I’m really thick when it comes to understanding debt (well, there are a few other things too…).
This site has helped make sense of things for me:
http://www.debtbombshell.com/uk-national-debt.htm
You can see the national trend for debt to rise, due to the interest accrued from dishing out national gilts. This isn’t going to stop.
Russia does well on Oil and Gas reserves. The UK national debt isn’t that bad all things considered.
Its funny that website neglects to mention in its explanation of what caused the debt, the small matter of a £500bn bailout for the bankers incl £50bn direct payout. That is a very Tory website.
the rich are always crying poverty 
Thanks for that ~ I never noticed the cause was absent, nor did I notice that it was a Tory website. Kinda confirms what I feared all along …
when it comes to understanding national debt, I’m just thick 
eh?
http://www.debtbombshell.com/measuring-national-debt.htm :
*Bank bailouts
The Treasury have made some provision in their forecasts for the losses we’re likely to make on the bank bailouts. As of April 2009, unrealised losses from financial sector interventions account for £134.5 billion of the national debt. Northern Rock and Bradford & Bingley account for £123 billion, with a further £9 billion going to compensate depositors with the Dunfermline Building Society.
If this wasn’t bad enough, the picture is going to get considerably worse. The Office of National Statistics has classified the Royal Bank of Scotland and Lloyds as public corporations but hasn’t yet included their liabilities in the national debt. When they finally crunch the numbers, expect the results to be ugly. According to EU figures, Britain has pledged £781.2 billion in capital injections, liability guarantees and liquidity support to the banking system. As taxpayers, we’re on the hook for any losses.*
Thanks Pat. As you probably guessed I only got as far as the first page “Budget Deficit” and that made no mention of the bank bailout, which seems to me very odd indeed
& it’s us that will end up paying for it if the Tory-Libs get their way. Notice how they are rewriting history by blaming public sector spending/profligacy instead of the bankers??
The money has already been borrowed by previous govts & it’s got our name on the IOUs, it makes no odds who’s in govt now we’ve still got to pay it back.
Interesting article that explains how, despite the overall debt we’ve recently built up, we’re not in quite such a shakey situation as many of our European counterparts, at least in the short term:
Taking the view of one (US economy) analyst, devaluing the currency to 5% of its present value would get them out of the hole. That would be £20 becoming one new pound, for us. Assuming we were alone in devaluing, the only impact it would have would be to make imports 20x as expensive. Everyone would have to ride a Triumph.
Very interesting article, thanks for posting that, Pat.
As anyone with a mortgage knows, it is not what you owe, but whether you can find the money when the payments are due.
How many of the journalists and politicians saying it is terrible that the UK owes 78% of GDP etc have mortgages that are three or four times their salary?
Certainly not David Cameron, he’s apparently worth some £30m :w00t:
You gotta love the Russians
I don’t know that much about the economy but who do we actually owe money to? *Other countries? *
In the main it will be bankers, insurance companies and pension funds.
Where do these guys live then? Other countries? I thought government and establishment were as high as it gets? So we owe money to private banks within our own country then?
A lot of it is held in Government bonds which were bought by overseas Governments and funds. A bond is an IOU which also pays interest at a guaranteed rate. UK bonds have always been attractive because of our AAA credit rating (we as a country have never defaulted on a repayment) and the relative stability of sterling. It’s a good way for the Govt to borrow money at reasonable rates. (Reasonable until you borrow so much that the interest payments are equalling what you spend on education each year !)
The bond owners have no say in how the country is run, they just get their money back at a future date with a bit of interest.
Interesting.