Trade wars - how will it effect the UK?

Claremont

WelwynWitch3

Vote Labour and this is what you get, a PM that needs a voice coach and a Chancellor that can’t add up, oh dear!

Oh dear, of course we've just had 14 years of a Government full of amazingly capable people- who helped the country rise and rise and become so so wealthy and successful.

Mrs Thatcher certainly had voice coaching- she used to have a highly pitched squeeky voice. Even George the VI had voice coaching. Why not?

Even George the VI had voice coaching. Why not?

Thst's not very fair, Claremont!
King George VI had a terrible stammer and felt embarrassed having to meet the public and give speeches.
It was nothing to do with vanity.

WelwynWitch3

Vote Labour and this is what you get, a PM that needs a voice coach and a Chancellor that can’t add up, oh dear!

Oh dear, of course we've just had 14 years of a Government full of amazingly capable people- who helped the country rise and rise and become so so wealthy and successful.

Mrs Thatcher certainly had voice coaching- she used to have a highly pitched squeeky voice. Even George the VI had voice coaching. Why not?

David49

MaizieD

if the GDP was stronger we wouldn’t have to use QE

How do you work that one out, David?

If the pound were stronger we'd be exporting even less because our goods would be too expensive...

We don’t actually produce many goods for export, in any case they don’t have to be cheaper if they are better they will sell
Stronger sterling would reduce import cost, which is even more important

However, the UK does have a trade surplus with the US, boosted by financial and other services. Tariffs would hit the UK's export revenue.

Vote Labour and this is what you get, a PM that needs a voice coach and a Chancellor that can’t add up, oh dear!

MaizieD

^if the GDP was stronger we wouldn’t have to use QE^

How do you work that one out, David?

If the pound were stronger we'd be exporting even less because our goods would be too expensive...

We don’t actually produce many goods for export, in any case they don’t have to be cheaper if they are better they will sell
Stronger sterling would reduce import cost, which is even more important

if the GDP was stronger we wouldn’t have to use QE

How do you work that one out, David?

If the pound were stronger we'd be exporting even less because our goods would be too expensive...

Barleyfields

The profit is existing money David, not new money. New to the business which has made the profit of course, but not new to the economy. Why do you say that creating more money to expand the economy hasn’t happened for 20 years? Where do you think the furlough money, for instance, came from?

Furlough came from mostly QE it was emergency funding, that’s fine, it happened after the 2008 crash as well.
if the GDP was stronger we wouldn’t have to use QE, if we weren't importing £30bn more than we export we wouldn’t need to use QE, certainly not for everyday spending.

The profit is existing money David, not new money. New to the business which has made the profit of course, but not new to the economy. Why do you say that creating more money to expand the economy hasn’t happened for 20 years? Where do you think the furlough money, for instance, came from?

MaizieD

^The extra money in circulation has come from economic activity, increased GDP if you like plus borrowing/creation^

I suggest you are confused, David
Economic activity can only take place with money that is already in existence. You could argue that money created by the commercial banks for loans is new money, but loans have to be repaid, and once they are repaid the money no longer exists. What is more, the interest paid on the loans is just more money leaving the economy and ending up in the hands of the wealthy in the form of bonus and excessively high pay.

Increased GDP has nothing to do with new money entering the economy, it's just a measure of economic activity.

Borrowing? Well, borrowing from the wealthy domestic population , which the greater part of the 'investors' in government bonds are, is just taking back money which has already been issued into the economy.

Which leaves 'creation'. Which is the source of all that money...

Yes, money can be borrowed and interest paid a business will employ others, sell a product and make a profit that is where money is created.
The profit is used to expand the business, more is borrowed and the cycle happens again, only when a business consolidates does taxation really matter because you are reinvesting for expansion. We have seen with Bezos he has boasted he pays very little tax because he keeps expanding, now he is spending his billions on Blue Horizon space program.

I dont have a problem with creating/borrowing more money to expand the economy, that hasnt happened for 20 yrs. One of the other drags on the economy is the trade balance over the last 20yrs, most of that time imports have cost 30billion every year more than exports

Of course the truly wealthy escape IHT Maizie. They can use devices such as trusts which are of no use to those whose wealth lies in the home they live in and the savings they need to dip into. More and more ordinary people’s estates are becoming subject to IHT as house prices rise but the IHT threshold remains unchanged.

Barleyfields

Don’t you want to hand your wealth to the next generation David, and minimise the IHT due on your estate?

Yes of course, but that does not help the economy, what the wealthy are doing works against the economy

The extra money in circulation has come from economic activity, increased GDP if you like plus borrowing/creation

I suggest you are confused, David
Economic activity can only take place with money that is already in existence. You could argue that money created by the commercial banks for loans is new money, but loans have to be repaid, and once they are repaid the money no longer exists. What is more, the interest paid on the loans is just more money leaving the economy and ending up in the hands of the wealthy in the form of bonus and excessively high pay.

Increased GDP has nothing to do with new money entering the economy, it's just a measure of economic activity.

Borrowing? Well, borrowing from the wealthy domestic population , which the greater part of the 'investors' in government bonds are, is just taking back money which has already been issued into the economy.

Which leaves 'creation'. Which is the source of all that money...

Barleyfields

Don’t you want to hand your wealth to the next generation David, and minimise the IHT due on your estate?

The people who are being caught for IHT are the 'little people'. The truly wealthy are escaping it altogether.

I suggest you watch the documentary petra posted about. On Netflix or youtube.

One of the reasons for our ever increasing inequality is inheritance. Read the economist Thomas Pikety. He wrote the seminal text on inequality, 'Capital in the 21st century'. pub 2011.

Do you really want a country in which the rich become richer and the poor become poorer because the rich have sucked up and hoarded the money which should be circulating, contributing to growth and improving the wellbeing of all citizens?

I'd also suggest that one of the reasons that the government has to issue more and more money is that the wealthy grab it and squirrel it away, leaving less for everyone else...

Barleyfields

Don’t you want to hand your wealth to the next generation David, and minimise the IHT due on your estate?

No, I'm going to spend, spend, spend!

😁

Don’t you want to hand your wealth to the next generation David, and minimise the IHT due on your estate?

“the money in the economy is captured and squirrelled away by the wealthy.”

This is exactly what is happening in the UK those with wealth are not investing it in national growth it’s being invested or gifted perpetuating the family wealth. The tax allowances are far too generous, those with wealth should be funding their own pensions and health care, yes , it’s a 2 tier system but it’s a lot fairer than we have today.

I don’t expect many householders on GN to agree, most just want to hand their wealth to the next generation without any tax.

Dickens

petra

If anyone is seriously interested in how the whole money system works watch The Spiders Web ( Britains second empire) on Netflix.

Thanks for the heads up - I will look at that!

My thanks, too, petra. A documentary everyone should watch..

For the benighted few (like me) who don't subscribe to Netflix, it’s also available, free, on YouTube.

m.youtube.com/watch?v=np_ylvc8Zj8

It’s not the money system I’m talking about, I’m talking about where the nation’s money originates and how it gets into the national economy. This film is about what happens when the money in the economy is captured and squirrelled away by the wealthy.

I should point out that Richard Murphy, who I get sneered at for mentioning, was a cofounder of the Tax Justice Network which features prominently in the documentary.

The extra money in circulation has come from economic activity, increased GDP if you like plus borrowing/creation
In 2002 borrowing was 29%, public spending was just over 30% of GDP.
Today borrowing is nearly 100% of GDP, public spending is now nearly 45% of GDP, that increase has been funded by borrowing/creation. Proposing more printing money risks the situation Japan has suffered their borrowing is 260% of GDP and the currency collapsed.

I agree with Labour policy to increase GDP, there is plenty of wealth in the UK, taxation could increase to fund that, my doubts are that they will have the courage to do that.

petra

If anyone is seriously interested in how the whole money system works watch The Spiders Web ( Britains second empire) on Netflix.

Thanks for the heads up - I will look at that!

Chump doesn't much care that his previous imposition of tariffs in term #1 raised costs for his own people by several hundred dollars a year, or even a few thousand, depending on their buying habits. Not that he WOULD care, his natural arrogance means he is disconnected from real people, except when getting MAGA hats made in China for his imbecilic fans to wear.

Maybe his voters never heard that his previous attempts to attack China meant they stopped buying Soy Beans, and the US Govt had to pay massive compensation to the affected farmers, genius use of the taxpayer dollar (not that Chump is affected -- records show he doesn't pay any).

His whole spiel about "Make America Great Again" is just that, a sales pitch, from an expert conman and hypocrite.

Anyone in doubt should check out that hilarious video, from about 2015 (? -- UTube now), Chump on the Letterman show, talking about his "Luuuuurrrrrvvve" for American workers, then DL got out some ties and shirts from under the desk, part of Chump's exec clothing range, and when the orange sex pest said he "couldn't remember" where they were made, DL said "let's look at the labels", "Oh, Bangladesh", then "this one's Taiwan - lovely ties . . ." etc etc. Collapse of bumptious braggart balloon as it meets expert comedy pin, on TV.

Oh, and his attacks on all those terrible immigrants? His winery business was caught applying for MORE Mexicans to work there . . .

Did someone say he's not looking well? Indeed, must take ages for someone to paint him that strange colour every morning. Somehow I doubt it's Melania . . .

Since many products passing between the USA and EU are similar (like cars, car parts, pharmaceuticals) what would be the point in a tariff war? Where is Trumps leverage, except in money for NATO.

Inpropose the increase in earnings has come from inflation and the need to buy the essentials of life, money supply has had to increase to achieve that.

Fine.

Now, where did the extra money come from, David?

It looks like we here in the UK will be the lucky ones where tariffs are concerned from what DT said the other day, but the EU not so lucky.Or will it all be a bluff?

Did he convince anybody else though petra? He looks like a failed bully from the outsider’s perspective, and it’s an early warning system for countries to look to other markets in future rather than the US. Own goal, I would suggest.

I don’t think Trump had any intention of raising tariffs.
He had to convince the voters that he was going to make America great again raising tariffs. Knowing full well he had no intention of following through.
But maybe not with the eu. That’s personal with him. He had a real problem with Angela Merkel.