Does British society live on Credit?

[Denn Forever]

I ask this because of all the credit rating ads on TV.  Credit score aps that will let you know what credit cards you can apply for. 

[Tony Baloney]

I think a good bit of Armagh does as the MOT man told me last year that he regularly fails big yokes like Range Rover, X5s etc. on bald tyres as people are in HP/PCP deals up to their eyeballs but haven't the money to maintain them.

[t_mac]

I think a good bit of Armagh does as the MOT man told me last year that he regularly fails big yokes like Range Rover, X5s etc. on bald tyres as people are in HP/PCP deals up to their eyeballs but haven't the money to maintain them.

I think its unusual to see anything at the school gate other than 4*4's in Armagh - must need them to negotiate the shambles roundabout. 

[seafoid]

Add mortgage debt
Plus the current account deficit

https://tradingeconomics.com/united-kingdom/current-account

FT comments in 2014
@notasocialist "Actually the source of this whole mess goes much deeper than party politics.  Deregulation of the financial sector (started by Thatcher in the late 1980s) has allowed the majority of our economy to become dependent on commercial bank credit.  This deliberate debt bubble creation has left us with an utter inability to pay down our debts en-mass.  As soon as any meaningful attempt is made, the economy contracts due to a shrinking of the money supply.
This debt based economic policy has continued through successive Labour, Tory and coalition governments.  Now the mathematical limits of ever-increasing debt have been reached, but none of the major parties have anything approaching an effective remedy for our economic ills."

[Milltown Row2]

I think a good bit of Armagh does as the MOT man told me last year that he regularly fails big yokes like Range Rover, X5s etc. on bald tyres as people are in HP/PCP deals up to their eyeballs but haven't the money to maintain them.

The fuel is very cheap though

[smelmoth]

I think the issue is slightly more nuanced.

The economy is too dependent upon domestic consumer demand. Consumer debt therefore feeds consumer demand and therefore growth.

Secondly you need to look at public and private debt. For the last decade the UK political discussion has become obsessed with the national debt. Not an unimportant issue but sometimes cane be fixated upon and in turn deflect attention from the key issue.

In addition to balancing the books or repaying debt a Government can disguise or deflect national debt. It can be disguised by public-private partnerships or by pushing the debt other public bodies. Thatcher and then Major went down the road of PPP. They bolstered this by one off sales (e.g. council houses). Blair/Brown put PPP into overdrive but the public appetite for PPP had eroded before Gideon Osborne got his had on the tiler. Given the austerity agenda he was able to cut the funding of local authorities but retain their statutory obligation to provide the service. These authorities run down down any cash they have and then tip over the edge into debt. We see this in the NI education system. This is real public but is not recorded as such.

In the current election campaign we see promises of capital spend. This is government taking responsibility for investment and injecting demand into the economy. These levers have been turned off for too long. Up to this point we have asked the private citizen, and very often the weakest in society, to take the risk when the broad back of the public sector should have shouldered the load and taken the funds from citizens based upon ability to pay   

[armaghniac]

UK savings are at a record low rate. Many people never save for anything, they buy stuff on credit and as soon as it is paid off they buy something else on credit.


In Ireland we have changed our ways somewhat since the boom, and not before time, but the UK just keeps on getting worse.
Yet despite having nothing in reserve they voted for the government to kibosh the economy with Brexit! You couldn't make it up. 

https://www.theguardian.com/business/2019/mar/29/uk-households-spend-above-their-income-for-longest-period-since-1980s

[Rossfan]

No point being thick and not proving it