CyclopsRock
Member
I dunno about governments, but that's a pretty evil use of a semi colon.
-
Hey, guest user. Hope you're enjoying NeoGAF! Have you considered registering for an account? Come join us and add your take to the daily discourse.
UK PoliGAF thread of tell me about the rabbits again, Dave.
- Thread starter Chinner
- Start date
Apprenticeships are out there, but they don't suit everyone. A 40 year old mother who's out of work and struggling to prove to potential employers that she can do what she is told is probably not bothered about learning how to do Joinery for £50 a week for the next 3 years.
College courses are free when claiming benefits, and whilst doing one you get no hassle from the DWP but again, they don't suit everyone.
Some people just need to be able to prove that they can stand in a shop with a smile and help any customer who needs it. Sorry, but that is how it is. My only fear is that stuck up selfish student lawyer who clearly thought she shouldn't have to prove herself for companies to risk tens of thousands pounds of their money employing her has fucked it up for those hard working people desperate to prove themselves.
War Peaceman
You're a big guy.
You do know she was working in a relevant field for free, right? She was absolutely not work shy or stuck up. She works in a supermarket now. Stop being ridiculous.
She thought it was beneath her, so decided to try to wreck it for everyone to show off her awesome lawyering skills. For some people desperate for work with no references how are they supposed to prove themselves?
For me this stuff should be encouraged but voluntary.... Should make it easy for employers to spot those with a strong work ethic and the lazy twats.
Incontinentia Buttocks
Banned
She was already volunteering elsewhere in a job that would help her in her field so I'm not sure I understand your point as you're seemingly agreeing with her?
There are so many things wrong with this quote.
Miles Quaritch
Member
What to make of this talk about negative interest rates? My savings have already taken a considerable beating, I certainly hope this doesn't come to fruition.
http://www.bbc.co.uk/news/business-21589128
http://www.bbc.co.uk/news/business-21589128
zomgbbqftw
Banned
Keep the pound weak against the Euro. It won't happen, the BoE have been talking the pound down for a while now to "re-energise trade" much like Japan has with the yen. If Germany wasn't in the Euro their currency would be trading at parity or higher with the pound which is bad for our economy since it doesn't. The BoE has been on a mission to eradicate this competitive advantage Germany has over our economy.
CyclopsRock
Member
If the Lib Dems snatch defeat from the jaws of victory, Clegg's finished imo. Between the Rennard thing and the incredibly high expectations for winning this by-election, if they lose it then man, we're in utterly uncharted waters, aren't we? What on earth happens to the coalition when the deputy PM is 'Hesseltined'?
phisheep
NeoGAF's Chief Barrister
Zomg, I get all confused over this strong/weak pound stuff (same as I get confused over the clocks going forward and back every spring and autumn or vice-versa, I know it is all rational somehow but I have trouble getting my head around it).
Can you take me through it slowly? Like now for example I have export opportunities to Portugal and Colombia (and importing from China, USA, India, Pakistan and EU), and my brain fries trying to work out whether this is good or bad for me.
CyclopsRock
Member
zomg is both far more eloquent, and far more likely to be correct than I am, but if the pound is "weak" it means it takes less foreign currency to 'buy' a pound. For your export chances, this is a good thing - what might have cost a Portugese guy 5 euros might now only cost them 4 euros, yet you still get £3. The Deutschmark would have been very strong (lots of people buying German goods = higher demand for the currency = higher price for that currency) which would, in turn, have hurt their exports because then a BMW Z3 used to cost £40k, now it costs £60k, but BMW gets the exact same number of Deustchmarks. However, because they have the Euro, not only do a big chunk of their customers not have to "buy" the German currency in the first place, but that currency is spread out far beyond Germany, which spreads the demand hugely (and, what with half of europe shittings its lederhosen, some are actively trying to get rid of their Euros) which does German exports wonders.
The opposite is desirable if you're an importer.
The opposite is desirable if you're an importer.
Strong = expensive
Weak = cheap
That's literally all you need to know - if you're selling your goods to other economies then you want your currency to be cheap for them. If you're buying then you want their currency to be cheap.
phisheep
NeoGAF's Chief Barrister
Thanks guys.
What that says to me is if, say, I'm buying abroad and selling abroad than I'm taking a hit on purchases because it actually costs me more in pounds but I'm not actually taking a hit on sales because although I'm selling in pounds the other guy is buying in a stronger currency so it is cheaper for him, and maybe I'm getting more sales opportunities?
Yeah, I'm happy enough with that. At big enough gross margins (which I have, despite being probably the cheapest in the UK) I can live with that more than comfortably. I notice a bunch of other bead shops closing though, and a few UK wholesalers starting to panic a bit (hardly surprising, since I'm retailing below their wholesale prices).
zomgbbqftw
Banned
No worries.
So lets start with a product that you export to Europe and you sell it there for 10, it costs, in GBP £5 to produce and half of the components are sourced from overseas. At an exchange rate of 1.25 you make £8 in revenue and £3 gross profit per sale.
If the pound were to weaken across the board by 20% (lets take a simple view and say there are no variations and Britain is engaging in a competitive devaluation against all currencies), it would now be trading at parity with the Euro, so £1 = 1. Unfortunately since 50% of your components are sourced from overseas your cost base has increased by 25% for those parts as well as 10% for producer inflation on locally sourced parts. Your product now costs £5.88 to produce, but because of the weak pound your income has increased from £8 to £10. Your gross profit is now £4.12 per item, an increase of 37%.
A side effect of currency devaluations is that companies start looking to localise their supply chain to ensure that they are more resistant to further weakening on their cost base, so if you were to find a local producer for half of your overseas sourced components and benefited from lower input inflation you would be able to realise an even greater gain. The product would now cost £5.69 and your gross profit would be £4.31 per item, an increase of 44%.
What's more is that if you were profitable before the weakened currency you now have latitude to cut your prices and maintain your original profit margin. All of your German competitors price the same product for 10, like you do, but with a weak pound you decide to take advantage and price your product for 9 which will give a competitive and and drive greater volume than your competitors which comes with benefits also like driving them out of business and cornering the market (see Samsung vs Japan as an example of this, or China vs USA for a different spin).
Weak currency has a lot of benefits for us as a country, but it is considered to be quite aggressive by the international community which is why the UK is engaging in a proxy war with the BoE doing the dirty work and the is Chancellor staying out of it. Japan came under a lot of pressure recently because the new PM Shinzo Abe has talked the yen down from 78 to the dollar to 93 just recently, a massive devaluation which will see Japanese companies become much more competitive with US ones on price.
milanbaros
Member?
You should also keep in mind that a weak pound will lead to additional cost push inflation (see petrol) which will lower real wage growth and put pressure on consumer spending. Depending on your product and the UK proportion of sales the overall effect can be positive or negative.
There is a lot of really interesting papers (that aren't too tough to grasp) if you would like to read further.
There is a lot of really interesting papers (that aren't too tough to grasp) if you would like to read further.
phisheep
NeoGAF's Chief Barrister
Thanks zomg, that makes sense. The one thing I can't do is source more locally, as there is nearly no local sourcing (except for very high-end components, mostly in Birmingham, which isn't really my market). What I'm doing instead is trying to broaden my supplier base in the Far East and Eastern Europe and cut out the middlemen in UK and USA. That should take the costs down faster than exchange rate variations can catch up, at the cost of a bit more working capital for stock in transit.
Probably not too much of a problem for me (though it is for some/most competitors) as I'm deliberately running on ridiculously low fixed costs of about £1k a month. Similarly, pressure on consumer spending benefits me as people will come to me for components rather than to someone more expensive, and - importantly - come to me rather than to jewellers for repairs (if I fix something for a fiver in 10 minutes rather than in a week for £80, then I get ALL of their repeat business!).
CyclopsRock
Member
Christ, phisheep, is your shop in a wheelie bin or something?! My personal fixed costs are about £1k a month!
phisheep
NeoGAF's Chief Barrister
Oh, my personal costs are way higher than that too. But I'm very careful to keep the business's fixed costs down. Essentially what happens is the spring/summer/autumn pays for the winter so our personal cashflow is very seasonal (understanding bank manager helps), but because we keep the fixed costs down we can easily ramp down the business when things are slow and ramp it back up again afterwards. I've made a trading loss in only one month so far and that's because I had to purchase ahead of time for March because of Chinese New Year.
But it's no wheelie bin. Nice little shop. Rent £100 a week, electric £45 a month, water £60 a year. It's surprisingly inexpensive to get started.
EDIT: dammit, went right off topic for a politics thread. Naughty me.
CHEEZMO
Obsidian fan
Don't stop believin'!
CyclopsRock
Member
In fairness....
Government spending is going up. Not just as a response to higher welfare payment either, but core government spending is going up. Not only that but...
This shows how Osborne has repeatedly back-loaded the cuts until after the next election (when it likely won't be him that has to actually deal with it). In the words of the Spectator, where I just ganked those graphs from, "Darling had promised to halve the deficit in four years, Osborne is now taking five years and will probably make it six in his next Budget."
We're actually in a bizarro situation where the coalition are getting a lot of stick for their cuts, without actually implementing many. This is the opposite to what they want (and the opposite to what happened in 1976 when, again as noted by the Speccie, the Labour government cut more in a single year than the Tories are in 4 years).
zomgbbqftw
Banned
City of London 1 - 0 ONS
GDP uprated by 0.3% YoY, the double dip never really happened and the Q4 contraction should look a lot smaller next month as more services and production data comes in. We told them 4 months ago that their GDP estimates were out by around 0.3-0.5% and that there probably wasn't a recession and here we are 4 months later and the ONS have revised their figures to almost match the City consensus.
They always get there, but they take so fucking long and damage the economy by creating stupid headlines. There was no double dip recession, Q2 2012 will eventually get revised up to -0.2% as well from -0.4% (originally -0.7%) more in line with City consensus. Our estimate for Q4 2012 is 0.0%, and we expect the ONS to catch up with that too, and Q1 looks very strong, possibly 0.5-0.7%, if the ONS falls into line with our estimates we think 2012 growth should be 0.9% up from their original rating of 0.0% and 2012/13 growth will be 1.3%. So far the ONS has taken 8-12 months to come into line with City consensus and they do seem to always get there.
It's not really surprising given that employment growth in 2012 shows 550k new jobs created. It's just a very damning indictment about the quality of GDP figures produced by them.
GDP uprated by 0.3% YoY, the double dip never really happened and the Q4 contraction should look a lot smaller next month as more services and production data comes in. We told them 4 months ago that their GDP estimates were out by around 0.3-0.5% and that there probably wasn't a recession and here we are 4 months later and the ONS have revised their figures to almost match the City consensus.
They always get there, but they take so fucking long and damage the economy by creating stupid headlines. There was no double dip recession, Q2 2012 will eventually get revised up to -0.2% as well from -0.4% (originally -0.7%) more in line with City consensus. Our estimate for Q4 2012 is 0.0%, and we expect the ONS to catch up with that too, and Q1 looks very strong, possibly 0.5-0.7%, if the ONS falls into line with our estimates we think 2012 growth should be 0.9% up from their original rating of 0.0% and 2012/13 growth will be 1.3%. So far the ONS has taken 8-12 months to come into line with City consensus and they do seem to always get there.
It's not really surprising given that employment growth in 2012 shows 550k new jobs created. It's just a very damning indictment about the quality of GDP figures produced by them.
Unemployment is falling though....
Redundancies always happen, they just tend to get reported more by the media who love talking the country down constantly in a recession as misery sells papers.
CyclopsRock
Member
Very interesting, ta.
Why is that, do you think? Is it that they are more cautious and would rather be wrong in the negative way than the positive?
zomgbbqftw
Banned
They just aren't very good at their jobs, and in a downturn (which is what this is) it's difficult to get decent figures without relying on privately collected data (which is what the City institutions do at a very great cost). We have literally unlimited funds to get our data but the ONS don't. That means they can't hire the best people and it leads to poor forecasting and poor measurements.
It's not good to overestimate growth, but it is probably worse to underestimate it during a downturn. Under Labour the ONS was nicknamed as the Overestimation of National Statistics. I expect the new government wanted to clean house, but it's tough to get it right.
The ONS is full of Cardiff Business School graduates, its no surprise
D:
phisheep
NeoGAF's Chief Barrister
I worked briefly in the ONS (short term production statistics bit) in the 1970s. Nightmare it was.
It's probably a breach of the Official Secrets Act to say so, but we lost 3 years worth of cotton & wool industry stats because the person employed to deal with them simply threw away everything she couldn't understand, which was nearly all of it.
Then the computer people went on strike so the (singular) computer was off air for two weeks, so three of us did all its work by hand instead and nobody noticed the difference.
Nicktendo86
Member
So there never was a double dip, how comes then there is no mention of this on the BBC? When it was announced by the ONS that we had technically gone back into recession it was all over the news but now, when the figures have been revised up, not a peep.
Edit - just read that over 40% of councils are putting up council tax next year despite the governement offering money not to. Would love to see a map of which councils are ding this and what party leads them.
zomgbbqftw
Banned
Don't ask me, I'm not in charge of BBC editorial. The BBC seems to specialise in talking Britain down though, when it's good news it's a 60 second item, if it's bad news then they wheel out "experts" from the Guardian and the Indy to talk about how bad it is for the country.
Nicktendo86
Member
My point exactly zomg, and it drives me nuts.
War Peaceman
You're a big guy.
It is terribly boring how much the press is hyping up the Eastleigh by-election. People are even saying that it could cause the end of Nick Clegg as leader. They are dreaming if they think that will occur.
QuicheFontaine
Member
Remember when the news media (and I'm not just confining this to the BBC, it was everyone) effectively caused a run on the bank at Northern Rock?
Running pieces with titles like "ROCK BOTTOM" and then acting all bemused as to where all the panic was coming from. There's an excellent Charlie Brooker video about it, can't remember if it was Screenwipe or Newswipe.
CyclopsRock
Member
I disagree. I think it absolutely could end him. Coupled with the Rennard thing (where the issue is not so much Rennard, who basically just acted like a pervy old man, but the Lib Dem's either lying about it or being clinically incompetent over it). It's the first by-election where it's really one coalition partner against the other - all the others have been against Labour and/or Scottish nutters. Couple all of this with the fact that Clegg is seen as a liar by many and becoming more and more of a pariah to the grass roots, and anyone with designs on sticking the knife in knows they'll need a few years run up for the new leader before the 2015 election so it's going to need to happen this year. Eastleigh would prove a very effective catalyst.
Now, I'm not saying this will happen, but I certainly don't think it's beyond the realms of possibility for this to be the straw that breaks his crippled back.
"Scottish nutters"... a tad pejorative for the party with perhaps the best recent track record in any country on these islands.
I don't think the majority of people - even Lib Dem - voters are that interested in the Rennard story. It's boring and I think it's quite obvious it's being "bigged up" in the media. The real damage to Clegg comes as it always has from the tuition fee decision and the Lib Dem's role in the coalition. Rennard... just hasn't gripped anyone I know at least
har har
I disagree. Coming off the back of all the pedo ring scandals it's hugely telling that one of the most progressive parties just shrugged their shoulders at continued sexual harrassment. Hugely important to me and good investigation by Channel 4.
I'm not saying it's not important - and certainly Parliament needs to get away from the Boys Club image it still sports and start actively investigating rather than being reactive.
I just don't think the story has really caught on and most people I've talked to seem disinterested in it. I think it'll be one of the least important factors in the by-election, for better or worse.
CyclopsRock
Member
I was talking about Galloway in Bradford
If it were Cable or Farron, I'd agree with you - but the grass roots already dislike Clegg, with the average Lib Dem canvasser being about 90 degrees to the left of Clegg. The Lib Dems, far more than Labour or the Tories, rely on their grass roots as the main machination of their politics (and they're very, very good at it) so I think the opinions of the grass roots affect them more than the other two parties.
I was talking about Galloway in Bradford
Hah. Carry on.
Captain_Spanky
Member
It's not just at "the taxpayers expense" though. What about National Insurance contributions. Plenty of people pay tax between being homeless also, thjey are effectively insuring themselves against times of hardship. I mean...fuck. Tax doesn't even work that way. It's not ones expense. It's put in a pot and the Government decides how to spend it.
Delusibeta
Banned
War Peaceman
You're a big guy.
I think the Tory leadership needs Clegg as any replacement would, by necessity, be more antagonistic towards them. Not to say that he shouldn't go, this Rennard ordeal is despicable from a moral point of view.
On another note, does anyone think that Cameron's vaunted Eurospeech did more harm than good? By making the EU more of an issue yet vacillating on the actual referendum he only played into UKIPs hands. The main reason UKIP did so well in Eastleigh was that it was a by-election and they are the protest vote, so I am speaking more generally.
Visualante2
Member
Isn't it kind of sad that it is assumed that governments will have a tough mid term? Heaven forbid the thought that a government could serve the people well and grow their electorate. Sad complacency and blame shifting.
zomgbbqftw
Banned
Gay marriage. That's what caused UKIP's rise. Nothing really to do with Europe.
Nicktendo86
Member
That... really is sad. As a strait man who is going to marry his fiancé in 5 months, I couldn't care less if two men who love each other want to celebrate their love for each other like myself and my fiancé want to. It doesn't change me or my life one jot if gay people want to get married and I can't fathom how ANYONE could get so worked up over it. Live and let live people.
How did you reach that conclusion?
QuicheFontaine
Member
I don't think you'll find many arguments against this on Gaf. And congrats on getting married.
Anyway, here's my excellent by-election joke.
Q: What would Michael Stipe from REM call the Eastleigh by-election results (if Kilroy was still a member of UKIP)?
A:
Orange Crush!
zomgbbqftw
Banned
Polls showed a fairly large UKIP > Con swing in the immediate aftermath of the EU referendum pledge, and it held until Dave pushed gay marriage through and the same polls all showed a big Con > UKIP swing.
In what way is this information surprising, the less liberal Tories went to a right wing party that supports their ideals. It's not surprising to me at least, I think if Dave went in knowing that the political cost was not going to be quite grave then he was a fool. I'm of the opinion that the end result is worth it, getting gay marriage onto the statue book is much more important than any short term hit. However, I'm not the PM and I'm not running for re-election in 2015...