@Bill



That all sounds reasonable, however the private debt was enabled by poor guvtn regulation and inherent conflict in policy. My recollection, which could be mistaken by now, is that in circa 2005 there was a conference in Canada where treasury or BoE staff, can't remeber whichS were directly challenged about the conflict between the desire to maintain low interest rates to avoid sterling strengthening and thereby decimating UK manufacturing, and the heating up of the UK housing market on the back of the same low interest rates. There was a nonsensical reply but the basic conflict was acknowledged



Shortly after that I was talking to a regional manager of one of the big banks who said he had just had to turn down a mortgage application from a flyboy who then just shrugged his shouders and said he would fill in a self cert form with am overseas bank, no problem. In short mortgages should be controlled as a consumer product and they were not. That was a regulation failure. HMG at the time where only too happy with the bubble blowing, circa 2007 an MP was reported as saying the income tax on bankers bonuses on its own was enough to fund the school refurb / rebuild programme and without it there would be no refurb programme. More of the same mentality was shown when Blair or Brown, again I cant remember which one, wanted to double stamp tax, one stamp on sale and one on purchase of the same sale event. Balls was spending mioney like there was no tomorrow



Brown or one of his staff, again from memory, said that it was never the guvnts practice to comment on the housing market, a thoroughly inane comment. Balls I believe it was who showed his accumen in the Baby P case by saying he had authority but not responsiblity, more inane thinking, if you are in authority you have responsibility. Brown again showed his entire lack of reality by launching a child trust package in which it was advised Joe Public should put the 200quid in the stock market, a matter of months before the FTSE dropped like a brick. Finger on the pulse, not



Whilst you are technically correct to say the ramping up of public debt did not occur till post 2008 the catalyst was truely appalling guvnt mismanagement. It is not as though the signals were missing, up to about 2000 domestic saving and borrowing was broadly in balance, progressively from that point on the inflow of funds from overseas by various routes ramped up and up and up with one main destination - the housing market. This was blatent market manipulation and as far as I am concerned the manipulation continues as a significant fall in housing values would move colossal sums to the banks at risk ledger



Tax revenues coninue to a be a honey trap for HMG, for example Stamp duty on house sales from London alone in 2015 exceeded alcohol and beverage tax revenue for the whole of the UK



If you look at sustainable housing price assessment criteria, which I havent done for some time, chances are you will find most of the Western world remains locked in unsustainable housing prices, that is not an accident and it is a direct result of a lack of guvnt regulation. Western housing was the main destination of loose cash, mainly from the Far East



So we have guvnt part of the bubble, guvnt debt ramping up following 2008, and the solution is more debt to prop up the show when the real issue is housing returning to realistic levels which guvnt clearly has no desire to see anytime soon otherwise a mass building programme would have been initated and if necessary building land seized from land banks by compulsory purchase. If you can compulsory purchase for a railway you can do it for housing need



You have an unearned wealth transfer to the older quartile based on massive long term debt taken by the younger generation. The objective therefore has to be to engage inflation to destroy that debt. The problem with the debt proposal you make is for it to be viable interest rates have to be low, when debt destruction demands inflation is high and therefore interest rates are high. So I am sorry but I am unconvinced by your argument. I am also unconvinced by the idea that you recognise debt when it comes out of the closet, the issue there is the recognition of latent debt which preceeds its closet exit



And in case you think I am some Conservative supporter I am not, it is simply Nu Labour took idiocy to a new level