can somone economics 101 for me

[philw696]

Oh do we have to accept that things are complicated and it's not just the governments fault? It's so much simpler the other way

C

It would certainly be the Government's fault if one of the other party's were running the show

 

[GeoffCapes]

It would certainly be the Government's fault if one of the other party's were running the show

They're all as bad as each other. Always have been always will be.

At Election time you just choose who you think is the lesser of the evils. Hence why Boris got a massive majority.

 

[CatmanV2]

They're all as bad as each other. Always have been always will be.

Maybe that's because they are trying to deal with incredibly complex systems where a 'good' output is rather open to interpretation

C

 

[daverichardson]

It's simple really live beyond your means get into debt print more money write it off.
The only debt we have ever repaid was WW2 debt which happened when Ed Balls was chancer I mean Chancellor

Economics 101 credit pass

 

[williamsmix]

I've been wondering where this so called 'black hole' comes from and I think it arises as a consequence of quantitative easing (QE). Over the last 12 years the BoE has created circa £900Bn of money electronically and used it to buy Government and other bonds, to inject money into the economy and to deal with a series of crises. A lot of these bonds, particularly the GILTS will have been at **** poor coupons (interest rates) by today's standards so they're now relatively worthless, which creates a real problem as the Bank of England pulls out of QE by offering said bonds to the market (£80Bn by next September). Now the problem with this is that the Treasury - i.e. the taxpayer, me and you! - gets a bill for the difference between the par value of the bond and the market value for as long as the BoE sells them at a loss. So, I deduce that this is how the so called 'black hole' is being created. You could say it's time to pay the bills for 14 happy clappy years of low interest rates, bailing out the banks, the eurozone crisis and furlough .... But, if there are any more expert economists on here who think that I've got this wrong please do say; it may bring everyone some relief!

 

[gb-gta]

As usual it’s the financial industry playing around with numbers on a computer and gambling with it to make money for themselves. Only losers will be us, in our real asset values and, mainly, pensions taking the hit, again.

Just checked a DB pension I had from my 20’s, not paid in since late 90’s. Less than 12 months ago transfer value was over 200k, today 120k, most of that drop probably in the last month or 2. Was going to transfer it out to private, missed that boat!

 

[daverichardson]

I sort of lost 10000 on my pension funds immediately after Truss today it is recovering and I am only 5000 down i am optimistic I will recover it but it shows how reckless idiots can seriously affect personal wealth. For goodness sake the BoE were ignorant of her plans.Basic stuff really, inform the main financial institution of your proposals. I do hope Rishi settles it down for my own needs. Yes it was a laughable phase but real world is affected

 

[Wattie]

As usual it’s the financial industry playing around with numbers on a computer and gambling with it to make money for themselves. Only losers will be us, in our real asset values and, mainly, pensions taking the hit, again.

Just checked a DB pension I had from my 20’s, not paid in since late 90’s. Less than 12 months ago transfer value was over 200k, today 120k, most of that drop probably in the last month or 2. Was going to transfer it out to private, missed that boat!

I made a suggestion on another thread about pension funds and action to take…..suspect you’re not alone unfortunately.

 

[gb-gta]

I made a suggestion on another thread about pension funds and action to take…..suspect you’re not alone unfortunately.

I don’t think I saw that….

To be honest, it’s my own fault really, I should have moved it last year or earlier this year. has been pretty obvious for a long long time that interest rates were going to rise from these long term historic lows, no doubt kept low to encourage consumer splurging propped up by seemingly never ending cheap finance.

Rising base rates were always going to affect the gilts and therefore the pension transfer values, but it just happened very quickly, although the trend has been there for a while.

Like the pension people said, if you plan on just taking your pension as normal the transfer value is irrelevant. Bit like your house value doesn’t matter if you never sell it, but in my case a £207k transfer value with a £6k/year pension, albeit index linked, I thought was a no brainier to move out of a DB into my control in a safe, low risk private one. I would have to live to 100 to make the DB pension make sense! Although I guess it’s more complicated than that basic maths.

I think the take away from this is keep a close eye on your pensions, take good advice and watch the direction the world and politics seem to be heading. Of course it’s a gamble, covid and war is tricky to predict, but most people, me included, are too blasé about their pensions and just leave them without even checking them. As you say there will be huge amounts of people whose transfer values have dropped 30-40% obviously, they may never know, and not be bothered anyway, if they were just going to take the annual income at retirement anyway.

 

[Swedish Paul]

I don’t think I saw that….

To be honest, it’s my own fault really, I should have moved it last year or earlier this year. has been pretty obvious for a long long time that interest rates were going to rise from these long term historic lows, no doubt kept low to encourage consumer splurging propped up by seemingly never ending cheap finance.

Rising base rates were always going to affect the gilts and therefore the pension transfer values, but it just happened very quickly, although the trend has been there for a while.

Like the pension people said, if you plan on just taking your pension as normal the transfer value is irrelevant. Bit like your house value doesn’t matter if you never sell it, but in my case a £207k transfer value with a £6k/year pension, albeit index linked, I thought was a no brainier to move out of a DB into my control in a safe, low risk private one. I would have to live to 100 to make the DB pension make sense! Although I guess it’s more complicated than that basic maths.

I think the take away from this is keep a close eye on your pensions, take good advice and watch the direction the world and politics seem to be heading. Of course it’s a gamble, covid and war is tricky to predict, but most people, me included, are too blasé about their pensions and just leave them without even checking them. As you say there will be huge amounts of people whose transfer values have dropped 30-40% obviously, they may never know, and not be bothered anyway, if they were just going to take the annual income at retirement anyway.

It really depends how close you are to retirement. A long way away, it neutralizes. Close, delay a couple of years, it neutralizes