AN AWFUL LOT has changed since Rishi Sunak, the chancellor, unveiled his budget in March. Britain’s economy looks set to experience an unprecedentedly rapid and deep recession. What is more, the government, through actions such as the furlough scheme to support employment, is choosing to bear an unusually large share of the initial costs. The result will be much higher government debt than previously anticipated.
There is now so much uncertainty that the official government forecasters—the Office for Budget Responsibility and the Bank of England—have declined to issue their usual forecasts, instead presenting what they call “scenarios”. More detailed modelling by the Resolution Foundation shows what may be to come.
But at the same time, interest rates have collapsed. When the budget was delivered, the OBR expected the yield on government debt to average around 0.9% a year between 2020 and 2023. Since then the Bank of England has cut rates to a record low and restarted its programme of quantitative easing . As a result, the yield on the benchmark ten-year government debt has fallen to closer to 0.2%.
Low borrowing costs are good news for the government’s finances. In the Resolution Foundation’s scenario, interest costs will take up a smaller share of tax revenues by 2024 than was expected at the budget. Indeed, they will be lower than at any point in Britain’s post-war history. And not only will new borrowing attract a lower rate, but as existing debt is refinanced the cost of servicing it will fall, too. More debt leaves the government vulnerable if interest rates return to higher levels.
Do you remember BoJo called himself a war-time PM? Look at that level of debt! That’s his goal.
You'll pay later. The interest rate can go up and of course the principal is greater. Then bit by bit you're the property of the creditor. Everyone's talking about governments building debt - but not much about who's lending the money. They'll be in charge a bit more.
But when interest rates start to rise then we are all in deep shit correct?
Wow...
We need to get the show on the road fast. Not at the current snail's pace.
We have summarized this news so that you can read it quickly. If you are interested in the news, you can read the full text here. Read more:
United States Latest News, United States Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
Asia Pacific stocks set to trade higher following overnight Wall Street surgeOvernight on Wall Street, the S&P 500 advanced 1.7% to 2,971.61, its highest closing level since March 6. Shit floats during a flood of water. Shit stocks float during a flood of digital money. Better find a digital Ark. World’s Greatest Illusionist: The Federal Reserve Watch as the curtain is pulled back on the Wizard of Eccles
Source: CNBC - 🏆 12. / 72 Read more »
What to watch today: Stocks set to open lower during what's been otherwise a strong week so farFutures are lower Thursday, one day after the S&P 500 closed at its highest level since March 6. Right now the stock market is too dangerous to play with.. Just hold your positions and wait Politics aside, Teekay Tanker's earnings announced this AM were stellar. Consider a $16 stock that earns over $3.00 in one quarter, writes a $200M check to pay 25% of their debt off, trades at a P/ E around 1, cash flow +++ and it's up a whopping 4% this morning. GO FIGURE! The stocks set lower at the opening bell has nothing to do with the unemployment. It lowers because of the balance for the WS profit spreadsheet in sick time imaginative recovery; means that the WS tries hard to prevent its own bankruptcy if DJ failed below 18K.
Source: CNBC - 🏆 12. / 72 Read more »
France's coronavirus deaths on the rise again, at 28,132French health authorities reported 110 new coronavirus deaths on Wednesday, an increase of 0.4%, bringing the total to 28,132, the fourth-highest in the world behind the U.S., Britain and Italy. After charlie Hebdo....this is fun😂 La joie de vivre....can make you sick Must be all those homeless migrants enriching French culture
Source: Reuters - 🏆 2. / 97 Read more »
Alphabet, Fox and Netflix CEOs were among the 50 highest paid CEOs in 2019While 2020 might see a freeze in CEO salary, 2019 was a good year for executive pay. 24/7 Wall St. reviewed information provided by public business information company MyLogIQ to determine the 50 highest paid CEOs of 2019: In other news, Sara Carter said the media liberals used to denounce FBI abuses — until the bureau went after Team Trump. Lol, a corrupt world
Source: USATODAY - 🏆 100. / 63 Read more »
Centenarian Who Raised Millions For U.K. Health Workers To Be KnightedCapt. Tom Moore thanked the Queen, Prime Minister Boris Johnson and the public of Great Britain for the honor, pledging to 'remain at your service.'
Source: HuffPostWomen - 🏆 27. / 68 Read more »
Maryland reports highest 1-day rise in coronavirus infectionsA new graduate of Brooklyn Law School honored her class by creating a miniature commencement ceremony, printing and arranging individual photos—with caps—in her yard, to make sure students were acknowledged for their 'tremendous amount of dedication.' Looks more like mini cemetary That is just sad...
Source: ABC - 🏆 471. / 51 Read more »