Gordon Brown, the Destroyer of our Economy

Inescapably responsible
Calamity Brown

The Cobden Centre’s Chairman, Toby Baxendale, explores Gordon Brown’s total responsibility for the meltdown of the UK economy.

It is said that the USA Sub Prime mortgage market — i.e. mortgages sold to people who had less chance of repaying the debt than the lender would normally lend to — is the cause of the Recession. How did the lenders get this money to lend to the less than creditworthy borrower?

From 1996 – 2007 in the USA, there was a spectacular increase in the money supply and thus credit grew from $5 trillion to $10 trillion, a frightening  double increase in circulating money, if you take the M3 measure.

It is said by our Prime Minister that the bursting of this American bubble and the loss of confidence in the capital markets across the world is nothing to do with the UK Government’s policies, indeed “its not my fault .”

Like a school boy caught doing something wrong the Prime Minister says “its nothing to do with me, it was him, him and him”, i.e. anyone but himself. How can what happens in the USA cause anything to happen in the UK?

If you think about it, in the USA, you have a currency that is called the Dollar that is legal tender. In the UK you have something called the Pound Sterling that is legal tender.

Now for any dollar-based dodgy mortgage security, denominated in dollars, to be sold to a UK financial institution, such as one of our formally Great Banks, the bank must sell Sterling and buy dollars to pay for the security.

Under our Chancellor from 1997 – 2007 and now Prime Minister during this period, we have seen the money supply grow from £700 billion to £2 trillion if you take M4 as the leading indicator: such a massive increase in the circulating credit in the economy is un heard of in all our history!

Only armed with excess Sterling — newly minted money — can a bank consider buying sub-prime mortgages.

These schemes would never have been considered in normal markets as you place your loans, as a banker, in the strongest, most secure deals first and you avoid placing your clients’ money at risk if your clients’ money is scarce.  If it is plentiful and you have run out of conventionally sound investments, you then look at the more risky investments.

Only the then Chancellor and now Prime Minister could have allowed such excesses to develop. He and he alone is the person who could have not printed the money and not allowed the excess credit creation.

The Smoking Gun is in his hand.

The destruction he and he alone has caused effects the lives on untold millions of people around our country as we now have:

  • Short-time working hours,
  • Layoffs, redundancies,
  • Mass unemployment and invalidity,
  • Large-scale reduction in the values of retirement pensions: people having to work longer to stay still,
  • A collective 30% pay cut verses other workers in the World, for a full 60 million of us as our currency has shrunk in value against most of the World’s other currencies.
  • More importantly, lets pause a minute and consider this number: £800 billion…….. It is the National Debt for next year that David Cameron will inherit when he is PM. It is more than the collective debts off all the governments collectively rolled together since William the Conqueror!

Madoff got life for blowing away peoples savings. His Ponzi scheme was the largest yet know in history.

Nothing compares with the scale of destruction that Gordon Brown has caused: that lays firmly at his feet and no one else’s.

We have listened to his delusional mumbo jumbo for long enough. If he had any Grace he would resign. I fear he will not go quietly.

I have an image in my mind of the lovely Sarah Brown dragging him from Downing Street with Gordon muttering 5, 6 or 7 new initiatives to combat this, that or the other ailment that He has caused.

She tells him “it’s over Gordon, do not worry, I have booked us a long needed holiday in a nice holiday home in Libya with our new friends!”

Let us then hope the new Administration will not repeat the mistakes of the current one.

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One reply on “Gordon Brown, the Destroyer of our Economy”
  1. says: Steven Baker

    Via the Taxpayers’ Alliance

    Robert Peston interviewed Gordon Brown for last night’s News at Ten, and produced an absolute gem. As the interview wound up, Pesto asked the PM

    Did you worry about the way in which household sector indebtedness was increasing, individuals were borrowing more and more and more?

    To which Gordon replied

    Well, I’ve never been someone who myself has been interested in running up personal debts or borrowing huge amounts of money.

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