Quantcast
Please log in or register. Registered visitors get fewer ads.
Forum index | Previous Thread | Next thread
With regard to paying for Covid 08:12 - Mar 5 with 927 viewsGuthrum

I am surprised the Treasury haven't come up with something more creative, such as a bond system similar to during the World Wars.

At a time when savings returns are extremely low they didn't even need to offer very high yields. And, of course, with Consol-type borrowing, they can be redeemed at a time of the government's own choosing.

During the various lockdowns, those who were still earning didn't have a lot of leisure and travel activities to spend money on. Plus it could have spearheaded a "we're all in this together" national unity campaign.

Would have encouraged saving and kept funds in the country for the government to use. But instead they preferred to let people send their money to Jeff Bezos.

Good Lord! Whatever is it?
Poll: McCarthy: A More Nuanced Poll
Blog: [Blog] For Those Panicking About the Lack of Transfer Activity

1

With regard to paying for Covid on 08:16 - Mar 5 with 700 viewsChurchman

I thought they’d do something like that. Seemed like a no brainier to me.
0

With regard to paying for Covid on 08:16 - Mar 5 with 704 viewsMullet

Free-market innit Guffers, it's odd they've been more worried about horse racing, landlords, pub landlords turned PPE procurement specialists, decorating their own pads etc.

Almost like they are arrogant, elitist, traitors who in the war time would have been all Mitford sistery and the like.

The fact that even with such a vast majority they sought no cross-party help or collaboration perhaps tells us why such a thing just isn't in their make up. We are merely here to bow and scrape so that they might elevate themselves by standing on our backs.

Bunch of utter sh1ts and scumbags.

Poll: Would you like Ipswich to get promoted?
Blog: Climbing Up the Walls

4

With regard to paying for Covid on 08:22 - Mar 5 with 668 viewsSteve_M

Sunak isn't very creative though, except with his personal branding.

The Tory party has forced through and watched a decade of politically-motivated 'austerity', seen the effects in a time of crisis and still wants more. They cant mention Brexit either, that's adding an additional burden on the economy through political choice too.

Poll: When are the squad numbers out?
Blog: Cycle of Hurt

0

With regard to paying for Covid on 08:22 - Mar 5 with 665 viewsTractorWood

The Government is up to its eyeballs in debt. Debt as % of output is the key measure apparently.

Although the Gov could restructure its debt more cheaply by doing a massive 1% bond or similar, billions of safe capital would flood out of the banks, weakening their balance sheets.

I know that was then, but it could be again..
Poll: At present who do you think you'll vote for?

0

With regard to paying for Covid on 08:24 - Mar 5 with 656 viewsTimefliesbyintheblue

They announced a new NS&I green savings bond.
0

With regard to paying for Covid on 08:28 - Mar 5 with 643 viewsPinewoodblue

Problem with such a bond is that it would take cash out of the economy at a time they want people to start spending more. They are looking for over7% growth in 2022.

Poll: how many changes to starting 11 v Wcombe

1
With regard to paying for Covid on 08:31 - Mar 5 with 624 viewsGuthrum

With regard to paying for Covid on 08:28 - Mar 5 by Pinewoodblue

Problem with such a bond is that it would take cash out of the economy at a time they want people to start spending more. They are looking for over7% growth in 2022.


But it would put those funds into government hands to spend on more targeted stimulus measures, rather than just Stuff from Amazon (much of the benefit from which goes out of the country anyway).

Good Lord! Whatever is it?
Poll: McCarthy: A More Nuanced Poll
Blog: [Blog] For Those Panicking About the Lack of Transfer Activity

0
With regard to paying for Covid on 08:33 - Mar 5 with 609 viewsGuthrum

With regard to paying for Covid on 08:24 - Mar 5 by Timefliesbyintheblue

They announced a new NS&I green savings bond.


But a Covid Bond could be part of a concerted campaign of promotion, rather than just another - little-trumpeted - savings scheme.

Good Lord! Whatever is it?
Poll: McCarthy: A More Nuanced Poll
Blog: [Blog] For Those Panicking About the Lack of Transfer Activity

0
Login to get fewer ads


With regard to paying for Covid on 08:37 - Mar 5 with 592 viewsBluefish

Surely everyone is like me though, I've bought every piece of golf gear possible in the first lockdown. All the things I had on my wish list for years. This lockdown I can't stop buying running stuff. I have also bought more clothes in the past year than I normally would in about 10 years. When shops reopen and they expect an economy boom I'll probably stop shopping altogether

Poll: Who should partner Chmabo at cb now KVY is back?
Blog: [Blog] Long Live King George

0
With regard to paying for Covid on 08:37 - Mar 5 with 589 viewsPinewoodblue

With regard to paying for Covid on 08:31 - Mar 5 by Guthrum

But it would put those funds into government hands to spend on more targeted stimulus measures, rather than just Stuff from Amazon (much of the benefit from which goes out of the country anyway).


Must admit to window shopping on Amazon. Find what you want then ideally buy direct and not through Amazon.

Poll: how many changes to starting 11 v Wcombe

0
With regard to paying for Covid on 08:47 - Mar 5 with 539 viewsGuthrum

With regard to paying for Covid on 08:37 - Mar 5 by Bluefish

Surely everyone is like me though, I've bought every piece of golf gear possible in the first lockdown. All the things I had on my wish list for years. This lockdown I can't stop buying running stuff. I have also bought more clothes in the past year than I normally would in about 10 years. When shops reopen and they expect an economy boom I'll probably stop shopping altogether


Our street is a non-stop traffic jam of delivery vans and the communal cardboard recycling bins are constantly over-stuffed with Amazon smiles.

Good Lord! Whatever is it?
Poll: McCarthy: A More Nuanced Poll
Blog: [Blog] For Those Panicking About the Lack of Transfer Activity

0
With regard to paying for Covid on 08:48 - Mar 5 with 527 viewsBluefish

With regard to paying for Covid on 08:47 - Mar 5 by Guthrum

Our street is a non-stop traffic jam of delivery vans and the communal cardboard recycling bins are constantly over-stuffed with Amazon smiles.


I've deliberately cancelled prime and tried to avoid amazon on 2021 because too much cash was going to 1 man. I'm now using lots of shops but probably not really that different in the scheme of things

Poll: Who should partner Chmabo at cb now KVY is back?
Blog: [Blog] Long Live King George

0

With regard to paying for Covid on 08:56 - Mar 5 with 514 viewsStokieBlue

A Covid bond scheme would have been nice, especially for the community spirit it could have mustered but I suspect to get decent uptake they would have need to have offered coupons in the range of 3%+.

Given that they can borrow money far cheaper in the markets at the moment I'm not surprised they are going for that option. After WW2 it would have been more expensive to borrow in the markets than issue domestic bonds.

SB

“You may not feel outstandingly robust, but if you are an average-sized adult you will contain within your modest frame no less than 7 X 10^18 joules of potential energy—enough to explode with the force of thirty very large hydrogen bombs, assuming you knew how to liberate it and really wished to make a point."

0
With regard to paying for Covid on 09:02 - Mar 5 with 482 viewsTractorWood

With regard to paying for Covid on 08:56 - Mar 5 by StokieBlue

A Covid bond scheme would have been nice, especially for the community spirit it could have mustered but I suspect to get decent uptake they would have need to have offered coupons in the range of 3%+.

Given that they can borrow money far cheaper in the markets at the moment I'm not surprised they are going for that option. After WW2 it would have been more expensive to borrow in the markets than issue domestic bonds.

SB


Yeah so apart from the Gov not needing any more debt and it not being commercially viable at a number of levels, it's a no brainer.

I hate the Tories as much as the next dude but this is a non starter for bashing.
[Post edited 5 Mar 9:06]

I know that was then, but it could be again..
Poll: At present who do you think you'll vote for?

0
With regard to paying for Covid on 09:02 - Mar 5 with 481 viewsGuthrum

With regard to paying for Covid on 08:56 - Mar 5 by StokieBlue

A Covid bond scheme would have been nice, especially for the community spirit it could have mustered but I suspect to get decent uptake they would have need to have offered coupons in the range of 3%+.

Given that they can borrow money far cheaper in the markets at the moment I'm not surprised they are going for that option. After WW2 it would have been more expensive to borrow in the markets than issue domestic bonds.

SB


Would returns need to be that high, given most savings accounts are offering well under 1% at the moment?

Good Lord! Whatever is it?
Poll: McCarthy: A More Nuanced Poll
Blog: [Blog] For Those Panicking About the Lack of Transfer Activity

0
With regard to paying for Covid on 09:04 - Mar 5 with 474 viewsTractorWood

With regard to paying for Covid on 09:02 - Mar 5 by Guthrum

Would returns need to be that high, given most savings accounts are offering well under 1% at the moment?


It would need to be between 1-2% imo. Bear in mind 6 month libor is 0.2% as a general context for how farcically cheap debt is.

I know that was then, but it could be again..
Poll: At present who do you think you'll vote for?

0
With regard to paying for Covid on 09:06 - Mar 5 with 467 viewsStokieBlue

With regard to paying for Covid on 09:02 - Mar 5 by Guthrum

Would returns need to be that high, given most savings accounts are offering well under 1% at the moment?


Given bonds are inflexible instruments that have a fixed term I think you'd need to offer significantly over the current rates in order to get people to lock in their money for X years.

It's worth noting that even 1% is significantly more expensive than issuing some GILTS. The current approximate coupon for a 2 year GILT is 0.125%.

It's a nice idea but at the moment it doesn't really make economic sense.

SB

“You may not feel outstandingly robust, but if you are an average-sized adult you will contain within your modest frame no less than 7 X 10^18 joules of potential energy—enough to explode with the force of thirty very large hydrogen bombs, assuming you knew how to liberate it and really wished to make a point."

1
With regard to paying for Covid on 09:06 - Mar 5 with 461 viewsGuthrum

With regard to paying for Covid on 09:02 - Mar 5 by TractorWood

Yeah so apart from the Gov not needing any more debt and it not being commercially viable at a number of levels, it's a no brainer.

I hate the Tories as much as the next dude but this is a non starter for bashing.
[Post edited 5 Mar 9:06]


Government debt is currently unavoidable, given the spending necessary to support the economy through Covid.

I'm thinking of tapping into a national resource (people comfort-buying tons of Stuff with the money they're saving by not going out), rather than trying to find more savings from cutting already well-trimmed public services.

Good Lord! Whatever is it?
Poll: McCarthy: A More Nuanced Poll
Blog: [Blog] For Those Panicking About the Lack of Transfer Activity

0

With regard to paying for Covid on 09:07 - Mar 5 with 455 viewsm14_blue

Remarkably unimaginative budget, at a time when we desperately needed someone with a vision it seems Sunak is a massive let down.

Is cutting services to that degree, when we’re trying to recover from a pandemic, really a credible plan?
0
With regard to paying for Covid on 09:11 - Mar 5 with 449 viewsGuthrum

With regard to paying for Covid on 09:06 - Mar 5 by StokieBlue

Given bonds are inflexible instruments that have a fixed term I think you'd need to offer significantly over the current rates in order to get people to lock in their money for X years.

It's worth noting that even 1% is significantly more expensive than issuing some GILTS. The current approximate coupon for a 2 year GILT is 0.125%.

It's a nice idea but at the moment it doesn't really make economic sense.

SB


Consols (of which War Bonds were a variety) weren't time-limited. Effectively an annuity, redeemable at the issuer's discretion.

Plus you're not in the competitive savings market, but persuading people to put money into saving the country from Covid rather than buying more tat online (there's zero return on the latter, either).

Good Lord! Whatever is it?
Poll: McCarthy: A More Nuanced Poll
Blog: [Blog] For Those Panicking About the Lack of Transfer Activity

0
With regard to paying for Covid on 09:14 - Mar 5 with 440 viewsTractorWood

With regard to paying for Covid on 09:06 - Mar 5 by Guthrum

Government debt is currently unavoidable, given the spending necessary to support the economy through Covid.

I'm thinking of tapping into a national resource (people comfort-buying tons of Stuff with the money they're saving by not going out), rather than trying to find more savings from cutting already well-trimmed public services.


Current levels of debt can be maintained due to the extremely low cost of debt. If it was expensive we would be absolutely destitute.

Proposing the Government take funds from the public at a rate that is higher than it would the arm's length market is not an good idea. If the problem is Amazon, as you are sort of implying, we just need to tax them properly by rumbling them on their transfer pricing.

I know that was then, but it could be again..
Poll: At present who do you think you'll vote for?

0
With regard to paying for Covid on 09:15 - Mar 5 with 435 viewsStokieBlue

With regard to paying for Covid on 09:11 - Mar 5 by Guthrum

Consols (of which War Bonds were a variety) weren't time-limited. Effectively an annuity, redeemable at the issuer's discretion.

Plus you're not in the competitive savings market, but persuading people to put money into saving the country from Covid rather than buying more tat online (there's zero return on the latter, either).


That's even worse at the moment though isn't it? It's essentially a perpetual bond redeemable at any point.

If you issue a load now but don't know when they will be called then you are exposing yourself to the treasury markets moving in the meantime and thus you might have to borrow at a higher rate than the coupon on the bonds in order to pay back the principle.

I agree that your final paragraph is a nice idea of course but is it worth the extra cost for that ideal? I suspect there are lots of people who simply have no interest in purchasing government bonds of any sort.

SB

“You may not feel outstandingly robust, but if you are an average-sized adult you will contain within your modest frame no less than 7 X 10^18 joules of potential energy—enough to explode with the force of thirty very large hydrogen bombs, assuming you knew how to liberate it and really wished to make a point."

0
With regard to paying for Covid on 09:23 - Mar 5 with 428 viewsGuthrum

With regard to paying for Covid on 09:14 - Mar 5 by TractorWood

Current levels of debt can be maintained due to the extremely low cost of debt. If it was expensive we would be absolutely destitute.

Proposing the Government take funds from the public at a rate that is higher than it would the arm's length market is not an good idea. If the problem is Amazon, as you are sort of implying, we just need to tax them properly by rumbling them on their transfer pricing.


I'm citing Amazon, but that's more the conduit by which money is departing without any particular benefit to the country (which pertains to your last point, something governments seem terribly scared to approach). A Covid bonds scheme could harvest some of that, if they''re unwilling to use taxation.

If borrowing is so vastly cheap, why the need to look at public sector cuts (or meagre pay increases for the NHS) at this stage, rather than continuing the stimulus programme into a recovery?

Good Lord! Whatever is it?
Poll: McCarthy: A More Nuanced Poll
Blog: [Blog] For Those Panicking About the Lack of Transfer Activity

0
With regard to paying for Covid on 09:31 - Mar 5 with 412 viewsGuthrum

With regard to paying for Covid on 09:15 - Mar 5 by StokieBlue

That's even worse at the moment though isn't it? It's essentially a perpetual bond redeemable at any point.

If you issue a load now but don't know when they will be called then you are exposing yourself to the treasury markets moving in the meantime and thus you might have to borrow at a higher rate than the coupon on the bonds in order to pay back the principle.

I agree that your final paragraph is a nice idea of course but is it worth the extra cost for that ideal? I suspect there are lots of people who simply have no interest in purchasing government bonds of any sort.

SB


No, it's the Treasury's discretion when to repay. The 4% Consols, which represented remaining War Bonds from World War II, were not redeemed until 2015. Not in the lifetime of many of the purchasers.

Good Lord! Whatever is it?
Poll: McCarthy: A More Nuanced Poll
Blog: [Blog] For Those Panicking About the Lack of Transfer Activity

0
With regard to paying for Covid on 09:34 - Mar 5 with 405 viewsStokieBlue

With regard to paying for Covid on 09:31 - Mar 5 by Guthrum

No, it's the Treasury's discretion when to repay. The 4% Consols, which represented remaining War Bonds from World War II, were not redeemed until 2015. Not in the lifetime of many of the purchasers.


So in that case you're back to my first point of many people are unlikely to want their funds tied up and a very low coupon with no known time horizon of when they will get their money back.

I think you're going to get far less takers for that proposition than you think given the uncertainty around rates, inflation and the economy (as well as Brexit) we are likely to see over the coming years.

SB
[Post edited 5 Mar 9:34]

“You may not feel outstandingly robust, but if you are an average-sized adult you will contain within your modest frame no less than 7 X 10^18 joules of potential energy—enough to explode with the force of thirty very large hydrogen bombs, assuming you knew how to liberate it and really wished to make a point."

0

Please log in or register. Registered visitors get fewer ads.
About Us Contact Us Terms & Conditions Privacy Cookies Advertising
© TWTD 1995-2021