Quote Originally Posted by benb View Post
The world will be in a very bad state, much worse than now, if interests rates were doubled etc. The aim is to escape a deep recession (& depression) and yet encourage people to save and pay off bad debts. Its tough to get the balance without some sacrifices. If we punish the banks and people, it will only make matters worse. Its true that savers are in a way helping the people in debt, but for instance, if a company goes bust, both savers and bad debt people will suffer.

We will be doomed for a good number of years if we go into deflation, so *most* of the steps taken now are justified.

This is the time where people work harder, retrain, surviving companies optimise their business operations etc, which in the long run will benefit us all (i.e. stronger economy and currency etc).
THe low intrest rates I have heard from several sources is actually hitting the banks. many companies big and small also keep reserves which are all being hit as well by low intrest rates.

Sorry but if your being tough no nonsense trying to look long term for the country. Many people lied and took on too big a mortage, lied to get loans and credit cards. If people are let off the cycle will happen again. The UK needs to cleanse its system of bad debt and a lot of it is held by the public. These people signed agreeing to repay the debt and were aware things could go up or down surely? Many who too were trying to play the market and were "investing".

I know many took on large moratges due to thats what they needed to buy a propety, but they could have rented surely?

The country is also in a state where this summer where nearly all your purchases will be 30 percent higher. Due to the exchange rates, if you think a lot of retail operations have gone now then be prepared, for when they just cant afford to buy enough stock. Many Retail operations are going into admin so the owners can get out while the going is not to bad. Those that do carry on will in many cases buy less variety of stock and safe bets. With margin very low already how will they find any profit?

We will have stronger companies due to the sheer lack in numbers. Where will the competion come from? Many business leaders are very worried about what this means for business and for the general public. Creating new banks which can compete with the superbanks which will emerge will be very very hard.

Many of our exports come from the City and other finance companies. What will replace this with? How will the country keep the books balanced? The goverment cant have everyone working for the state surely?

Deflation is only bad if you own money and would wipe out the UK due to the incompentce that Brown has shown in the last ten years. In the good years we spent to much and didn't set aside enough for now.

My Self as a saver and with no major loans or mortages would be laughing. Many pensioners who saved and went with out to provide for their futures would be in good shape.

The only people who suffer are those who own to others. But as the goverment are the worst Inflation is now their goal to reduce the amount they owe. Which will punish all those who were sensible and careful with their money.

Sorry saving a few quid a month on tracker mortages, which is good news for good people like your self isn't really going to save the nation imo.
The goverment say your go out and spend it in the shops well possibly but only if you need it most likely it will go towards debt reduction or to savings.