UK loses top AAA credit rating
![]() British Economy: What solution? Import another 100-Lakshmi Mittals+Ratan Tatas..
|
he combined debt of the UK economy – State, Corporate and household debt is at a staggering 500% of the GDP. This is the debt that the UK economy has to support. Assuming weighted average interest rates on this debt is at a low 5%, it means that the UK economy is spending 25% of its production on interest payments.
Since the savings rate of the UK is low-to-negative, it means that the UK economy will borrow more – just to make interest payments.
What could be a solution?
Massive inflation to get this debt down quickly.
Or slowly ratchet down the debt, and write-offs, low-inflation, and desperate prayers that the economy:
- Hits another North Sea oil
- Builds another 1000 ARM-chips kinds of company
- Imports another 100-Lakshmi Mittals+Ratan Tatas.
How likely is any of this?
The UK has lost its top AAA credit rating for the first time since 1978 on expectations that growth will “remain sluggish over the next few years”.
The ratings agency Moody’s became the first to cut the UK from its highest rating, to Aa1.
Moody’s said that the government’s debt reduction programme faced significant “challenges” ahead.
The UK has had a top AAA credit rating since 1978 from both Moody’s and S&P.It added that the UK’s huge debts were unlikely to reverse until 2016.The UK’s net sovereign debt was the equivalent of 68% of the country’s annual economic output, or GDP, at the end of last year.All three major credit agencies last year put the UK on “negative outlook”, meaning they could downgrade its rating if performance deteriorates.Germany and Canada are the only major economies to currently have a top AAA rating – as much of the world has been shaken by the financial crisis of 2008 and its subsequent debt crises.
via BBC News – UK loses top AAA credit rating for first time since 1978.
Leave a Reply Cancel reply
Intrigued? Interested!
The 2ndlook blogs group try to give its readers a 360° view of the past present and probable outcomes. These four blogs have each a different focus. The common value that runs through these blogs is an invite to readers for discussion and participation - with a proviso of no personal attacks or use of invective.
2ndlookWith a focus on history, long-term trends, economy, political and social models. A blog that works to breakdown propaganda for what it is. The first blog of the group, over the four years of its existence, it has managed a monthly traffic of more than 10,000 hits. |
Behind 2ndlookThis forum is a visual record of the times. Historical prints to current cartoons, this is the latest in 2ndlook group of blogs. |
St.PT BarnumA forum that takes a lighter or satirical view of weighty matters. Posts on this forum are rare. |
![]() QuicktakeQuicktake focusses more on current events, recent events, reports, media buzz, matters of topical interests. Typically, Quicktakes are shorter than 2ndlook. Sometimes a few Quicktakes, morph into a 2ndlook post. |
Get Quicktake by email
Quicktake on Twitter
- RT @MandhBudhhi: @ReviewVayu Hehehe! All these platforms have been in production for donkey's years! Just see the delays in the #F35, new h… 2 hours ago
- RT @MandhBudhhi: @ReviewVayu Is this also on a tangent? Your predilection for #GoraPujan is becoming rather obvious. Sadly! https://t.co/2v… 2 hours ago
Top Vote getters
2ndlook on Indus Valley-Saraswati Basin
Exciting new series. From 1 Mar, 2010.
10 posts. More than 50 photographs. 100 links to the best original sources and writers. Get a 2ndlook at the 'Indus Valley Civilization' research. On military, defence, currency, travel, political systems. Cutting edge discoveries. With research from more than 200 news items, journals and books. Without the politics, with insight.
Recent Posts
Categories
Archives
- April 2014 (1)
- November 2013 (1)
- September 2013 (1)
- July 2013 (1)
- June 2013 (2)
- May 2013 (5)
- April 2013 (17)
- March 2013 (6)
- February 2013 (10)
- January 2013 (10)
- December 2012 (9)
- November 2012 (14)
- October 2012 (11)
- September 2012 (10)
- August 2012 (13)
- July 2012 (12)
- June 2012 (23)
- May 2012 (10)
- April 2012 (12)
- March 2012 (9)
- February 2012 (15)
- January 2012 (10)
- December 2011 (15)
- November 2011 (19)
- October 2011 (24)
- September 2011 (15)
- August 2011 (4)
- July 2011 (4)
- June 2011 (18)
- May 2011 (15)
- March 2011 (8)
- February 2011 (6)
- January 2011 (2)
- December 2010 (10)
- November 2010 (16)
- October 2010 (7)
- September 2010 (18)
- August 2010 (15)
- July 2010 (15)
- June 2010 (10)
- May 2010 (11)
- April 2010 (26)
- March 2010 (14)
- February 2010 (6)
- January 2010 (8)
- December 2009 (29)
- November 2009 (21)
- September 2009 (11)
- August 2009 (34)
- July 2009 (14)
- June 2009 (9)
- May 2009 (25)
- April 2009 (15)
- March 2009 (33)
- February 2009 (19)
- January 2009 (33)
- December 2008 (29)
- November 2008 (72)
- October 2008 (90)
- September 2008 (18)
- March 2008 (6)
- February 2008 (17)
Top Rated
2ndlook on Twitter
- RT @MandhBudhhi: @ReviewVayu Hehehe! All these platforms have been in production for donkey's years! Just see the delays in the #F35, new h… 2 hours ago
- RT @MandhBudhhi: @ReviewVayu Is this also on a tangent? Your predilection for #GoraPujan is becoming rather obvious. Sadly! https://t.co/2v… 2 hours ago
Your way of telling all in this paragraph is truly nice, all can effortlessly know it, Thanks
a lot.