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I must be stupid..


bixy
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..because on the early news this morning it was said that the revised growth forecasts for the last quarter of 2009 were likely to be lower than originally projected, and in consequence there would be a run on the pound. In fact, the forecasts were revised upwards but the pound still went down. So let me get this right: bad economic news the pound goes down; good economic news the pound goes...down. Uh? Can someone explain? And while you're about it can you explain why RSB, the bank which we mostly own, and which made a massive loss last year, is giving away £1.3 billion in bonuses to its staff, including a hundred who will each receive £1,000,000.

Hoping for enlightenment.

Patrick

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Not really mate and when you do find somebody who knows whats really going on and what will happen in the future ask him (or her) for next weeks winning lottery numbers. [:D]

P.S. Don't give the numbers to anyone else, I don't want to share the winnings. See I'm greedy just like those working in the banks. [:P]

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http://blogs.telegraph.co.uk/finance/edmundconway/100004040/dont-be-fooled-gdp-was-actually-revised-down/

explains it pretty well.

Even the BBC's correspondent has had subsequently to add a bit to her ramblings,  

http://www.bbc.co.uk/blogs/thereporters/stephanieflanders/2010/02/a_weak_and_fragile_recovery_ii.html

and as has been pointed out by another poster on her column,  to hear last night's Radio 4 Six O'Clock News one would think that the news was all good,   which clearly it isn't.

Whilst I would hesitate to call the BBC's economic coverage biased,  I certainly think they're running scared of telling it like it is.   There could of course be many reasons for this,  some less palatable than others.

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Joking aside, it's terrifying to think that we are in the hands of international money speculators, whose only motivation is greed, and overpaid morons [read bankers] who couldn't run a whelk stall, and whose only motivation is, er ...greed. Ah, I think I'm beginning to see a pattern.

Patrick

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In order to try and make sense of capital markets, bixy, it is essential to firstly comprehend one base reality: no one actually knows much of what is going on: in the main, the markets function on Lemming Syndrome.

Where one goes the rest follow!

One of the core problems, I fear, is that those institutions which are heavily exposed to a certain position thereafter issues positive statements of confidence: to do the contrary would destroy huge amounts of their value at risk.

The senior analyst at Merrill Lynch during the Dot Com ramp is perhaps an excellent exemplar: when the market was melting down, she was still pushing Dot Com stocks as a sure fire thing: in order to defend and support her advice to clients...................and vainly buck reality and keep the price up.

Markets are intensely fickle: they "price in" negative metrics and the products drops on such projections: and once the news is released (And bearing in mind, the expected bad news has already been priced in) then well, would you believe it, the gosh darn things drop again drop again!

The recent Jim Rogers furore is a good example, again: six days ago the media went into a frenzy as Rogers was reputed to have stated that Sterling was toast and "A basket case".

He has now, through his spin doc, issued a contrary statement.

http://business.timesonline.co.uk/tol/business/economics/article5555898.ece Date: 21-02-2010

Now?

http://www.pressdispensary.co.uk/releases/c992589/Imminent-Pound-Collapse-Warning-Withdrawn.php

Probably, Rogers had not gotten his short trades on Sterling all in place, yet!

[Www]

 

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Its not just GDP that influences currency values, unemployment CPI ( inflation or deflation) HPI (housing).

BOE interest rate and future exit from quantative easing program.

Things are bad in UK and will probably get worse before better.

The Budget deficit has a great impact on the value of the pound, to reduce the deficit, public spending cuts are needed, this intentionally causes more unemployment, not good, get the picture.....

Today for example the pound is falling because of the possibility of a hung parliament at the upcoming election.

The euro appears strong against the pound, but the reality is its the weak pound pushing up the euro, there is a difference, it hit 91.1 pence earlier right now just over 90.025 pence.....it is also oversold against the dollar so should rebound which will push it higher against the pound..

Expect the euro to soar when a Greek deal is done......

Thursday and friday will be US unemployment claims figures and unemployment rate..these both move currency values,if they are worse than expected then the dollar will drop which will for example push the euro higher against the pound unless there is some positive counter news from the UK.

As for RBS, get over it !!! to be successful and to protect taxpayers investment they need to pay industry levels of bonuses otherwise they will lose the very people they need to turn things around, RBS group made 8.3 billion last year so they can afford it...
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[quote user="tj"]....

Today for example the pound is falling because of the possibility of a hung parliament at the upcoming election. .[/quote]

Enough reason surely to doubt the bloody sanity of the stupid dealers and their even stupider money markets.

Destroying lives, Companies and even Countries without a second thought.

I can't be alone in thinking its time for a world-wide ban of the whole concept of making money by buying and selling money.

.

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[quote user="Bugsy"][quote user="tj"]....

Today for example the pound is falling because of the possibility of a hung parliament at the upcoming election. .[/quote]

Enough reason surely to doubt the bloody sanity of the stupid dealers and their even stupider money markets.

Destroying lives, Companies and even Countries without a second thought.

I can't be alone in thinking its time for a world-wide ban of the whole concept of making money by buying and selling money.

.

[/quote]

You need to understand, as frustrating as it maybe...these people are NOT stupid, and are the ones responsible for the UK,s boom years, this is a glitch in the system, and they are the ones who wil put it right.

I should add the blame lies wholly on government, be it UK , US or elsewhere.

But in efforts to provide a free and unregulated marketplace they messed up bigtime.

You should be calling for the scalps of the regulatory authorities........
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[quote user="tj"]ok...

why greedy? [/quote]

Greed, greediness denote an excessive, extreme desire for something, often more than one's proper share.

Greed

means avid desire for gain or wealth and is definitely uncomplimentary in implication:

[quote user="tj"]

why parasitic?[/quote]

1 : a person who exploits the hospitality of the rich and earns welcome by flattery

2 : an organism living in, with, or on another organism in parasitism

3 :

something that resembles a biological parasite in dependence on

something else for existence or support without making a useful or

adequate return

A pretty good description in my book.

.

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Like that..

But from a position of envy an understandable viewpoint..

But from another point of view, a desire to be successful in life is surely a good thing? Rather than settle for what the majority have to accept !

I cannot quantify any parasitic link though!!
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[quote user="tj"]Like that..

But from a position of envy an understandable viewpoint.. [/quote]

Absolutely NO envy on my part, I can assure you, I have pretty well everything I need or desire.

[quote user="tj"]

But from another point of view, a desire to be successful in life is

surely a good thing? [/quote]

Nothing wrong with that whatsoever.

Traders on the other hand have to live with the fact that their actions on any one day will have 'screwed' someone, somewhere.

[quote user="tj"]I cannot quantify any parasitic link though!![/quote]

Trader live and survive of the backs of others, in material terms they produce nothing.

To be successful they seek out the vunerable in the world markets and without a thought to the consequences, pounce.

Their only motive to maximise profit no matter what.

Parasites.

 

.

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[quote]Traders on the other hand have to live with the fact that their actions on any one day will have 'screwed' someone, somewhere.

.

[/quote]

Traders are "bulls" and "bears' so there is a fair balance, on a particular day one wins one loses, it is of course possible for both to win, but thats another story.

When people wish to invest in a risky businesss, they do so for potentially enormous gain, sometimes it doesnt happen......

funnily enough, the 2nd half of last year was probably the best most have ever had!

traders and investors...
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[quote user="tj"].
 You need to understand, as frustrating as it maybe...these people are NOT stupid, and are the ones responsible for the UK,s boom years, this is a glitch in the system, and they are the ones who wil put it right. I should add the blame lies wholly on government, be it UK , US or elsewhere. But in efforts to provide a free and unregulated marketplace they messed up bigtime. You should be calling for the scalps of the regulatory authorities........[/quote]

Sorry, tj!

I would totally dispute this!

The UK's "Boom Years" AKA, Brown's "Economic Miracle" was predicated only on the twin planks of insane house price rises and over-consumption of imported goods; most of it sold on crazy out-of-control consumer credit.

Imports needed warehousing, distribution and multiple retailing. Result; loads of employment - for a time - and loads of frantic activity.

Looked at Britain's Balance of Payments record recently? It's been in deficit ever since NuLab came to power; and the size of the deficit has grown and grown and grown............

By 2003, on ONS's published stats, residential house prices represented circa 66% of the Gross Value of Great Britain: that's everything; docks, airports, roads, factories, public buildings, keep on going.

No wonder there is no real capital for innovation and tech start ups!

Now in order to finance this house price explosion and since Britain has failed since the late 1950s to generate any real fresh new wealth and capital and much of core capital was exported once the Exchange Control Act of 1949 was repealed by Thatcher in 1979, to finance this "Economic Miracle" capital had to be imported via the global interbank markets, leading to what we have now, a funds overhang as detailed by such as Peston.

'Cos most of it's been repatriated: which is precisely why the B of E has had to run the electronic printing presses 24/7 with its programme of so called Quantatative Easing.

Remember the new phenomenon, called White Van Man? He was busy rushing around the M 25 et al, installing and fitting kitchens imported; conservatories imported, carpets imported, bathrooms imported etc.

And mainly on the back of re-mortgages, personal credit agreements and MEWing (Mortgage Equity Withdrawals).

And if all this wasn't bad enough, mortgage leders, enjoying an interest rate set that was the lowest in 50 years, extended all the qualifying criteria; pushing LTVs (Loans to Values) up to an insane 130%, in one case, and extending tenor (Time of mortgage) to 35 years!

No wonder there was an unsustainable house price explosion!

When examined by the Select Committe tasked with evaluating the "Independance" hah, ha, of the Bank of England, "Hard" Eddie George admitted the MPC had purposefully depressed and depressed Bank Base Rate to "Stave off an impending recession in the early years of NuLabour's government".

But they, the MPC realised they risked tripping a consumer credit explosion; and a house price boom too.

http://www.independent.co.uk/news/business/news/exgovernor-george-says-bank-deliberately-fuelled-consumer-boom-441160.html

Free and unregulated markets?

[:D]

By taking away the Bank of England's regulatory authority and giving it to a wholly incompetent FSA and in conjunction with a wholly incompetent and profligate government, none of the weapons were extant: for example, the "Corset" invoked in the early 1970s, Special Deposits could have been employed to damp down insane bank and mortgage provider lending.

The City buys and sells what already exists: it does not ever create new value: it simply adds layers of cost: as well as gambling with the little guy's investments, savings, life assurance and pensions, since 87% of fresh cash inflow comes from the institutions.

It isn't their cash they are gambling with: it's ours!

And further, by their vulture activities, they destroy value: in companies such as Cadbury, value which took over 100 years to build.

And will never ever be built again.

 

 

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Basically the biggest loser is the man in the street. These parasite comedians skim markets - only today they rigged the price of money as they knew that a UK insurance firm would need dollars to buy out an American insurance company.

The reason they love to manipulate the market frequently is because if the rates alter a few cents they can make millions.

Nothing is produced no real value is generated - just money moves into the pockets of the greedy and the poor get poorer. The traders think it's business - I think it immoral, criminal and unethical.

But hey ho they have the money and buy favour from the politicos and the proles are too concerned with scraping a living to rise up.

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[quote user="tj"]

As for RBS, get over it !!! to be successful and to protect taxpayers investment they need to pay industry levels of bonuses otherwise they will lose the very people they need to turn things around, RBS group made 8.3 billion last year so they can afford it...[/quote]

yes but the revised figures show the the people getting the 1.3 billion in bonuses contributed only 1billion to the profits. They obviously went to the Gordon Brown school of adding up

Chris

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[quote user="Gluestick"]

[quote user="tj"].
 [/quote]

Sorry, tj!

Remember the new phenomenon, called White Van Man? He was busy rushing around the M 25 et al, installing and fitting kitchens imported; conservatories imported, carpets imported, bathrooms imported etc.

And mainly on the back of re-mortgages, personal credit agreements and MEWing (Mortgage Equity Withdrawals).

And if all this wasn't bad enough, mortgage leders, enjoying an interest rate set that was the lowest in 50 years, extended all the qualifying criteria; pushing LTVs (Loans to Values) up to an insane 130%, in one case, and extending tenor (Time of mortgage) to 35 years!

No wonder there was an unsustainable house price explosion!

[/quote]

Well there is definitely an absence of specialist tradesman/homme fourgon blanc in France and suprise surprise none of the other odious things that you mention GS.

I guess not being able to pick up the phone and have someone rush round to clean your oven (just one of many needless services in the UK) is a small price to pay for a more stable economy, housing market and decent moral values.

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[quote user="Chancer"]

Well there is definitely an absence of specialist tradesman/homme fourgon blanc in France and suprise surprise none of the other odious things that you mention GS.

I guess not being able to pick up the phone and have someone rush round to clean your oven (just one of many needless services in the UK) is a small price to pay for a more stable economy, housing market and decent moral values.

[/quote]

Careful, JRC!

You'll have the equality brigade round accusing you of wearing Rose Tinted Specs!

[:D]

I do agree, however.

 

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