Is Britain to Collapse Next?

Iceland had a financial meltdown recently, the first “Western” “democracy” and “market economy” to do so since 1974. Could the same fate befall its near neighbor small island nation, Britain?

Yes it could — and probably will rather sooner than later. Here are the raw facts: as regards aggregated private and public debt, Iceland’s debt-to-GDP ratio at the time of collapse was 900%. Britain’s debt-to-GDP ratio has now reached 500% (including the Northern Rock bailout) which is second only to Iceland and Zimbabwe. Its currency has fallen by 30% both against the dollar and the euro. What’s more, Britain’s unelected PM Brown (stuck in the cloud Cuckoo land) is hoping to “kick-start” the economy by borrowing even more to enable the British government to cut taxes (at least in the short term). While kick-starting the British economy, he should be really careful lest he kicks it to death — so weak and unhealthy it really is. Anyhow, the telltale ratio is all set to rise further in the very near future — if there is any future, that is.

The difference between the Iceland and Britain collapse scenarios is that Britain does have a substantial tax base and is a major top-ten economy. But even that tax base is mainly founded on service sector jobs — and such jobs could go very fast if the current crisis is not over soon, to say nothing of the fact that they don’t create real wealth but merely redistribute what is already there.

In view of the above, the verdict is that Britain’s economy is more likely to collapse during the current crisis rather than during the next one.

But perhaps Britain’s collapse won’t be such a shock to the United States. In fact, it could be a blessing in disguise as a crippled Britain will have to forget — at least for a while — about its backstabbing and bitching antics viz-a-viz the USA. It generally will be a monkey off America’s back. The fewer allies, the better (especially if allies are like Britain).

Anyway it is time to be prudent and to take investments out of Britain.

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One Response to “Is Britain to Collapse Next?”

  1. Mike Harmon Says:

    Well said… Great information, keep up the great work!

    Like

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