If we can print money for the banking sector, we can print it for our essential services and end austerity. I will return to this in the future, but for now a little about inequality.

Difficult as it is to comprehend, the fact is that the six richest people on Earth now own more wealth than the bottom half of the world’s population, Further, the top 1% now have more money than the bottom 99%. Meanwhile, as the billionaires flaunt their capital, nearly one in seven people struggle to survive on less than one pound a day and and horrifyingly, some 29,000 children die daily from entirely preventable causes such as diarrhoe and malaria.

At the same time, all over the world corrupt elites, oligarchs and monarchies spend billions on the most absurd extravagance. In the Middle East, which boasts five of the world’s 10 richest monarchs, young royals wiss around the globe while the region suffers from the highest youth unemployment rate in the world, and at least 29 million children are living in poverty without access to decent housing, safe water or nutritious food. Moreover, while hundreds of millions of people live in abysmal conditions, the arms merchants of the world grow increasingly rich. Our support for the Palestinian people and our humanity- support should be increased. We should promote peaceful solutions.

Not only that, but at a time of massive wealth and income inequality, people all over the world are losing their faith in democracy. They increasingly recognise that the global economy has been rigged to reward those at the top at the expense of everyone else, and they are becoming more and more angry.

Millions of people are working longer hours for lower wages than they did 40 years ago. They look on, feeling helpless in the face of a powerful few who try to buy elections, and a political and economic elite that grows wealthier, even as their own children’s future grows more bleak. We should consider a citizens wage.

In the midst of all of this economic disparity, the world is witnessing an alarming rise in authoritarianism and rightwing extremism, which feeds off, exploits and amplifies the resentments of those left behind, and amplifies the flames of ethnic and racial hostility. Time for a new anti nazi organisation.

New and international progressive movements must commit to tackling structural inequality both between and within nations. Such movements must overcome the so called cult of money and the survival of the fittest mentalities that so many have warned against. Thatherism and the Tories austerity programme must be rejected. We surely must support national and international policies aimed at raising standards of living for poor and working-class people to achieve from full employment and a living wage to a universal higher education, healthcare and fair trade agreements. In addition, we must rein in corporate power, tax dodging and abuse and prevent the environmental destruction of our planet as a result of climate change.

We can bring about a new economic system for the many and not just the few. The Labour Party in the UK is making so much progress in this direction and we now have hope for a new anti austerity Party in Government. We can achieve this even if we are enduring a economic crisis, as we have done in the past. We should be prepared for the establishment bias.

Together we can achieve so much. We should campaign together now for a future with a difference for all and offer our policies to all to see. A new political and economic model is so essential. The task is so very urgent.

Economics in Crisis!

As someone who correctly predicted the last financial crisis, I have argued that the economics profession is indeed in crisis itself, due to its social and not science orientated stance. Even the Treasury admitted recently that economists failed to spot the build-up of risk before the 2007 slump and were guilty of what they referred to as ‘monumental collective intellectual error’.

The Bank of England’s chief economist was also right to demonstrate the challenges facing economists. Despite all this, the dominant economic model of financial liberalisation, monetary policies still dominate, together with fiscal austerity, which remains intact. And the rich get richer, whilst the poor have so often to rely on food banks.

In their defence, economists can’t be faulted for getting some forecasts wrong. Political events such as Brexit and even now General Elections are not easy to predict. Some would argue that they are instinctual or guesswork matters.

Mainstream economists, seem to lack that deep understanding of real economic reality for the many, and together with a lack of a science based model leads them into disarray.

It is an ideology based on wealth, not science, that leads economists to wrongly assert that the market in money is like a market in gold, and must not be regulated or tampered with by governments or institutions. Financial flows across borders must be free, regardless of whether they cause instability or poverty. Bankers in this system, are simply intermediaries between savers and borrowers and should not create credit out of nowhere. Monetary and fiscal policies that serve the finance sector with bailouts are however tolerable, while those that serve the poor must be resisted.

So the reasoning that informs us that the micro-economy can be utilised to reach conclusions about the macro-economy is reached. In other words, the fallacy that the budgets of households, can be aggregated and compared to the budgets of governments and institutions in the macro-economy is determined. And the fallacy of an unregulated market is often broken to suit the establishment, such as quantitative easing or the creation of fictitious capital. Modern day money trees!

Unsurprisingly, these flawed theories and models are a great comfort to financial elites and media presenters, which is why so many economists are hired and funded by big banks, corporations and the establishment. And it explains why their words and ideas are repeated, but so often lead to wrong conclusions and division. All this can be changed.

But at least the wrong conclusions, together with huge resistance recently have led in the UK, to more progressive and left policies.

Economics in Crisis!

Explosive Economics!

The continuing economic crisis, is a crisis of global capitalism and is not a European problem on its own. It is a corrupt and rigged system that many of us simply survive in. It brings with it uncertainty about inflation, prices, our lifestyle and our entire future. It often tolerates the abuse of children, the continuing exploitation of young people and the most vulnerable in our society, as well as promoting Police and Government corruption. And we now know which side the worldwide security services are on. And if you complain about any of the statutory bodies and it is overlooked, another complaint is likely to mean you are labelled as a habitual complainant. They wonder why there is a major backlash against the establishment and it’s allies!

We still have, zero hour contracts, human trafficking, slave labour- quite literally, many part employed, attacks on the most vulnerable, further austerity and many of the richest simply get richer. We now know the cuts by the Government are for right wing ideological reasons and offer no solution to this ongoing crisis. They care only for their own interests. And how many of us are, or indeed feel better off? Against this there is a tidal wave of opposition to the establishment, which threatens the very existence of the current economic and political system. This opposition needs to develop its own community orientated policies and promote a more united opposition to the toxic policies of the right; the taxdoders and those promoting racism, further bombings, wars and division.

In all this time, the economic problems have eaten more than £12 trillion in public funds. They have been at the root of practically every major political argument in this country, and it affects every aspect of the way we live our lives. Our system needs to be radically changed and much more than that, we need to search for and demand alternatives. Campaigns must become more creative to ensure that those that are disenchanted do not move to support the reactionary and often extreme right, with their miserable blame it all on migration policies. Refugees need to be supported. Who would not flee from a war torn country being bombed and pillaged? Bombing is terror!

The same financial problems that have been tracked from bank to bank, from company to company for nearly a decade, have now found there way into the very heart of our financial system, which continues in disarray, together with the Bank of England. The European Union is only part of the problem.

The next phase in this crisis could threaten our very personal way of life. We know that printing mountains of money so often ends in disaster. And unlike most of the presenters on TV and in the mainstream press, some analysts understand what’s really going on, but it is in there interests to deceive us. Together with tiny interest rates having being reduced in the UK and fictitious capital still not being spent on the infrastructure and our communities, it could well again end in another disaster and economic slump. The real bosses of our corrupt system, know all this has to change and desperately search for solutions that will enable them to hold onto their own wealth.

Economics has never been a science and the Bank of England continues to try to guess it’s way to a future strategy. So much is therefore guesswork and the guesswork of casino style economics can never be accurate. The Interest rate adjustments are based on a guess as to how to tame a system out of control. This system sows the very seeds for its own destruction, which is perhaps the only certainty.

If our precious NHS is sold off and benefits are either scrapped or reduced further, the confusion will turn into rage and even more huge campaigns.

It’s clear, our public finances are in an enormous mess. And to some extent, some politicians will admit it. But add in our financial, personal and private debt and an even darker picture emerges.

Compared to the size of our economy, Britain is now one of the most heavily indebted countries in the Western world. That’s official. Our total debts stand at more than six times of what our entire economy is worth.

Proportionally, that’s more debt than Italy, Portugal, Spain and almost twice as much debt as Greece. Those are four countries already in the throes of a financial crisis. We’re the odd one out because we haven’t collapsed as yet. But things can’t stay that way for long.

The time now is not for empathy and cosy chats, but real action, including direct action.

It’s essential we all prepare for these events. We can’t rely on mainstream commentators to help us. We need to start real debates around the country to prepare for a new and non speculative system, that is possible and in the interests of us all. The left in the Labour Party are beginning to see the necessity of having new and radical economics and the changes sweeping through the Party should be welcomed. There economic policies are similar to those that I have advocated in past blogs and are progressing. Our economics must draw upon the mistakes of the past and be based on genuine democracy and our communities.

Finally, this is not a scaremongering blog. It is simply written to enable us all to see that there are real problems and we need to find real alternatives; which we can all work towards to create a more fair and equitable society.

November 2016

Ivor Timson  MSc (Economics)

Our bed and our economy!

Interest rates due to rise? The part return of the sub-prime mortgage, the instability of the European project, China in decline, Japan continues to struggle, our own economy still not in recovery; are just some of the reasons that should concern us all. And the oil price factor is signicant as the downward pressures on prices and profits continues. Add to this the doubts about the USA economy, the wars, the chaos of the UK housing market, the buy to rent brigade, rents, the fix for the rich – political system and we all should have concerns. And we still refuse to regulate, and downsize our banks to the needs of our communities. Simplistic macro economics!

A generation of mortgage borrowers who have never seen a rate rise are in for a shock. When they can’t afford it, spending will be slashed. The slowdown could get worse and this will affect the entire economy.

The US central bank, the Federal Reserve, raised official interest rates from their post-crisis low last month, the first rise in nearly a decade. Historically, the UK tends to follow close behind. But we are so concerned about the world wide economy, that we plunder on for fears of stalling the economy any further.

And British households, with their record unsecured borrowing and sizeable mortgages, are more vulnerable to rate rises than in the past.
Households have debt worth 135% of their income according to the so called independent Bank of England.

This is well above the pre-slump norm of around 105%, and it’s creeping up again. Unsecured borrowing from credit cards to personal loans is above its pre-crisis level, at £11,700 per household, up £600, according to a recent TUC analysis.

Those who took out a mortgage since 2007 have never seen a rise in the Bank of England’s base rate. And with the average mortgage charging interest of just 3.07%, even a rise of 0.25 percentage points would hurt. It would mean the amount needed to pay interest on the typical mortgage would rise by around eight per cent.

Together with all these factors, we continue to create fictitious capital to mainly buy bad debt- bank bonds. We have failed to adequately regulate our gambling casino- stock markets and all this points to a further slump which will harm us all. Having predicted the 2007 crash I would advise – under the bed for your money again. Even as I write, the savings rate is still abysmally low.

The worldwide crash seems again to be around the corner and it will be difficult to escape for most, unless we change our economic policies and system soon. Watch this space or my posts on Facebook.

Spies, Cuts and Despair!

Desperate times, but no answers.​

The continuing crisis ​and slump​ is still not over, but at least we now see some slight improvements.​ Or do we?​

And​ at what cost, Zero hour contracts, many part employed and many of the richest simply get richer.

​The bedroom tax, the nightmare for disability claimants are just examples, to prove we are not ”all in it together”. ​

We know the cuts by the coalition are for right wing ideological reasons alone. They care only for their own interests. And how many of us are, or indeed feel better off?

​This system has made many desperate attempts to survive, but of those that stand out in the past century, it has to be quantitative easing, wars and almost zero interest rates, which have become the most desperate.​

In all this time the real​ problems​ have​ eaten more than £12 trillion in public funds. It has been at the root of practically every major political argument in this country, and it affects every aspect of the way we live our lives. In fact, you will certainly see the consequences of this deep rooted problem unfold across the cities, towns and villages of Britain. No one will escape the fallout and pensioners and those vulnerable are likely to be the most affected. Our system needs to be repaired and much more than that, we need to search for alternatives and a new system.​ And as I type, new cuts are being planned!

 The same financial problems that have been tracked from bank to bank, from company to company for more than seven years, have now found there way into the very heart of our financial system, which continues in disarray.

And many still insist that we have no alternative other than to follow the same system that has continuously failed.​ The legal system also seems in disarray, which seems to condone the illegal wars been carried out under the name of democracy. We remember previous rulings.

The next phase in this crisis could threaten our very way of life. We know that printing mountains of money can only end in disaster. And, unlike most of the presenters on TV and in the mainstream press, some analysts understand what’s really going on, but it is in ​th​eir interests to deceive us.

Together with tiny interest rates and fictitious capital it could again end in disaster. And we often forget those that save.

​But the Bankers who were partly responsible for this crisis have no answers, other than austerity.  Another desperate attempt to resolve matters. They avoid the interest rate dilemma and fictitious capital problems.​

​This is precisely why the system needs it surveillance to try to reinforce its authority, even over our mild form of democracy.​ Eric King, ​D​eputy D​irector of Privacy International, said the surveillance was ​’​the modern equivalent of the government entering someones house and reading their diary, correspondence and journals’.

​The freedom GCHQ and the NSA had to carry out surveillance was equivalent to “covert, complete, real-time physical and electronic surveillance”, he said.

​“Arbitrary powers such as these are the purview of dictatorships, not democracies,” he said. “Unrestrained, unregulated government spying of this kind is the antithesis of the rule of law and governments ​must be held accountable for their actions.”

​

If we allow​ our precious NHS to be ​completely​ sold off and benefits are scrapped, the confusion will turn into rage and huge campaigns.

Surveillance seeks to control us all,  in societies desperate push to retain their precious and often corrupt system. Spying on its citizens in both the UK and the World, attempts to transfer the power balance away from the majority to the minority- but rich elite. It seeks to frighten and control us.

​The system needs its surveillance even more as the worldwide economic system implodes. It’s clear our public finances are in an enormous mess. And to some extent, some politicians will admit it.  But add in our financial, personal and private debt and an even darker picture emerges. Our housing policies are also in disaray.

And we still hang on to 0.5 percentage interest rate, as the fear of an increase causes trepidation​, unclear signals and bungled statements from the Bank of England.

That means the most important trend of the next twenty years is almost certainly rising interest rates, as I have now argued for years.​

We’re now facing an unprecedented crisis. As interest rates rise, our record debts will become impossible to bear. And what will happen to all those that purchased on a buy to let basis?.

​And at precisely the same time, we need to fund our services such as the NHS. Only a new economic model can achieve this.​

We can’t rely on mainstream commentators to help us​ ​in even giving a fair and unbiased picture.
We need to start real debates around the country, to prepare for a new and non speculative system and this is very possible and in the interests of us all. 

​The dithering Bank of England have no answers and continue with their desperate ramblings about interest rates.​

 

And no, this is not a scaremongering blog.

It is simply written to enable us all to see that there are alternatives.

​Join us in the forthcoming campaigns around the world- we can make a difference and bring about real changes.​