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The Rise of the poor

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1default The Rise of the poor on January 19th 2015, 6:11 am

Darklord


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Something that has really caught my attention lately is the amount of debt that many western civilized Countries owe. I know what you're thinking, 'what's this to do with doom n gloom?' but think about it for a minute.

I'll take the good old UK as an example. The Country currently owes around £1.5 trillian ($2.27 trillion) that's not just a lot of money, that's a staggering amount of money, especially for a small island.

Here's the problem. in 2010 the Country owed approximately £750 billion. In the last 5 years this figure has doubled to the current figure. Now we can look at it in 2 ways here, either the next 5 years we're going to add another £750 billion to our debt, (making it £2.25 trillion) or are we going to double it again? (making it £3 trillion)

Who knows? but in view of recent developments in Europe with terrorism, you can bet that the current figure will definitely go up due to having to spend extra on so-called 'security'.
Notice that I say 'so-called' security. That's because no matter how much money you throw at security you can never be 100% safe. In most cases the politicians use this money for political canon fodder to attract votes. But they know that in reality it doesn't make that much difference, if a terrorist wants to come and blow up your local macdonalds or whatever? They will, and no amount of money will stop them.

OK enough about the terrorist side of things, I'm just trying to point out that Government revenue could be spent much more wisely by say bringing debt down, or increasing health care or many other things. Now lets get down to the meat of this discussion.

The UK as mentioned owes around £1.5 trillion. These figures really make no sense to the average individual, they have no concept of a billion, never mind a trillion! So let me give you an example that you may be able to relate to.

If you take every home in the UK that is owner owned, (including those on mortgage) everything from the vast stately homes right down to the one bed flats. If you added up the value of all those properties, then added to that the total of the populations private debts, (ie credit cards, overdrafts, loans etc) then you would reach a figure of approx £1.5 trillion. - That's incredible isn't it?

We now owe more money than the Government owns in assets. Yes that's right, add the value of all the property, land, investments and everything else the Government owns, and it comes to just £1.4 trillion!

What happens when we increase that amount? What happens when the foreign investors who lend the UK money, decide 'enough is enough'? The Government won't be able to borrow more money to carry on, pensions won't get paid, welfare claimants won't get paid, policemen won't get paid. The list goes on and on.

What happens then is a complete breakdown of society, where everyone (apart from the mega-rich) will look after themselves. Riots will break out, law and order will cease to exist, looting will be common place. The whole order of society will come tumbling down and all because no-one wants to see their families go hungry or without. People will be forced into this situation and all because Governments like to play around with words and behave as though there isn't a cloud in the sky.

Unless Governments come down from cloud cuckoo land? Then these risks I have outlined will become fact, it's just a matter of when? Not if.

Of course these types of incidents could happen to any Country who fails to get a grip on it's debt problem. It may not seem like it's important? But believe me it is one of the most important aspects that needs addressing in today's World.

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2default Re: The Rise of the poor on February 5th 2015, 12:51 pm

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Here is a thought that is somewhat intriguing. Money is unfortunately not real. A government prints it, says its worth something, and people believe that it is. Money is therefore the accepted currency even though it has no real value except that which the government puts on it.


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3default Re: The Rise of the poor on March 9th 2015, 5:30 am

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With a general election looming quite a few people will be undecided on who to vote for. Of course all party's will have their 'die hard' followers who will support them regardless.

But one thing that is common to all parties is the fact that they make pre-election promises to the electorate then as soon as they are in power most, if not all of these promises are either 'conveniently forgotten' or are 'watered down'.

There is one thing that any educated person who has even just the slightest interest in either politics or in how the economy is working knows for sure. That is that NO MATTER WHO manages to get elected in the future, SEVERE spending and funding cuts will have to be made in all areas. This will affect every single person in the country to some extent, and will obviously affect some, more than others.

For too long the powers that be have been spending money as though it grows on trees. Contrary to urban myth, there isn't any one single cause for this expenditure, it is an amalgamation of many different wasteage policies. As the old saying goes, 'look after the pennies and the pounds will look after themselves' (an old but true saying)

An example of this wastage is the 'guarding' of Wikileaks founder Julian Assange. The cost to the Metropolitan Police force is currently running at £10 million. This is for 'guarding' a man who hasn't even been formally arrested yet, nor even been charged! He is simply wanted for questioning.

Now while £10 million may be small fry in the grand scheme of government spending? How much equipment, how many police officers could be bought with that money? It is sheer waste plain and simple. With such a high profile celebrity like Assange, surely the police could leave the scene and would know the instance he had left the embassy? A simple matter then of arresting him and saving millions into the bargain.

Other small contribution to the debt problem is the constant legal action Government takes in order to 'defend' their decisions. Almost daily there are costly court cases where government have been taken to court because they have attempted to enforce hastily pushed through legislation which turns out to be illegal. Government and the civil service should not make errors of this magnitude. Sure mistakes can and do happen to the best of us, but not this frequently. And remember that these people are highly paid and highly experienced (supposedly) these costly court cases cost the tax payer £ billions every year.

My point is, cut out all this waste, (there's literally thousands more examples that could be given, but space restricts) before cutting people's living standards and health benefits.

Remember that whoever you vote for? Whoever gets in will at some point, have to appear like Scrooge in order to sort out the problems.

Above all REMEMBER THAT IT WILL AFFECT YOU PERSONALLY TOO!

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4default Re: The Rise of the poor on March 9th 2015, 1:17 pm

Grim

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Unfornunately, I fear this is only the beginning Recently the UK initiated a tax law through the EU which basically taxes people outside their own jurisdiction. This form of economic terrorism from the government of the UK will not be tolerated by other countries and though they may be slow to react, they will do so in good time and the reaction could include embargoes on the mighty UK from about every country on the planet including the west. The government of the UK is most definitely not representing the best interests of its people in this as there is sure to be a massive backlash.

Also, what would happen if the UK defaults on its debt? It really looks like this is where they are heading. There is an old saying "when they start charging a few pounds for a single sheet of paper they are about to go under"


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5default Re: The Rise of the poor on March 9th 2015, 5:11 pm

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The truth is that the UK will at some point have to default on it's debts. When the current coalition Government came to power 5 years ago the national debt stood at around £750 billion.
That same debt now stands at just over £1.5 trillion and is still rising.

The government brought in austerity measures and public spending cuts, they targeted welfare, care and other social areas first. This resulted in over 10,000 people losing their lives, either by taking their own, or dying because of lack of welfare. Elderly and infirm people can't get the care that they should have and deserve because the system is at breaking point.

That figure is shocking. But that figure is not plucked out of thin-air, that was the figure that the government released back in 2012. After the 'magical' figure of 10,000 was reached, the figures stopped being released so the true figure today is unknown. But the fact is that the cutbacks cost at least 10,000 innocent people their lives. There are people who are bedridden in hospitals who have their welfare stopped because they don't attend interviews! - some of these people were in comas when sanctioned. There have been people who were classed as too sick to work by their doctors, the government told them to find a job or face having no welfare, the very next day some of these people were dead, they suffered heart attacks or comitted suicide. It is not acceptable, but it happens here in Britain. (I have links to the relevent documentation to prove it)

The original idea back in 2010 when elected was to get rid of the defecit by cutting back on spending, then once the defecit was clear and showing a surplus, start to tackle the nations debt.
The fact is that the defecit did come down slightly, (around 33%) for a while, but now it is starting to rise again. Therefore there is no chance of the debt being attacked anytime soon.

Although we have austerity, welfare cuts and public spending cuts. This wasn't enough to tackle the defecit. Result? The government has started to sell the country's assets off in order to make money so that it can claim to have brought the defecit down.

Britain now has no airports that are owned by us, (major ones anyway) we have no trains owned by us nor have we any british owned power stations. There are no british owned car manufacturers, most of the major property in London is foreign owned, (including hotels and prestige stores) it has just been announced that the government is going to sell the shuttle, (underground train link/tunnel between Britain and France)

These are just the tip of the iceberg of what has been sold to foreign owners in order to 'keep our heads above water'. I have no idea what will happen once all the 'cream' of British assets have been sold and we are still no better off?

I believe the government to be witholding information from both the public and it's creditors about the real state of Britains finances. Once it gets so bad that nothing can be done, then they will start to blame the previous government, that's the usual way here. But the fact is, that it has been going downhill for over a decade and all the parties who have been in power are equally to blame.

We just can't cut anymore, the armed forces have been cut to the bone, we have troops without adequate equipment, we have an aircraft carrier without aircraft. People are being forced to work part-time because of lack of full-time jobs, we have over 1 million people who needed help from foodbanks last year and that figure is most definitely going to rise.

To outsiders, Britain sounds like some sort of paradise, believe me nothing is further from the truth. Most 'working-class' people you talk to here, when asked how they would view Britain, would either reply or agree with the statement that 'we are a third world country'.

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6default Re: The Rise of the poor on March 10th 2015, 6:12 am

Darklord


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Additionally, we have a current housing waiting list of 1.4 million, that's 1.4 million families who are forced to stay with friends, relatives etc or in emergency accomodation because of the lack of housing.
An increasing percentage of people who are not eligible for a mortgage because they either have to work part-time or are on these ghastly zero-hours contracts. These people (around 4 million in total) have to rent from private landlords because their working conditions prevent them from applying for a mortgage. This means that because they are low paid with no guarantee of a wage every week, they rely on benefits to pay their rent. In effect, the Government is paying people to go to work! - What sort of crazy system is that?

Meanwhile a high percentage of those that employ people (large employers anyway) are receiving higher and higher 'bonuses' every year on top of their salaries because of the increase in profits.
The reason their profits are increasing is mainly because they employ people on part-time or zero-hours contracts thus save money by not having to pay national insurance, holiday pay, sickness pay and redundancy pay.

Other assets that government has sold off, (in addition to my previous post) include the post office, royal mail, national grid, British steel, stately homes, the list just goes on and on. No-one from government has asked the population if they could sell these assets off, they just sell them! and they are not actually theirs to sell, they belong to the people, or at least did so.

Although this list in my last 2 posts may look bleak and full of gloom. Remember that I haven't even scratched the surface of what the Country has gone through, nor what it has sold. For instance, not many people know that the new upgrade of the A1 motorway from Wetherby to Catterick in Yorkshire is owned and operated/maintained by the Spanish. That's right, the DoT pays the spaniards a fee depending on how much traffic use that stretch of road. In return the Spanish maintain it and of course they financed the building of it.

Since the government sold off British Rail to private enterprise, (much of it foreign) travelling by rail in Britain is 4 times more costly than any other European Country for a comparable distance. (without booking in advance or other discounts) The government supply the rolling stock to these companies who then pay to lease them for a set time, but the government also subsidises every single rail journey in the UK by paying these same private companies a fee for how many passengers they carry each year. How crazy is that? More money gone, every rail journey that someone makes is being subsidised by the tax payer! No wonder we are broke.

As far as I see, the situation is not going to get any better in the forseeable future, in fact, I would say that it is impossible for the situation to get better in the forseeable future - if ever?

The time has come for ordinary folk to leave the Country and let the rich and powerful use it as their playground. I can see no hope for the ordinary people that have not only made this country, but have made sacrifices for this country - some of whom have made the ultimate sacrifice.

For those of you who have read this. Remember that the decline has now gone beyond the point of no return.
It is not possible to return to 'the good old days' and put things right.
Is this state of affairs, (which will get worse for sure) the type of place where you would want to bring your children up in the world?

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7default Re: The Rise of the poor on March 12th 2015, 12:12 pm

Grim

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The deficit for the UK is indeed shocking. The 1.5 trillion was 2 years ago though so I can only imagine what it is up to now. Funny how politicians release this figure for 3 years ago. This tells me that it is far worse than what they want to tell people. So what would happen if the UK defaults on its debt ?


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8default Re: The Rise of the poor on March 13th 2015, 4:43 am

Darklord


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Grim wrote:  So what would happen if the UK defaults on its debt ?

I don't think that that's likely, at least not in the foreseeable future as the cost of servicing the debt currently stands at around £50 billion per year which is well within the GDP of Government. (even though it is a high figure)

However if that scenario did arise? Or, as is more likely. Foreign investors started to get jittery about the amount of UK debt that they hold compared to how much or little the Country's economy was performing? Then to some extent, it would depend on which political party was in power at the time. Because they would both go about trying differing methods to correct the issue.

However, there would undoubtedly be some common factors that would affect the Country which would be inescapeable, some of which I list below. This list however is not exhaustive and many other 'smaller' issues would still affect certain people in 'major' ways.

First and foremost the UK's credit rating score would be downgraded. This would mean that those costs of servicing the debt would rise dramatically. Obviously pure guesswork, however a realistic figure would probably be a cost of around £100 billion per year for the interest payments alone.

The extra cost of servicing the debt would mean that drastic cuts would need to be made to both Government spending and services provided. The value of the Pound would drop therefore making imports, (upon which the Country relies heavily on) much more expensive. Inflation would certainly go up which would have a knock on effect of creating hardship and unease to the low paid.

The Government would have to cut back on multiple services and would need to probably have to suspend things like the free bus pass to pensioners etc. However that would only cover a small amount. Welfare for the unemployed would obviously be a target, however there wouldn't be much room to play with here as the cost of living would have risen due to the higher inflation.

Some who are more highly qualified, would probably opt to leave the Country in search of jobs elsewhere leaving a 'void' in certain professions which wouldn't be able to be filled with the unemployed, lower qualified workforce. As a result output of goods and services from the UK would drop. This would be an additional drop to the drop that would occur naturally in respect of export prices having to rise because of the drop in the value of the Pound and the increase in inflation.

House prices would also see a fall as the availability of mortgages started to shrink because of lower earnings and higher inflation. Pension funds would also take a hit with the value of many people's pensions being reduced sharply for the foreseeable future.

Ultimately, if the books could still not be balanced? Then the Government would have to resort to major cutbacks in either defence, policing or health. Or a mixture of all 3 plus some smaller services.

Whichever way it went? The difference that it would make to the average citizen, (except for the extremely well off or those who were financially independent) would be dramatic. Standards of living would plummet to below anything in living memory, the Country would be relegated in the eyes of the international community, and investments from foreign companies would dry up.

Like I said, this list is by no means exhaustive. But it does illustrate just how serious the problem is and just how gloomy things could become for the average citizen, should things take a turn for the worse.

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9default Re: The Rise of the poor on March 18th 2015, 3:17 pm

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and if they completely defaulted and decided to wipe the debt clean and not pay a penny on it ?


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10default Re: The Rise of the poor on March 20th 2015, 5:02 am

Darklord


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Grim wrote:and if they completely defaulted and decided to wipe the debt clean and not pay a penny on it ?

Like I mentioned, That scenario would not happen unless something catastrophic (like we were invaded and occupied by a foreign power) happened.

However, owing to the position of the UK as the Global Financial Capital of the World, If such a thing were to happen? It would immediately have a catastrophic effect on financial markets around the world.

Trillions of dollars would be wiped off the value of companies overnight, many global companies would go bust or at very least be left in a vulnerable position financially. Share prices would plummet and the World would see something similar to the great depression that occured in the US in the thirties.

Most of the debt this country owes is to foreign investors. These investors are typically foreign banks and pension funds and to a smaller degree large corporations.

The foreign banks would see their assets drop markedly and would probably have a run on their banks with people trying to get their money out, this in turn could lead to the banks themselves going bankrupt!

The foreign pension funds would be wiped out which would mean that their investors would receive no pension when they retired. The large global companies who hold some of the debt would take a knock as their assets would be reduced considerably which would bring their share values down ultimately making the value of the company worth much less.

Here in this country. Government would have to reduce or stop pension payments to pensioners, the National Health Service would need to be severely restricted to emergency cases only, and things like salaries for the Armed Forces, Police, Fire, Teachers, Health staff etc would need to be either stopped or severely reduced. Welfare benefits would need to be stopped with food banks and soup kitchens taking their place.

Foreign companies who have invested in the UK would pull out as there would be no profit to be made due to the financial depression. So major banks, power stations, train companies, airports and some airlines, mail services etc. would cease to exist nationally. Some would probably operate regionally, but would be small scale.

All-in-All it would be a pretty bleak picture and circumstances would be far worse in reality than I can paint with words here. This is because of the amount of investment in this country by foreign owned creditors and by foreign owned companies who have plants here in the uk. These investments would cease almost immediately! Never mind overnight.

However, there would probably be some good news for some. That would be the fact that the Royal Family and Politicians would probably get a pay rise!

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