Tick tock

[milk monitor]

December 09

We're not nearly out of this, all the tough decisions are being put off till the election then it will be pain.

It is strange that we are running a budget deficit of 200bn (2009), the biggest challenge for the country over the next 20 years, and neither party is detailing how they are going to address the problem with elections in 5 (max) months.

This is because the scale of the butchery will be unprecedented

The government has succeeded, through borrowing and QE, in inflating another bubble. You do not get one year of pain after a 15 year boom where assets across the board treble in value. The government has taken these steps to create the illusion of a recovery before the next election. This is a huge gamble, they should have let assets prices find the floor and took the pain, by their actions there will be more pain when it comes. Spending cuts and interest rate increases (has to happen to satisfy the gilt market) will strangle the recovery

Unfortunately you will not find this information in the news. Along with other significant things like how America owes China more money than it can ever pay back, Eastern Europe is imploding and no body has a plan to tackle the UK debt of 850bn.

2010 is payback year time.

What’s also the truth is that the debt has not gone away it been transferred onto the taxpayer and still needs to be paid back.

It's propaganda that Goerballs would have been proud of.

Obviously when the next shoe falls be it Greece, Spain, Ireland or any of the Baltic states things could change things.

we still haven’t had the European riots

Last point you can’t compare that scenario to the present because we are not yet in the trough, see where the unemployment figures are then.

Boom and bust has not been eradicated, we just had the biggest boom ever and now will follow a huge bust.

the banking crisis would become a sovereign debt crisis

Greece would go bust

We live in a political system where any party who was truthful about the cuts would have no chance of being elected

The election is stopping the UK from making decisions that are already 8 months late, neither party can be honest about the cuts because they are unpopular.

But the turkeys must vote for Christmas because the other road leads to bankruptcy and even more stringent cuts imposed by the IMF.

For the winner it is a poison chalice.

a default on sovereign debt is the major event that could cause relapse