GREAT WAY TO RUN THINGS

[Syd]

WHAT A GREAT WAY TO RUN THINGS - BRILLIANT

 

Government Strategy

 

It is the month of August; a resort town sits next to the shores of a lake. It is raining, and the little town looks totally deserted.

Times are tough, everybody is in debt, and everybody lives on credit.

 

Suddenly, a rich tourist comes to town.

 

He enters the only hotel, lays a £50 NOTE on the reception counter, and goes to inspect the rooms upstairs in order to pick one.

 

The hotel proprietor takes the £50 NOTE and runs to pay his debt to the butcher.

 

The Butcher takes the £50 NOTE , and runs to pay his debt to the pig raiser.

 

The pig raiser takes the £50 NOTE , and runs to pay his debt to the supplier of his feed and fuel.

 

The supplier of feed and fuel takes the £50 NOTE and runs to pay his debt to the town's prostitute that in these hard times, gave her "services" on credit.

 

The hooker runs to the hotel, and pays off her debt with the £50 NOTE to the hotel proprietor to pay for the rooms that she rented when she brought her clients there.

 

The hotel proprietor then lays the £50 NOTE back on the counter so that the rich tourist will not suspect anything.

 

At that moment, the rich tourist comes down after inspecting the rooms, and takes his £50 NOTE , after saying that he did not like any of the rooms, and leaves town.

 

No one earned anything.

 

However, the whole town is now without debt, and looks to the future with a lot of optimism .

 

And that, ladies and gentlemen, is how the British Government is doing business today!

[J9withdogs]

Nice idea, but isn't the hotel owner £50 out of pocket? He should have had that money to pay his staff?

[CliveH]

This is actually more accurate than is comfortable. The only difference is that in the story, it is a potential tourist that brings the £50 into the system. Whereas if you wanted to be a little more accurate it would be someone who makes a £50 note from, say a scanner and a printer. It is called Quantitative easing and is what non-economists call 'turning on the printing press'.

In extreme circumstances, governments flood the financial system with money, easing pressure on banks by giving them extra capital.

Full description here:-

 

http://www.guardian.co.uk/business/2008/oct/14/businessglossary

 

It is risky as you can get run away inflation and indeed we had that when Wilson devalued the £ - remember the “£ in your pocket” speech?

 

They can do it now because the bigger risk today is deflation, - nobody buying anything because next month whatever they want will be cheaper and they fear for their financial future so they do not want to spend anyway.

 

So by shovelling more money into the system it is hopes that people spend more.

 

My advice is to look at the emerging markets as they are predicted to do well over the next year or so whilst we put up with miniscule interest rates on deposit accounts and a no growth economy. Just don’t put your eggs in any single basket.

 

[colin]

I'm certain now that how bad the economy is depends on your age, John Major was talking about how bad things where during the 70s and how maggie sorted it out during 80s, well I was a teenager for most of the 70s and cannot remember there being any problems at all with economy, I seem to recall my chief ocupation was chasing after girls, I remember being called to training officers office to be told "less of the wine, women, and song" yeah right like an 18 year old takes much notice of that, if fact when you consider the amount of scandal that when on during the "good times" and now that we have the dour gordon in charge it goes tits up, maybe if every one acted as teenagers there wouldn't be any problems.

[Tony Jones]

colin - 2009-07-10 10:09 AM

 

maybe if every one acted as teenagers there wouldn't be any problems.

 

Not sure Colin. Consider our multiple problems:

 

Banking and debt: encouraging everyone to have whatever they want NOW without worrying about how (or by whom!) it's to be paid for.

 

The economy: Govt saying "The economy will grow, so one day we'll have plenty of money to pay off the national debt."

 

Demographic/pensions timebomb: people saying for decades "Don't want to save, I'd rather spend the money now. Retirement's a long time away and something will turn up."

 

Social breakdown: "I'm just looking after number one."

 

Crime: "I want it, you've got it, I'll take it."

 

Politics (financial scandals): see "Crime."

Politics (sexual scandals): "If I want to have sex with numerous different people, why shouldn't I?"

 

Seems to me that the main problem is that we (and our "leaders") HAVE been acting prescisely like teenagers for far too long!

 

Tony

[CliveH]

Talking of "Time bombs" - a bit of a time warp for me last week. I found an old book I read in my teens in a s/h bookshop and bought it again.

 

Nevil Shute - "In the Wet" - first published in 1953 (before I was born (just!)) and read by me in the late 60's. Fascinating concept whereby a dying man in the Australian Bush recounts a story to a priest set in the future - the 1980's.

 

Reading it now in 2009 was a bit of a revelation. I finished reading it again this morning. Insomnia has its perks when you can read books like this. A short quote:-

 

"He could not make up his mind. He hated these people for their lack of spirit, for their subservience to civil servants, for their outmoded political system of one man one vote that kept them in the chains of demagogues. He venerated them for their technical achievements. To spend three years or more in England was like living in a home for incurables,....."

 

This is from an Australian RAAF pilot and outlines how he saw the Poms. Shute's premise was that the Commonwealth was evolving faster than the Socialist Governed UK because they introduced the Multiple Vote system. The more of a success you made of your life the more votes you as an individual have. Interesting concept. Especially when set out in 1953 and applied to how the world might be in the 1980's.

 

I found it fascinating to read something that was written in the time of rationing about an era I had lived through.

 

The depressing thing is very much how Shute predicted how over governed we would be and how controlling UK governments want to be.

 

The predictions are fascinating. He saw the increasing size of the Civil Service and how the sheer size of it became a burden to the taxpayer and wealth makers such that they moved out of the UK. He did not predict the surveillance society we now live in, but then Shute does not predict the coming of television in the 80's as radio and the newspapers are the main medium for news.

 

What was really startling though was that all those years ago - before I was born, a man with a fantastic imagination and a rare storytelling ability got so much of it right. Depressingly right because it would seem we have learnt nothing as a nation.