The simple truth is UK financial system is screwed.
If interest rates were at their historically ‘normal’ rate of 5% — instead of the all-time low of 0.5% they’re at right now — there’s absolutely no way Britain could ever repay its debts.
In fact, at normal rates of interest UK is already bust. Not just ‘in over our heads’ but six feet under.
It’s simple maths. If interest rates moved back towards the normal 5% level, our cost of borrowing would triple.
Just to put that into context, if our current debt repayments tripled, the government would have to take drastic action — like abolishing the state pension. Or privatizing the NHS. Or pushing tax rates back up to 90%, as they were in the 1960s.
In short, Britain would change radically.
And that’s just if interest rates move back to ‘normal’ levels.
Now you are probably thinking ‘there’s no way the Bank of England or the government would let this happen’. You think they’d act to prevent it.
You are right. They are about to act. They are considering abolishing your cash to keep a tight control on your money.
UK citizens may not think of themselves as an extreme economy like Argentina. Or Cyprus. Or Greece. But the reality of it is: IT’S the same.
In fact, UK has borrowed far more than any of those nations. The perception is that UK economy is too important. That Britain is too big to fail.
Don’t believe it.
What you are about to see is the end-game of Britain’s colossal accumulation of debt. And it is a ticking time bomb.
In this scenario, debt is the gunpowder… it has made our entire system prone to combustion.
Interest rates are the spark that will set the whole thing off.
Those in charge of the financial system know it.
They will do everything they can to delay the explosion of Britain’s debt bomb.
And that’s why they could be on the verge of implementing draconian measures:
Total control of your money.