The next state to be exposed to the debt crisis? Goldman Sachs says The UK

8 posts

I Can't Hear Poors
nuclear launch detected IT Wizard SteamshipTime

Goldman's Sigma X Hints Who The Next Contagion Target Is

Five months ago, when Italian yields were still tame in the 3% ballpark, and not 7% where they are today, we suggested that based on trading patterns and overall volume in Goldman's dark pool, Italy may be about to experience a "Greek episode." Days later we were proven right as Italian yields and spreads started their relentless move wider, with only those who had access to Sigma X being able to get an advance whiff of what was about to happen. Well today we are happy to report that the German diversion may have worked: the truth is that nobody appears to care about Germany. Instead what everyone does seem to care about, is the nation with the greatest combined debt (government, corporate and household) to GDP in the world. Yup. The UK.
As a reminder:
And here is who is most active today:
Niccolo and Donkey
Azimuth SweetLeftFoot

On a related note:

Why doesn't Britain make things any more?

Read the rest at the link above....

Yeah, I read the Guardian story when it came out. I have been saying this for the last few years. Due to Missus Fatcher's ideological war on the unions (read working class) the Brits are fucked.

Niccolo and Donkey
Must "war on unions" be conflated with de-industrialization? Or was there a way to keep a strong manufacturing sector without kow-towing to unions?
Of course there is. You can even have a strong manufacturing sector alongside strong unions. Germany would be the key example of this. Japan shows (there problems weren't caused by the manufacturing industry, rather the property bubble) you can have a strong manufacturing sector that pays good wages and has good conditions.

The UK was always going to undergo a process of de-industrialisation of some sort. Thatcher took this opportunity to break the power of various unions as a way of breaking the Labour party. She also specifically set out to break the strong tradition of communal (read community focused) British, specifically English in her crosshairs, working class identity as found in mining towns, shipbuilding and steel towns etc.

The whole idea was to break those strong communal links between the members of the non-capital owning class. Thus the sale of council houses etc etc.

Problem is her idea that everyone in the UK would make money at some level in "financial services and the insurance industry" or work in a wider service industry that served those people was - as we're seeing - ultimately unsustainable.

(A notable exception to the attack on manufacturing was the arms industry, although that is now an inevitable casualty of the effects of globalisation)
Team Zissou

It doesn't matter what Thatcher did or didn't do. Labor unions can't survive global trade, much less the one-two punch of global trade and immigration.

What puzzles me is why people keep calling for Third World immigration when all the jobs for which the immigrants could qualify are disappearing, either thru automation or over to population-dense Asia.

I guess it's just because we wuvs them so much.

See Burnham on the managerial state.

Immigrants in a real sense are ''clients'' of government. Government has no real interest in if they work or don't work, earn or don't earn as its unlikely that the core earning class in America or England is going to simply vanish; thus, despite a dearth of real capital, governments retain liquidity while at the same time dramatically expanding the scope and scale of populations that they cater to.

One thing Burnham, and Sam Francis, appreciated that most Anglo and American political thinkers don't and never have is that government is an actor unto itself, with discrete interests, that are not profitable in any conventional sense yet that nonetheless sustain their power.

The interesting question will be how government will manage these lumpen populations in the absence of national wars that call for mobilization, as that has been a major pressure valve by which the structural ailments wrought by the influx of immigrant clientage has been managed.

One thinks of Murray Rothbard when they watch a GOP debate during primary season. America is a country mobilized towards a major war that never arrives. That simply isn't sustainable overtime.
From what I can tell, this is true of almost any institution. I don't think the intent to grow and hold onto power is overt (except in some cases of government) but rather, part of the design of an institution. They serve their purpose and they serve themselves.