IMF - The UK can afford to live with a high debt forever
http://www.telegraph.co.uk/finance/economics/11644471/Britain-can-afford-to-live-with-high-debt-forever-says-IMF.html
They have stated that cutting the debt could actually do more harm than good to our economy. This seems to be a complete face turn from their calls for austerity.
They have stated that cutting the debt could actually do more harm than good to our economy. This seems to be a complete face turn from their calls for austerity.
0
Comments
What do they say about Greece?
Oh look
http://www.theguardian.com/business/2015/jun/02/greek-debt-talks-bailout-imf-merkel-g7-summit
Their point is that it depends on the country. As we can create our own currency we are better off than countries in the Euro.
It all comes down to whether you believe the IMF are talking rational economic sense or not.
Well, it only works if we can keep our bond rates at 2%, imagine if we had another economic shock and our bond rates went to the more normal 5% or even 10%.
Those £50bn interest payments are then on their way to becoming £100-£150bn, we are then talking about the end of the NHS.
Call me old fashioned, but I think that is a risk too big to be worth taking.
Page 1 disclaimer of the report.
/thread closed
So what? It's still the view of some leading economists at the IMF…
Jonathan D. Ostry – Deputy Director of the Research Department (RES) at the International Monetary Fund.
Atish Rex Ghosh – Assistant Director, and Chief, Systemic Issues Division, in the Research Department of the International Monetary Fund.
Raphael Espinoza – Economist in the Research Department (Systemic Issues Division) at the IMF.
But hey, guess what, this particular economic expert would care to disagree with them…
David Tee, CSE Woodwork (Planks), from the DS Politics Forum
Thanks for the insult. FWIW it's worth I'm the last person you should ever employ to do any woodwork. I don't pretend to be an expert (and I'm most certainly not) - but unlike you at least I have the nous to read something when it's put in front of me.
Your attempt at ignoring the one and only disclaimer in the report (so important it's pretty much the first thing they say) - which clearly states that the report should not be attributed to the IMF - is risible.
Why? Because the world is full of economists that disagree. For every one that says one thing, you can find another that says the polar opposite. But that's not the story here, is it? The story is that "Britain can afford to live with high debt 'forever', says IMF"
Only they don't. And it's not even a formal paper your blessed economists have written, it's a discussion note.
I never sought to ignore the disclaimer (obvious straw man alert), merely to point out that the ‘note’ is still the work of leading economists – not armchair ones like you or me.
And if you want to blame someone for the misinterpretation, I suggest you write to your beloved Telegraph.
Of course you ignored the disclaimer - you charged headfirst into pitting me against three leading economists by saying I disagreed with them. Which was news to me because I did no such thing. I simply pointed out that the report was emphatically and categorically NOT the views of the IMF, the primary thrust of the story.
What strawman btw?
That is exactly what has happened in Japan.
"Notes are published to elicit comments and to further debate."
Thread reopened.
Fair enough. However, I didn't appreciate the nature of your first post, which IMHO sought to both belittle the OP and shut down discussion on the topic.
It stands to reason that some percentage - maybe a majority - of all leading economists everywhere at all times must be completely and utterly wrong about everything.
Finding an economist to justify what you personally think is quite easy. They have the whole spectrum covered! No different to saying that an MP utterance represents UK Parliament view. Free to say whatever they want but it a personal view not that of the institution.
Not when they appear to be stating the bleeding obvious, however: that a country can continue with a certain level of public debt without necessarily ever running into difficulties servicing it – something that most major economies have been doing for decades.
So you responded by both misrepresenting what I said and making disparaging comments. And you want to pull me up for belittling people...
I made no comment (you really need to read these things properly) about anything the OP said - so quite how you formed your HO I have no idea. I simply reposted what the disclaimer said, from which any fule could then work out that these were not the views of the IMF. I also posted it as a joke (first line in case you didn't read that bit either). I found it funny - still do - that something could be so obviously distorted.
In case you're curious - it always pays to read IMF documents. This is an organisation that rarely sings from the same hymn book. Half of them say one thing, the other say something else entirely. Lagarde appears to have final say on the matter and on this issue, it's probably worth waiting to see if she has any comment.
OK, I'll suggest to my brother that he reduces his food consumption to starvation levels so he can use that money to pay off his loan more quickly. That's what you're suggesting the country do, right?
Now THAT'S a Strawman....
http://www.independent.co.uk/news/uk/politics/revealed-how-the-city-bankrolls-tory-party-2208668.html
and David Cameron has stated The age of austerity is not just a passing phase and Britain should get used to having a ‘permanently’ smaller state
http://www.dailymail.co.uk/news/article-2501697/Cameron-Austerity-Britain-used-leaner-efficient-state.html
it is not surprising that this austerity narrative keeps getting pushed. It is ideological.
Borrowing money to finance capital projects is "good debt"
This is because the return on the investment project is greater that the cost of borrowing money
Borrowing money to pay for day to day expenses is "bad debt"
This is because you are spending money that you cannot afford.
Using debt to pay benefits for example, is like taking out money on your credit card to buy food