Taxing private pensions, assets and shares? More madness on the way.

 Due to low productivity, Britain has increasingly relied on financial services. There are two sides of banking. One is the conventional side of banking based on mortgages and loans and the other is financial banking, lending money to investors that take a huge deal of risk and therefore expect higher rewards. 

Private pension funds very much depend on shares and investments and values fluctuate on a daily basis, so there is an inherent level of risk. How can you tax shares? Will you tax what a share was worth on Monday or what a share was worth on Tuesday?

Imagine yourself as a Northern Rock shareholder. One day you count your wins. You have an investment and you have a return. The next day, your investment evaporates because the value of your shares is literally zero and you have no return. Are we going to see debt taxed?

The only growth that the present Labour government will produce is the growth of debt, unemployment, illegal employment, and fraud. Launching a virulent attack against the one sector that keeps Britain alive is cutting down the tree on which you are standing. The 2008 financial crise will feel like a pleasant vacation.

The infamous event affecting people who had used their assets to support insurance payments comes to mind. One day they were riding the waves of opulence and the next day they were selling everything they had to pay for insurance claims.

In 1997, the Labour government with Gordon Brown as Chancellor of the Exchequer made the Bank of England independent

 

Dear Helen Hayes MP,

What many politicians don't seem to undertand is that:

1) The Bank of England was made an independent organization. It was Gordon Brown MP as Chancellor of the Exchequer that made the Bank of England independent in 1997.

2) The moneys lent by banks don't belong to banks. Banks borrow money to lend. The banks gave people huge amounts of money for people to buy property and must return the said moneys when people pay back loans and pay interest to those they borrowed money from.

Because of this, when people started to default loans, Gordon Brown had to prop up banks so that the financial system would not collapse.

Was Rachel Reed an MP under Tony Blair? Does she know how tha banking system works? If she was an MP then and if she knows how the banking system works, she shoudn't come up with the load of nonsense she has come up about 'banks helping people'. If banks have to borrow money - provided they can come up and borrow money - they will have to borrow money at market values, thus increasing their vulnerability and cutting down their margins. Does the Labour Party want the banking system to collapse?

When banks where capitalized under Labour, there were new rules implemented by :Labour about reserves that had to keep in order to protect peoples' accounts. The division was made between conventional banking and investment banking. Is Rachel Reed suggesting, that safety rules imposed then by the Labour government have to be abandoned?

Is the Labour Party if in government ready to face a massive financial crisis without having reserves to bail out the financial system? I see an unavoidable financial crisis that will lead to a tsunami of strikes in 2024 and beyond. 

 Best regards

Karl Hohenstauffen

Britain is facing the dangers of a prolongued General Strike combined with financial meltdown

Britain is facing the dangers of a prolongued General Strike combined with financial meltdown

The end of the Lockdown will unleash the law of unintended consequences. For example, for education to go back to normal timetables, two conditions must be met. You need to have enough teachers willing to return to the classrooms and enough parents must be willing to send back their children to full-time education.

At the moment, none of the said conditions seem to be about to be met. Trade Unions have stated that they are reluctant to tell their members to go back to work in conditions deemed to be unsafe. Surveyed parents have indicated that they don't want their children back in school for fear of infection.

As long as the Lockdown goes, teachers' salaries continue to be paid. How long will teachers' salaries continue to be paid if the authorities decide that all schools must return to normal timetables and teachers don't show up? Will parents be forced to send their children to school? Will those who don't be penalised?

Normality in terms of school attendance has a direct impact on working families. Parents could not go back to work as normal if their children are not in full time education. In principle, the furlogh scheme will only last until October 31st 2020 when many - perhaps millions - will find out if they still have got a job. 

People without income cannot pay for mortages and loans. We could witness a massive Northern Rock effect. To the number of companies that have already gone under will be added the number of those who have gone under that we still don't know about.

This will happen at a time when the state is already involved in unpredented levels of borrowing to finance the furlogh scheme and other emergency funding. If as a direct result of the present predicament, the financial sector falters, there is no money in the kitty to rescue the financial sector and at the same time pay for mass unemployment.