=> The threat of rising interest rates is a Greek tragedy we must avoid
We need free market interest rates and we need them now, to clear out all of the malinvestments of the last 15 years. Yes, it will be a hard and painful time, but the sooner we stop trying to prop up unwanted businesses with artificially low credit, the sooner this Depression will end.
What will these free market interest rates be? I have no idea, because I do not possess the knowledge in my single head of six billion investors, but using an educated guess, I would reckon that this rate is currently in the 8% to 9% range, and is slowly rising with each passing month of the British government artificially holding them down with the counterfeit confetti money pouring out of the Bank of England.
I hate Fisking as much as the next man, so I'll leave you to read the article yourself (if you can be bothered), but let's just check out a single quote from the article:
Already investors are demanding higher interest rates on our national debt – heading towards a whole percentage point above the equivalent rates on German debt. If the Bank of England stops buying government bonds next year, as is expected, it believes market interest rates will rise almost another percentage point on top of that.First of all ignoring the point that it is 'our' debt, when it is in fact the British government's debt, which I totally repudiate and only pay off because the alternative is kidnap and incarceration, just look at the disingenuousness of that last line.
Either Osborne is a simpleton, and he doesn't understand that when the Bank of England buys anything, it does so with counterfeit money out of thin air, or he knows the full score of this purchasing action, which makes him a shystering snake.
Take your pick, George. I'll be generous and offer you simpleton.
But in the meantime, if you want to know what will really work, here is the plan:
1. Cut taxes in half.
2. These tax cuts are to be funded by government spending cuts, and government spending cuts only. No inflation. No borrowing.
Too bold, Sir Osborne? Then just privatise every government 'service' that there is, until you have the necessary savings. Cut all government 'aid' to overseas dictators. Get out of Iraq. Get out of Afghanistan. Limit the top government salary to £100,000 for anyone. If people don't like it, tough. They'll find no tears outside of their privileged group. Cut all MP salaries to £25,000 a year. If they don't like it, let them resign and get a proper job elsewhere, to be replaced by people who are willing to do it for this. Where they haven't been cut already, cut all other government 'worker' salaries by 10%. No exceptions. If they don't like it, let them resign and offer their job to someone unemployed who can take on the job if it's necessary (such as being a nurse), however, don't replace any Guardian non-jobbers. Appoint me as the Guardian non-job Czar. I will decide what is a proper job and what is a non-job. I will do this for FREE (and believe me, not much will get through). Cut government departments. Remove at least half of them. Just as a special bonus, Sir George, I'll give you a special £10,000 pound bonus for every billion you cut from government spending. OK, let's be super-generous. I'll offer this to every member of the Cabinet, limited to 20 places. For each Cabinet minister whose department you can axe, I'll offer each minister a £10 million pound bonus to sod off, disappear, and die of too much sex in Thailand (or whatever else takes their fancy).
All of this is possible, though I'll be happy if you just do what the Irish finance minister did. Let's take a look at what he said, again:
“Some have argued we should continue to borrow and wait for the economy to grow again before tackling the budget deficit. There are three reasons why this is not a viable proposition.Show some similar backbone, Sir Simpleton.
First, we know from the 1980s how large deficits, left unchecked, can lead to a dangerous spiral of mounting debt and ever increasing interest payments. Never again should we return to a position where all of our income taxes go to pay interest on the national debt.
Second, international debt markets have become more crowded and more fragile. If lenders were to lose faith in our ability to restore order to the public finances, the consequences for our economic well being would be profound.
Third, only decisive action will restore confidence. Consumers will only start to spend and business owners will only invest and create jobs if they believe we are tackling our deficit problem now.”
Sorry. I was confusing you there with someone with a backbone.