from DR just now ..."Imagine receiving this phone call: “I’m your new bank manager and I’ve been looking over your account. There’s a problem. Due to the shortcomings of my predecessor, you were mistakenly told that the amount outstanding on your loan was £100k. It is in fact £400k. Please take remedial action.”Well, that’s what the ONS (Office for National Statistics) has just told UK taxpayers. And amazingly, this ‘big news story’ isn’t being told…Run that one by me again please…Up until now, the ONS has always maintained that the UK’s debt is just under £1trn (that’s a mere one thousand billion).But this week, they’ve updated us. They now tell us that the real Government deficit is about four times larger than this! They say that the previous figure is selective and incomplete. And now they’ve decided to come clean.This is dramatic stuff. The ONS tell us that if Osborne wants to pay off the real debt, we’d be looking at tax rises of around 30%.Yes! That’s 30%...So first, what are these debts? According to The Independent, the ONS figures show:
Around a trillion in state old age pensions
Around a trillion in public sector pensions
Around a trillion in PFI & bank deposit guarantees
Around a trillion for the financial sector
These aren’t just some fudged accounting errors. These are serious liabilities that have to be honoured. PFI companies expect to get their share. Pensioners can’t be ignored… they’ll need the cash to live from.
If a business had been hiding these sorts of off-balance sheet figures, directors would be struck-off, or imprisoned...Somebody’s raided the piggybankIn many ways the last few generations have been lucky. Since the war, the standard of living has gradually increased. Education, houses, cars, retirement… we’ve had it all.These were ill-gotten gains. We’ve been living on borrowed money from future generations says the ONS.If trying to level the £1trn deficit wasn’t hard enough, how on earth are we going to settle this much, much larger claim lurking off balance sheet? The big issue is pensions. Public sector pensions are one great big Ponzi scheme and like any good Ponzi scheme, it works well for a while…The organiser (government in this case) pays the original investors dividends (pensions in this case) with fresh money from new investors (current workforce). But then you reach a tipping point. A point where you’re paying out more than you bring in.That’s where we are today. The future liabilities have been swept under the rug and now the rug’s bulging at the edges.What’s an investor to do? We’ve been discussing government’s off balance sheet finances for a while here at The Right Side and finally the debate’s reaching Main Street. By next year, the ONS has even promised us a comprehensive balance sheet for government finances based on proper accounting standards.In the meantime, I’ll keep you up-to-date on my disaster avoidance strategy. Gold, defensive stocks and emerging markets form the moat around our capital.Stay tuned for developments." ***yup..par for the course...the finances are in the same shape as immigration stats...one asian stockbroker told me this week he thinks there are 10m illegals in London alone...makes you think where our taxes have been going for years and who/what we've all been paying for...I've been highlighting these failings for years yet most UK citizens shrug their shoulders & don't want to think or admit that the system has been malfunctioning...next stop = property crash down -70% imo***
No comments:
Post a Comment