Quote:
Originally Posted by Nidge41
We've got more debt than Greece which scares the brown stuff out of me.
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We have our own currency, and therefore full control over our monetary policy, which Greece does not.
The video played fast and loose with its explanation of government bonds (a.k.a. "Gilts"), referring to their "interest rates", which implies they are loans in the sense we understand them domestically, which they are not. It also chose to contrast the eye-watering gilt yields of the early 1980s, which are pretty much a worst case scenario in our modern history, with the yields of today, as if that were enough to prove things are about to get worse.
The fact is, lenders know the state of the British economy and the gilt yields the British government is able to secure are a reflection of the perceived soundness of the economy and the way it is being managed. Those yields are not going to spike a la Greece as a result of any of the data in that Moneyweek video, precisely because all the information in that video is already a matter of public record and is taken into account when lenders bid for government bonds.