The UK has run a national debt for most of the last 300 years to fund wars, beginning in the 1690s. Debt has reached peaks above 200% of GDP after major wars. It reached roughly 250% of GDP in 1946–47 following World War II. Debt-to-GDP fell steadily from the 1950s, reaching a low of 24% in 1991–92.
The Bank of England was founded specifically to manage a £1.2 million loan to the government.brief periods of budget surpluses—years where it earned more than it spent, under both Thatcher's & Blair's governments. We used to have significant gold reserves. Not now. More than half was sold off at historically low prices between 1999 & 2002. Personally that seems to me a major financial mistake.
I wouldn't run my personal life on the basis of FD & QE, so am at a loss to understand the massive debt we have got ourselves in. So who pays the price of all this - taxpayers, users of services & future generations. In other words you & me & our children & grandchildren. A significant portion of the debt is owned by UK pension funds, insurance companies, and banks, meaning the state owes the debt to people in the UK. Outcomes include rising costs & inflation.
Is the UK bankrupt? Well some say yes & some say no. Some commentators highlight the risk of a "sovereign debt crisis" or "running out of money. Others argue a sovereign nation issuing its own currency cannot go bankrupt. Personally I can only relate all of this to my situation & it doesn't stack up. Politicians & financiers deliberately use euphemisms & obscure language to confuse & obfusticate. If they told us the truth in plain English I might believe they knew what they were doing. So I'm deeply cynical.
If we can only keep going by borrowing more are we bankrupt? I won't be paying the price, but my Grandchildren will. So will yours.
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