UK Economic Response to Coronavirus
UK Economic Response to Coronavirus
Well, today has seen a rather surprising and amazing economic response to the Coronavirus pandemic.
The long and the short of it (and no, this is not detailed), all furloughed employees will have 80% of their salary paid by central government by way of HMRC grants to the employers. If I were to use my personal circumstance as a barometer, this means the Government will pay 80% of my salary from 01/04/20 until I (hopefully) return to work in September. I haven't even begun to do the maths yet, but that was one hell of a fillip to the British economy and allayed the fears of countless millions of people who have been worrying about paying their mortgages and bills etc.
This is not in the least a political post. It's just an informative post, and a little bit of relief on my part. I think it is best to say that a large number of the UK population is in stunned disbelief right now, trying to understand what exactly has just happened.
In other news, effective close of business tonight, UK cafes, bars, pubs, restaurants, clubs, theatres and cinemas have been closed. (Takeaways and deliveries excepted.)
The long and the short of it (and no, this is not detailed), all furloughed employees will have 80% of their salary paid by central government by way of HMRC grants to the employers. If I were to use my personal circumstance as a barometer, this means the Government will pay 80% of my salary from 01/04/20 until I (hopefully) return to work in September. I haven't even begun to do the maths yet, but that was one hell of a fillip to the British economy and allayed the fears of countless millions of people who have been worrying about paying their mortgages and bills etc.
This is not in the least a political post. It's just an informative post, and a little bit of relief on my part. I think it is best to say that a large number of the UK population is in stunned disbelief right now, trying to understand what exactly has just happened.
In other news, effective close of business tonight, UK cafes, bars, pubs, restaurants, clubs, theatres and cinemas have been closed. (Takeaways and deliveries excepted.)
UK Update
As I'm back in Blighty by a cruel twist of fate, I'll post a few updates here of things going down in merry old England (London)
Pubs etc all must close today...
"All cafes, pubs, bars, clubs, restaurants, gyms, leisure centres, nightclubs, theatres and cinemas must close tonight, Boris Johnson announced as the government brought in stronger measures to enforce social distancing."
No great surprise there and about time.
What is a surprise is the length the government said it will go to keep people in money!
"The chancellor, Rishi Sunak, announced the government would for the first time step in and pay people’s wages as he launched an unprecedented economic rescue plan."
"The government will cover 80% of the salaries of retained workers, up to £2,500 per month, and defer the next quarter of VAT payments due from businesses. He also outlined £6bn of extra support for the welfare system".
I cannot begin to work out what that will cost but I do know two things:
1: it will run into many tens of billions and;
2. The government hasn't actually got any money!
The UK has no sovereign wealth fund. It does have a £2Trillion national debt and that looks like it is going to go nearer to £3 Trillion by the time this is over with mind boggling numbers in new outgoings and a collapse of tax receipts. Ball park figures are about £700 Billion spending with £640 Billion in tax receipts, so already borrowing £60 Billion. With collapsing tax receipt it's not difficult so see a budget deficit of £200 Billion by this time next year.
This is all about stopping a complete collapse of an economy and civil disturbance. Thankfully all of the world is doing the same so we may not be the most knackered horse on the way to the glue factory. Hopefully.
https://www.theguardian.com/politics/li ... ools-close
Pubs etc all must close today...
"All cafes, pubs, bars, clubs, restaurants, gyms, leisure centres, nightclubs, theatres and cinemas must close tonight, Boris Johnson announced as the government brought in stronger measures to enforce social distancing."
No great surprise there and about time.
What is a surprise is the length the government said it will go to keep people in money!
"The chancellor, Rishi Sunak, announced the government would for the first time step in and pay people’s wages as he launched an unprecedented economic rescue plan."
"The government will cover 80% of the salaries of retained workers, up to £2,500 per month, and defer the next quarter of VAT payments due from businesses. He also outlined £6bn of extra support for the welfare system".
I cannot begin to work out what that will cost but I do know two things:
1: it will run into many tens of billions and;
2. The government hasn't actually got any money!
The UK has no sovereign wealth fund. It does have a £2Trillion national debt and that looks like it is going to go nearer to £3 Trillion by the time this is over with mind boggling numbers in new outgoings and a collapse of tax receipts. Ball park figures are about £700 Billion spending with £640 Billion in tax receipts, so already borrowing £60 Billion. With collapsing tax receipt it's not difficult so see a budget deficit of £200 Billion by this time next year.
This is all about stopping a complete collapse of an economy and civil disturbance. Thankfully all of the world is doing the same so we may not be the most knackered horse on the way to the glue factory. Hopefully.
https://www.theguardian.com/politics/li ... ools-close
Re: UK Update
I don't think anyone is thinking about nor caring about the long term effects on the economy right now. The key is to somehow keep the economy afloat and not allow a terrible, unprecedented event turn into the apocalypse.
The virus is one thing, but once the economy starts to collapse, we may as well say goodbye to civilization as we know it. That might sound like scaremongering, but it's a possibility if things aren't managed properly. You only have to look at countries like Venezuela to see what happens when economies completely break down. First you have hyper-inflation, meaning all that money you've spent your life saving up is pretty much worthless. Then comes the food shortages, followed by a complete breakdown in law and order.
If the only way to avoid that is to borrow, borrow and borrow some more and worry about it later when this has all died down, I'm all for it.
The virus is one thing, but once the economy starts to collapse, we may as well say goodbye to civilization as we know it. That might sound like scaremongering, but it's a possibility if things aren't managed properly. You only have to look at countries like Venezuela to see what happens when economies completely break down. First you have hyper-inflation, meaning all that money you've spent your life saving up is pretty much worthless. Then comes the food shortages, followed by a complete breakdown in law and order.
If the only way to avoid that is to borrow, borrow and borrow some more and worry about it later when this has all died down, I'm all for it.
The difference between animals and humans is that animals would never allow the dumb ones to lead the pack.
Re: UK Economic Response to Coronavirus
That magic money tree that Theresa May said didn't exist seems to have grown fast.
The difference between animals and humans is that animals would never allow the dumb ones to lead the pack.
Re: UK Update
I'm pretty dumb on these things but when countries talk of borrowing money, who or what is it borrowed from?
I'm standing up, so I must be straight.
What's a poor man do when the blues keep following him around.(Smoking Dynamite)
What's a poor man do when the blues keep following him around.(Smoking Dynamite)
Re: UK Update
Can we merge this thread with the one I started earlier?
Nonetheless, I'm with @xandreu on this one.
Scaremongering also includes the misinformed. This will all have to be paid for, and I don't thing there is a single idiot that doesn't realise this. The trillions of debt are going to have to be paid back. @Doc67 , you can prevaricate to your heart's content. The Govt made it clear that this is a precautionary measure to avoid meltdown and financial meltdown. And that (one day) we all have to pay it back.
Nonetheless, I'm with @xandreu on this one.
Scaremongering also includes the misinformed. This will all have to be paid for, and I don't thing there is a single idiot that doesn't realise this. The trillions of debt are going to have to be paid back. @Doc67 , you can prevaricate to your heart's content. The Govt made it clear that this is a precautionary measure to avoid meltdown and financial meltdown. And that (one day) we all have to pay it back.
Re: UK Update
Countries borrow from countries, in it's most simplistic terms. In this example, we've probably borrowed from USA against our future FTA with USA, and there will be tax breaks and trade agreement incentives that will balance it all out. I don't know for sure, but the fact the £ has rallied against the $ is usually a good indicator!!
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Duncan
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Re: UK Update
They dont borrow from anyone. Governments print their own money in bad times and take it out of circulation in the good times.
Cambodia,,,, Don't fall in love with her.
Like the spoilt child she is, she will not be happy till she destroys herself from within and breaks your heart.
Like the spoilt child she is, she will not be happy till she destroys herself from within and breaks your heart.
Re: UK Update
Boris is spending the money he had stashed to mitigate the effects of brexit and then some. Don't see why we should all have to pay it back. i am a pensioner. he is giving me buck shit and that includes medical ttreatment which will be reserved for thos most likely to survive, and Boris and the rest of the welathy Eton boys who have private medical and havent done a days work in their livesYerg wrote: ↑Sat Mar 21, 2020 3:38 am Can we merge this thread with the one I started earlier?
Nonetheless, I'm with @xandreu on this one.
Scaremongering also includes the misinformed. This will all have to be paid for, and I don't thing there is a single idiot that doesn't realise this. The trillions of debt are going to have to be paid back. @Doc67 , you can prevaricate to your heart's content. The Govt made it clear that this is a precautionary measure to avoid meltdown and financial meltdown. And that (one day) we all have to pay it back.
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