Re: How do cutbacks save economies? : Fri Oct 12, 2012 12:51 pm  

We make so little, these days, that we import most of what we buy (in terms of clothes etc – and, indeed, food). Which is a huge part of what is messing up the balance of payments, as we export much less.

If you can export a service – fine. But most cannot be exported.

Similarly, if we manufactured/produced stuff here – and sold it here, that would have a positive impact on the balance of payments.

[DaveO]

Re: How do cutbacks save economies? : Fri Oct 12, 2012 1:06 pm  

Richie wrote:

We are both manufacturer and data centre provider. One method counts as a product sale, and one as a service sale.
In fact the client could also lease the server from us in which case we've sold a service, or buy and lease via a financing company (which may be part of my company of may be external) in which case we've sold a product, to a financing company.

If you had to build the server whether you run it on your clients behalf, lease it to them or sell it to them you are a manufacturer. In you buy the server to then sell on, lease or use in your data centre on your clients behalf then you are a service provider. The fact your accounts department may class you running a server you manufactured for your client as a service sale is semantics. It is who built it that counts.

The point is that there seems to be a view that a service based economy isn't as real as a product based manufacturing economy, when in reality service and product aren't necessarily that different.

If you don't build the servers (in your example) and say bought them in from a manufacturer in the USA then it definitely isn't as real.

Re: How do cutbacks save economies? : Fri Oct 12, 2012 1:11 pm  

DaveO wrote:

If you had to build the server whether you run it on your clients behalf, lease it to them or sell it to them you are a manufacturer. In you buy the server to then sell on, lease or use in your data centre on your clients behalf then you are a service provider. The fact your accounts department may class you running a server you manufactured for your client as a service sale is semantics. It is who built it that counts.

If you don't build the servers (in your example) and say bought them in from a manufacturer in the USA then it definitely isn't as real.

If we sell that server as a service, then in the whole wrap up of "what is the UK economy" then it counts as a service. Even though in both cases we have built a server and it's utilised in the same way, just charged differently.

Re: How do cutbacks save economies? : Fri Oct 12, 2012 5:12 pm  

Mintball wrote:

And don't decry farming: why not? Why not improve our own food production and security, eh?

But y'see, your little knee is playing those jerkery games so you're not reading all of what I have posted. Either that or you have comprehension difficulties.

I have said, the economy needs rebalancing. At present, 75% depends on people purchasing services or goods.

We need to start creating things and selling them – preferably including actually exporting them.

This does not happen overnight – and indeed, I'm still waiting for details of the product that can be designed, created and a market found for it overnight.

So in the meantime, while that process is happening, we need to create jobs – or the recession will continue, there will be no growth and the deficit will increase. Do you not understand that?

i've read everything you posted, still you carry on with the patronising 'i know so much than you' tack, that so many round here seem to buy into.

so, are we training everyone to install insulation or be farmers now? why not plumbers, they all earn 100k don't they?

just a few quick questions. when we've trained up all these home insulators, the ones who are rubbish at it, they fall through the ceilings and stuff like that, what happens when they can't get any work? then you've got those already doing this job who suddenly see their income drop as more flood the market, do we dole out the money to them too?

we're in recession and the deficit is actually decreasing. thought you might know that, or is it 'comprehension difficulties'?

it's good that you want to just magic jobs from thin air, you should really tell important people that.

Re: How do cutbacks save economies? : Fri Oct 12, 2012 6:09 pm  

samwire wrote:

... Another post of utter, ncomprehending tripe ....

I know - go and invest in some education. The amount you'll have to spend will have us out of recession and the deficit paid off in no time.

I may reply in detail later, but it's probably pointless in terms of your willingness/ability to comprehend the issues - but then I don't mind a touch of masochism.

Re: How do cutbacks save economies? : Fri Oct 12, 2012 6:14 pm  

samwire wrote:

we're in recession

We are, a double dip one when the last government had us on the up turn.

samwire wrote:

and the deficit is actually decreasing.

You may want to check that.

Re: How do cutbacks save economies? : Fri Oct 12, 2012 6:18 pm  

samwire wrote:

oh, so we're not just training them to bung some insulation in. they're going to be designing and fitting windows as well. will the polymer science training be just as quick as the installing insulation training? and there's the new glass technology that these poor buggers will be developing too.

You're making a bit of a fool out of yourself now.

[Kosh]

Re: How do cutbacks save economies? : Fri Oct 12, 2012 8:42 pm  

JerryChicken wrote:

You're making a bit of a fool out of yourself now.

A bit?

[DaveO]

Re: How do cutbacks save economies? : Sat Oct 13, 2012 1:39 am  

Richie wrote:

If we sell that server as a service, then in the whole wrap up of "what is the UK economy" then it counts as a service. Even though in both cases we have built a server and it's utilised in the same way, just charged differently.

That is the point. It's charged differently. How you charge for it doesn't alter whether you are a manufacturer or a service company. If BMW only leased their cars as opposed to selling them they would not become a service company. They would still be manufacturing the cars.

I suspect though that your company doesn't actually manufacture anything. It just plugs components manufactured by other companies together to make a server. That is not the same thing as manufacturing.

Re: How do cutbacks save economies? : Sat Oct 13, 2012 7:23 am  

samwire wrote: just a few quick questions. when we've trained up all these home insulators, the ones who are rubbish at it, they fall through the ceilings and stuff like that, what happens when they can't get any work? then you've got those already doing this job who suddenly see their income drop as more flood the market, do we dole out the money to them too? Here's a way to spend our way out of recession. Government, local and national, "own" thousands of hectares of land suitable for housing development (I say "own" but in reality they are only custodians of what belongs to us, the nation). If this land was leased at peppercorn rents to charities and other not-for-profit organisations, they could then attract the necessary investment from institutional investors, like insurance companies and pension funds, to cover the cost of building much needed housing. Remember, there is a very real shortage of truly "affordable" housing. The cost of construction (labour and materials), of a new house is around 40% of the final value, the balance being the cost of the land itself. These houses could then be rented out at truly affordable rents of 50% of the prevailing rate. The institutional investors would see a far better return on their capital than if they invested in government bonds and with a 99 year lease, they would also have similar or better security as if they'd invested in gilts. These houses should carry a cast-iron convenant that prevents any future "right to buy" schemes, they and the land they sit upon should remain mutually owned. Quite apart from mitigating the housing shortage, the knock-on effects would be an increase in direct labour for construction and provision of infrastructure, this then feeds into increased employment in industries supplying construction, such as brick-making, timber, plumbing, electrical equipment etc. Each new home will also require to be furnished and carpeted, so more people employed in manufacturing and selling these items. As each new person comes off the dole and into employment, the exchequer wins by not having to pay benefits and hopefully (depending on their wage), gaining tax & NI receipts. As each new home is rented, at these truly affordable rents, the exchequer also gains by reducing the amount of housing benefit paid. It's also worth pointing out that it is not the claimant who benefits from HB payments, it is his (invariably private), landlord. Privately-owned rented properties would also see reductions in revenues as "the market" drives down private rents to match those of the mutual-property rents. Of course there will be losers: The way UK banks are currently structured, they view 25 year mortgages as long term, so they'd probably lose out to institutional investors or foreign banks (who are not averse to long-term investment). Private landlords would see a reduction in their rent receipts, as would the letting agents who leech off the back of them. But I strongly contend that th overall benefits to the nation far outweigh these "problems". The only thing preventing this happening is dogmatic ideology, not surprising when you look at the number of MPs who are buy-to-let landlords and the influence on those same MPs of the financial sector. Instead, we now see proposals to convert "social housing" to "affordable housing". You may think there's little difference between the two but THIS LINK shows that there is a very real difference and you have to wonder at the mentality of raising rents from "social" to "affordable" and basically funding the difference through housing benefit. That's the politics and economics of the madhouse.

samwire wrote: just a few quick questions. when we've trained up all these home insulators, the ones who are rubbish at it, they fall through the ceilings and stuff like that, what happens when they can't get any work? then you've got those already doing this job who suddenly see their income drop as more flood the market, do we dole out the money to them too? Here's a way to spend our way out of recession. Government, local and national, "own" thousands of hectares of land suitable for housing development (I say "own" but in reality they are only custodians of what belongs to us, the nation). If this land was leased at peppercorn rents to charities and other not-for-profit organisations, they could then attract the necessary investment from institutional investors, like insurance companies and pension funds, to cover the cost of building much needed housing. Remember, there is a very real shortage of truly "affordable" housing. The cost of construction (labour and materials), of a new house is around 40% of the final value, the balance being the cost of the land itself. These houses could then be rented out at truly affordable rents of 50% of the prevailing rate. The institutional investors would see a far better return on their capital than if they invested in government bonds and with a 99 year lease, they would also have similar or better security as if they'd invested in gilts. These houses should carry a cast-iron convenant that prevents any future "right to buy" schemes, they and the land they sit upon should remain mutually owned. Quite apart from mitigating the housing shortage, the knock-on effects would be an increase in direct labour for construction and provision of infrastructure, this then feeds into increased employment in industries supplying construction, such as brick-making, timber, plumbing, electrical equipment etc. Each new home will also require to be furnished and carpeted, so more people employed in manufacturing and selling these items. As each new person comes off the dole and into employment, the exchequer wins by not having to pay benefits and hopefully (depending on their wage), gaining tax & NI receipts. As each new home is rented, at these truly affordable rents, the exchequer also gains by reducing the amount of housing benefit paid. It's also worth pointing out that it is not the claimant who benefits from HB payments, it is his (invariably private), landlord. Privately-owned rented properties would also see reductions in revenues as "the market" drives down private rents to match those of the mutual-property rents. Of course there will be losers: The way UK banks are currently structured, they view 25 year mortgages as long term, so they'd probably lose out to institutional investors or foreign banks (who are not averse to long-term investment). Private landlords would see a reduction in their rent receipts, as would the letting agents who leech off the back of them. But I strongly contend that th overall benefits to the nation far outweigh these "problems". The only thing preventing this happening is dogmatic ideology, not surprising when you look at the number of MPs who are buy-to-let landlords and the influence on those same MPs of the financial sector. Instead, we now see proposals to convert "social housing" to "affordable housing". You may think there's little difference between the two but THIS LINK shows that there is a very real difference and you have to wonder at the mentality of raising rents from "social" to "affordable" and basically funding the difference through housing benefit. That's the politics and economics of the madhouse.