Is Britain Going Bankrupt?

Daily Telegraph (UK) ^ | Nov 24, 2008 | Ambrose Evans-Pritchard

[PotatoHeadMick]

The bond vigilantes are restive.

We are not yet facing a replay of the 1970s 'Gilts Strike', but we are not that far off either.

There is now a palpable fear that global investors may start to shun British debt as the budget deficit rockets to £118bn -- 8pc GDP -- or charge a much higher price for to cover default risk.

The cost of insuring against the bankruptcy of the British state has broken out -- upwards -- over the last month. Yes, credit default swaps (CDS) are dodgy instruments, but they are the best stress barometer that we have.

Today they reached 86 basis points, near Portuguese debt in the league table. For good reason. Alistair Darling has had to admit that the British economy faces the most sudden economic collapse since World War Two, and the worst budget deficit of any major country in the world.

Ok, this is a lot lower than Iceland, Ukraine, Hungary, and other clients of the IMF, but is significantly higher than Germany (35), USA (43), and France (49).

[PotatoHeadMick]

As one commentator put it, "what do you mean 'going'?".

[mysterio]

We should nationalize Britain. Somebody call Ben and tell him to print some dough for them.

[max americana]

>We should nationalize Britain.

WHY? We already kicked them out more than 230 years ago...

[Ken H]

The cost of insuring against the bankruptcy of the British state has broken out -- upwards -- over the last month.

Who insures the sovereign debt of a country the size of the UK?

[tubebender]

I’m thinking we could trade some tobacco and call them a colony...

[max americana]

Good idea :) Don’t they owe us Canada?

[tubebender]

If we are not going to drill off our coast then we should invade Canada and nationalize their oil and gas fields

[DB]

Just whip some more dollars up from the presses...

And down, down they go...

[Leisler]

No, they extract good and we need that stuff. If we took over the lefty greenies would shut them down and we would both be porked as countries.

[enduserindy]

We should take this as the serious warning it is. Our disappearing manufacturing base, stopping illegal immigration and producing domestic energy are the only solutions. We are tipping in an old direction but this time with “no hands.”

[mysterio]

Yep, outsourcing was a big failure. And so was importing most of our energy.

We should be making goods here. We should be harvesting energy here.

[ggekko60506]

I have better idea privatize Britain: sell it to the Disney Corporation.

Disney could turn the entire country into a “Middlemarch” theme park.

[biff]

“We should nationalize Britain”

Hell no, they drive on the wrong side of the road!!!

[blam]

"I have better idea privatize Britain: sell it to the Disney Corporation."

Maybe even move Stonehenge to Arizona...out there with that bridge, huh?

[ggekko60506]

“Maybe even move Stonehenge to Arizona...out there with that bridge, huh?”

Something like that.

Think of the glitter of the concept. The UK now largely subsists on tourism and finance. With the financial sector going into a prolonged slump converting the entire country into a theme park would work very nicely.

Disney would undoubtedly want outsource the National Health Service, however.