Must be two schools of thought amongst Tory MPs Those who actively want this nonsense Those who assumed Truss would be a touch looser fiscally than Sunak but might have half an eye on keeping Britain solvent.
Most likely thing is Truss sets out a plan to keep Britain solvent in the next few days and submits to the OBR, and others, for scrutiny.
But, she's also very obstinate and probably thinks the markets are wrong so I wouldn't bet on that.
Having created a crisis she will now use it to justify spending cuts, to balance the books. Since the financial markets concern is with the deficit, rather than overall policy, of the spending cuts plan is remotely credible it would calm the markets.
It would also calm Tory backbenchers. They might, in extremis, be prepared to rebel to prevent British bankruptcy, but few of them went into politics to defend high levels of public spending.
I think this is possibly all a deliberate political ploy, on the basis that they correctly judged it would be easier to sell spending cuts as a solution to a government debt crisis, than as a way to enable tax cuts.
Yes, othes have suggested this a re-run of Republican ideological policies. This is also one of the only ways that ideological and financial backers of the Tories would be satisfied at the same time ; ideological backers like the IEA would be delighted with spending cuts on a huge scale, and financial and Brexit backers like Odey would simultaneously continue to make huge profits from dramatic market movements, all at national expense obviously.
Tumbling gas prices on track to slash £60bn cost of energy bailout Successful efforts to fill gas storage could halve prices by early next year
Britain's energy bills freeze could prove much less costly than feared by early next year, as City forecasters predict that gas prices will plunge this winter following a successful scramble across Europe to fill reserves.
A halving in gas prices in the coming months would push average household bills below the £2,500 limit set by the Government’s Energy Price Guarantee, slashing the cost of the intervention, according to estimates by Deutsche Bank. https://www.telegraph.co.uk/business/2022/09/25/tumbling-gas-prices-track-slash-60bn- cost-energy-bailout/ (£££)
If only this site has someone who has been pointing at the gas futures price and querying the alleged costs.
Wait until we're through the winter. Germany has bought much if its gas, as it has the storage; we still have much of ours to buy. It probably will work out better than the more pessimistic forecasts, but we don't yet know.
It’s ok. The Chancellor said yesterday that he doesn’t comment on market movements. And we have no published forecasts (in the absence of a view on what Govt is trying to achieve) underpinning the Govt’s plans.
His skill is not in policy-making or in vision-dreaming, but rather in a kind of stolid mediation or arbitration.
We can already see that the Starmer years will be reasonably dull, and the far left will be disappointed, but the country will be fairer and more content.
He and Labour need to make sure he is surrounded by a top-notch team, but I find the current Labour front bench the most impressive they’ve had since the Blair years.
I think his campaign will be dull, vacuous and worthy, but he would have the skills to manage a coalition well. Something that Corbyn never could have done when he was way short of a majority in 2017. That gives Starmer quite the edge.
On topic, I cannot see the Tories dumping Truss before a GE. For better or worse they are stuck with her. No comeback for Johnson, indeed likely to ignominiously lose his own seat at that GE.
On topic of your on topic, all of a sudden I am not so sure - the herd have got a taste for moving, if Truss was hollowed out by awful polls, elections, scandals - for example as a betting site how many weeks do we think Fulbrook rides this situation before resigning - one more scandal on top and the herd will move, only this time no phase 2 members element. The bookies would make Wallace favourite once Truss is ousted, I agree with HY, if Truss goes Wallace with lead the Conservatives into the election - except for one doubt, he’s not that many weeks ago ruled himself out, why does that change?
I would have it 50/50 Wallace or Truss leading Tories into next election. Just 2 weeks in and she would already lose a vonc. Six months of awful polling and she’s out.
1. It is far too early to say Truss is a failure. 2. Boris is not coming back.
“ It is far too early to say Truss is a failure. ‘
Too early to know the final score, but like a football team four down at half time and playing confused disjointed stuff, you can reasonably accurately predict how it ends up.
Six months of dire polling, slipping into 20s, then to mid 20s, and Truss is voncked. Gone. Yeah. I think we can reasonably predict that already.
Your second point. Fact is, If Boris had blagged himself into the contest like Corbyn had done when voncked, Boris would still be there is the truth of both the MPs picking top 2 and the membership vote that just happened. Instead of resigning he should have cut a deal as vonc winner to be allowed in contest. As Mike and the evidence in the header should educate you, Boris hasn’t gone away you know. Given a straight choice between Boris economics and Trump economics, the Tory Party would chose the former today let alone after six months of chaos and horrid polls.
She has already chosen the arena she wants to fight in, 'growth', and unceremoniously hauled Starmer into it. I see she has also managed to get him to swallow most of Kwasi's mini-budget. This is within a week of politics proper. Let's delay the post mortem shall we?
Starmer and Labour have been banging on about growth as the financial answer, as indeed have the last few Tory governments. It is the magic money tree that everyone wants to harvest but no one can find.
No budget is instantly met with a policy to reverse it, not least because there needs to be time to understand its effects, and no one writes a budget 2 years into the future.
So what you are saying is that (a) the tax policies of the last few years have failed to deliver growth; (b) therefore we should continue them
Ironically, that is just what LizT and Kwasi are saying about Corporation Tax in cancelling Rishi's planned changes.
Must be two schools of thought amongst Tory MPs Those who actively want this nonsense Those who assumed Truss would be a touch looser fiscally than Sunak but might have half an eye on keeping Britain solvent.
Most likely thing is Truss sets out a plan to keep Britain solvent in the next few days and submits to the OBR, and others, for scrutiny.
But, she's also very obstinate and probably thinks the markets are wrong so I wouldn't bet on that.
Having created a crisis she will now use it to justify spending cuts, to balance the books. Since the financial markets concern is with the deficit, rather than overall policy, of the spending cuts plan is remotely credible it would calm the markets.
It would also calm Tory backbenchers. They might, in extremis, be prepared to rebel to prevent British bankruptcy, but few of them went into politics to defend high levels of public spending.
I think this is possibly all a deliberate political ploy, on the basis that they correctly judged it would be easier to sell spending cuts as a solution to a government debt crisis, than as a way to enable tax cuts.
Though if today's Times is to believed, the spending review has been put off until after the next election.
Macron's party came from nowhere and is very much a "president's party", whereas Meloni, although she fits into the mould of female, non-elite background, far right wing, racist demagogue (cf. Pauline Hanson), is in effect the leader of an established party that goes back to Benito Mussolini and has had a few changes of policy and name through the decades. The flaming tricolour logo is MSI all the way, right down to the red twiddle at the top.
I'm told the way she uses the term "gender" is very "Opus".
How is she planning to do that? My understanding of the low fertility rate there is that it is due to female education, and limited economic opportunities for the young.
As well as giving more financial support to mothers with children with paid state maternity leave, lower taxes on married couples with children and free kindergartens open for longer, Meloni is a supporter of keeping abortion restricted beyond 90 days and takes a traditional view on the family and sexuality
So greatly increased social security spend on mothers and children? Doesn't seem to match the "far right" tag
Fascists love going on about the need for high fertility in the favoured ethnic group, and they support state spending to encourage it.
* Battle for Births (Fascist Italy). * "A nation without a children is a nation without a future". (Ustashist Croatia). * The famous "14 words" so beloved of white supremacists in the US and elsewhere. * Etc. etc.
Fascists are collectivists, not individualists or libertarians.
Women's education is another matter.
And when that fails they kidnap large numbers of kids from a neighbouring country?
The primary slogan in the Fourteen Words is "We must secure the existence of our people and a future for white children",[1][5][6][7] followed by the secondary slogan "Because the beauty of the White Aryan woman must not perish from the Earth".
In all seriousness, does Truss genuinely believe she was going to come in and somehow succeed with her approach? She was massively over promoted in cabinet and had nothing to show for it, apart from a few terrible trade deals
I don’t think she has the personality or presence to reassure voters either. There’s just nothing about her
The sinking currency is making the govt energy plan more expensive by the minute
And they’re going to have to pay through the nose to borrow the money to pay for it.
Lets hope the gas price futures crash in the coming weeks.
As I never tire of pointing out, we could have borrowed to fund tidal power lagoons a decade ago, at a cost which is now a tenth that of today's. That infrastructure would have lasted fifty years at a minimum. The economics quite possibly don't stack up now. That's a huge failure of government.
Truss was Chief Sec at the Treasury when the tidal lagoons project was scrapped.
I am very bearish about the practicalities of tidal lagoons, but we've had this discussion many times before on here.
(I really need to go back and re-read the document MM linked to about it and see if I still feel the same way...)
What could possibly go wrong with giving the IT firm responsible for the Post Office scandal - the biggest miscarriage of justice there has ever been - the contract to work on the Police National Computer?
Way back in the mid-1990s, just before 1997 landslide, I saw Blair speak at a Fabian conference and i well remember the buzz as he walked in surrounded by what Mason describes here as "earpiece" people. And a dozen TV cameras. There was a certain light, perhaps from some of the cameras, and an intensity of those surrounding him, that made it seem a profound moment.
Paul Mason @paulmasonnews · 8m 4/ Starmer - confident, surrounded by "earpiece people" - more presidential than prime ministerial. This works for him and unless Truss can generate a similar buzz at her own zombie conference, will start to soften the media towards Labour ...
Hard left wing journo slags off the Tories. Not news.
Indeed, Mason is on the witheringly stupid Corbynista side of the fence. Nonetheless have you not seen the financial news today?
His skill is not in policy-making or in vision-dreaming, but rather in a kind of stolid mediation or arbitration.
We can already see that the Starmer years will be reasonably dull, and the far left will be disappointed, but the country will be fairer and more content.
He and Labour need to make sure he is surrounded by a top-notch team, but I find the current Labour front bench the most impressive they’ve had since the Blair years.
I think his campaign will be dull, vacuous and worthy, but he would have the skills to manage a coalition well. Something that Corbyn never could have done when he was way short of a majority in 2017. That gives Starmer quite the edge.
On topic, I cannot see the Tories dumping Truss before a GE. For better or worse they are stuck with her. No comeback for Johnson, indeed likely to ignominiously lose his own seat at that GE.
On topic of your on topic, all of a sudden I am not so sure - the herd have got a taste for moving, if Truss was hollowed out by awful polls, elections, scandals - for example as a betting site how many weeks do we think Fulbrook rides this situation before resigning - one more scandal on top and the herd will move, only this time no phase 2 members element. The bookies would make Wallace favourite once Truss is ousted, I agree with HY, if Truss goes Wallace with lead the Conservatives into the election - except for one doubt, he’s not that many weeks ago ruled himself out, why does that change?
I would have it 50/50 Wallace or Truss leading Tories into next election. Just 2 weeks in and she would already lose a vonc. Six months of awful polling and she’s out.
1. It is far too early to say Truss is a failure. 2. Boris is not coming back.
“ It is far too early to say Truss is a failure. ‘
Too early to know the final score, but like a football team four down at half time and playing confused disjointed stuff, you can reasonably accurately predict how it ends up.
Six months of dire polling, slipping into 20s, then to mid 20s, and Truss is voncked. Gone. Yeah. I think we can reasonably predict that already.
Your second point. Fact is, If Boris had blagged himself into the contest like Corbyn had done when voncked, Boris would still be there is the truth of both the MPs picking top 2 and the membership vote that just happened. Instead of resigning he should have cut a deal as vonc winner to be allowed in contest. As Mike and the evidence in the header should educate you, Boris hasn’t gone away you know. Given a straight choice between Boris economics and Trump economics, the Tory Party would chose the former today let alone after six months of chaos and horrid polls.
She has already chosen the arena she wants to fight in, 'growth', and unceremoniously hauled Starmer into it. I see she has also managed to get him to swallow most of Kwasi's mini-budget. This is within a week of politics proper. Let's delay the post mortem shall we?
Starmer and Labour have been banging on about growth as the financial answer, as indeed have the last few Tory governments. It is the magic money tree that everyone wants to harvest but no one can find.
No budget is instantly met with a policy to reverse it, not least because there needs to be time to understand its effects, and no one writes a budget 2 years into the future.
So what you are saying is that (a) the tax policies of the last few years have failed to deliver growth; (b) therefore we should continue them
So, what you’re saying is that we need to do something and this (KK’s “budget”) is something, so let’s do it?
What could possibly go wrong with giving the IT firm responsible for the Post Office scandal - the biggest miscarriage of justice there has ever been - the contract to work on the Police National Computer?
Probably nothing given the police currently barely bother to investigate crimes and when they do our courts are in such a mess it isn’t likely the case will come to trial.
I’m starting to wonder which country I should emigrate to.
I suspect that this will be the moment where a Labour government of some form became almost inevitable.
The Tories had one more roll of the dice with Truss and it’s backfired.
In addition Starmer has really stepped up and looks like the next PM in waiting.
I say “almost” because nothing is certain and there is still a very narrow pathway to Tory victory in 2024, but I think that is now shrinkingly narrow.
In all seriousness, does Truss genuinely believe she was going to come in and somehow succeed with her approach? She was massively over promoted in cabinet and had nothing to show for it, apart from a few terrible trade deals
I don’t think she has the personality or presence to reassure voters either. There’s just nothing about her
Truss’s self confidence is her special power. She believes she has a reality distortion field. How else did she manage to get the right wing to support a Remainer, republican, LibDem for Tory leader?
Along with Kwateng, they are above us mere mortals.
I didn't know until the weekend that Odey used to actually employ Kwarteng himself, or how many Truss backers made shorting fortunes on Friday. The employment of Kwarteng was also actually before he was one of the key financial figures in setting up Vote Leave, too, it seems.
According to various sources Odey has pocketed a tidy 145 million in the last couple of days,..
How big is the uncapped bonus on £145 million? Asking for one of Kwasi's friends.
I think there must be a reasonable chance already of an early ouster of Truss and a coronation of Rishi.
IMO, the selectorate will not put an Indian in No.10
They nearly did already.
One of the astonishing things about this fiasco is Truss’s utterly tenuous victory. Barely any Tory MPs supported her to begin with, and she won the membership with the narrowest margin since fuck knows when.
One thing is, I think the parliamentary party can probably ignore the rights of the members with impunity. On the one hand it's a clear breach of contract to deprive them of their rights under the rules to elect new leaders, on the other, the courts are pretty much bound to say It's above our pay grade to say who is Prime Minister.
The membership have chosen the person who has engineered this crisis (not too strong to already call it that) over the person who largely had the markets onside, even after his massive borrowing to get us through Covid.
Frankly, the membership can fuck right off in having any say how we move forward. It is down to MPs. You won't hear of letters going in to Brady because that would just spook the markets There will be co-ordinated moves to put somebody in place who will do what is needed to get the markets onside. Which basically have to be to return to the Rishi budget. Tax rises and all.
This will look like Black Wednesday cubed for the fortunes of the Conservative Party.
I didn't know until the weekend that Odey used to actually employ Kwarteng himself, or how many Truss backers made shorting fortunes on Friday. The employment of Kwarteng was also actually before he was one of the key financial figures in setting up Vote Leave, too, it seems.
According to various sources Odey has pocketed a tidy 145 million in the last couple of days,..
I very much doubt that those who employed Kwarteng, or bankrolled Truss are the only ones who shorted the pound a week ahead of the budget. But the episode smells worse than PPE contracts for ministers mates.
I think there must be a reasonable chance already of an early ouster of Truss and a coronation of Rishi.
IMO, the selectorate will not put an Indian in No.10
They nearly did already.
One of the astonishing things about this fiasco is Truss’s utterly tenuous victory. Barely any Tory MPs supported her to begin with, and she won the membership with the narrowest margin since fuck knows when.
One thing is, I think the parliamentary party can probably ignore the rights of the members with impunity. On the one hand it's a clear breach of contract to deprive them of their rights under the rules to elect new leaders, on the other, the courts are pretty much bound to say It's above our pay grade to say who is Prime Minister.
The membership have chosen the person who has engineered this crisis (not too strong to already call it that) over the person who largely had the markets onside, even after his massive borrowing to get us through Covid.
Frankly, the membership can fuck right off in having any say how we move forward. It is down to MPs. You won't hear of letters going in to Brady because that would just spook the markets There will be co-ordinated moves to put somebody in place who will do what is needed to get the markets onside. Which basically have to be to return to the Rishi budget. Tax rises and all.
This will look like Black Wednesday cubed for the fortunes of the Conservative Party.
Coming to this a bit late, but re the BBC and the funeral.
This was a state funeral paid for by the state ie by us. Ditto the accession councils and all the rest of it. The BBC is funded by those who pay the license fee. This was not a private matter and the BBC was not hired by the RF like some wedding photographer. So the entire film of the occasion is a historic archive not the private property of the monarchy.
I very much hope the BBC (and, if necessary, the government) tell the monarchy to get stuffed if they try to limit access or use. This sort of arrogance is what will do for the monarchy.
Yes and the BBC filmed the funeral and accession council and lying in state live and in full.
However the archive is an entirely different matter, as it was also a funeral of a member of the royal family they get a say on how much of it broadcasters can store and use
Nonsense. If I filmed part of the funeral, that film belongs to me and the RF has no right to determine what I store and how I use it. No different for the BBC.
The RF cannot have their cake and eat it. This was a public historic and state event. The private family part of it was not filmed for the public. The RF have no right to determine what happens to films made of them in the public domain.
HYUFD is convinced, for some reason, that there’s s written contract. Which seems a bit daft to me. The RF will be doing what they always do, which is a mixture of trading on the habitual over-deference of the major broadcasters, and threatening to withhold future access. They should be politely but firmly resisted.
I think it’s more likely than not that there is a written document of some sort - where they can put cameras etc
I'm sure there is. That's not the same thing as a contract which assigns copyright.
I suspect that this will be the moment where a Labour government of some form became almost inevitable.
The Tories had one more roll of the dice with Truss and it’s backfired.
In addition Starmer has really stepped up and looks like the next PM in waiting.
I say “almost” because nothing is certain and there is still a very narrow pathway to Tory victory in 2024, but I think that is now shrinkingly narrow.
National treasure turned National saviour Boris Johnson could put the cat amongst the pigeons. I'm already warming to him after just three weeks of Truss.
What could possibly go wrong with giving the IT firm responsible for the Post Office scandal - the biggest miscarriage of justice there has ever been - the contract to work on the Police National Computer?
Probably nothing given the police currently barely bother to investigate crimes and when they do our courts are in such a mess it isn’t likely the case will come to trial.
I’m starting to wonder which country I should emigrate to.
I didn't know until the weekend that Odey used to actually employ Kwarteng himself, or how many Truss backers made shorting fortunes on Friday. The employment of Kwarteng was also actually before he was one of the key financial figures in setting up Vote Leave, too, it seems.
According to various sources Odey has pocketed a tidy 145 million in the last couple of days,..
I very much doubt that those who employed Kwarteng, or bankrolled Truss are the only ones who shorted the pound a week ahead of the budget. But the episode smells worse than PPE contracts for ministers mates.
What could possibly go wrong with giving the IT firm responsible for the Post Office scandal - the biggest miscarriage of justice there has ever been - the contract to work on the Police National Computer?
To be fair to the government, you can’t award a contract based on existing performance. Presumably all contractors have had to bid and those bids evaluated against each other
(I think it’s an absolutely stupid procurement rule, but there we go)
I think there must be a reasonable chance already of an early ouster of Truss and a coronation of Rishi.
IMO, the selectorate will not put an Indian in No.10
They nearly did already.
One of the astonishing things about this fiasco is Truss’s utterly tenuous victory. Barely any Tory MPs supported her to begin with, and she won the membership with the narrowest margin since fuck knows when.
One thing is, I think the parliamentary party can probably ignore the rights of the members with impunity. On the one hand it's a clear breach of contract to deprive them of their rights under the rules to elect new leaders, on the other, the courts are pretty much bound to say It's above our pay grade to say who is Prime Minister.
VoNC. Out by Friday. Nothing to do with the courts whatsoever. And even if under some far fetched theory the members had rights over who is Tory leader, they have no say in who is Prime Minister.
It's not a far fetched theory, it is basic contract law. And a vonc gets her out, it says nothing about who replaces her.
Is a membership agreement a binding contract? Membership rights change the whole time
In fact, re; the below, according to the Times late in the evening yesterday, it was not only Odey but several other hedge-fund managers who both first backed Truss and then made fortunes shorting the pound at the end of last week.. :
Coming to this a bit late, but re the BBC and the funeral.
This was a state funeral paid for by the state ie by us. Ditto the accession councils and all the rest of it. The BBC is funded by those who pay the license fee. This was not a private matter and the BBC was not hired by the RF like some wedding photographer. So the entire film of the occasion is a historic archive not the private property of the monarchy.
I very much hope the BBC (and, if necessary, the government) tell the monarchy to get stuffed if they try to limit access or use. This sort of arrogance is what will do for the monarchy.
Yes and the BBC filmed the funeral and accession council and lying in state live and in full.
However the archive is an entirely different matter, as it was also a funeral of a member of the royal family they get a say on how much of it broadcasters can store and use
Nonsense. If I filmed part of the funeral, that film belongs to me and the RF has no right to determine what I store and how I use it. No different for the BBC.
The RF cannot have their cake and eat it. This was a public historic and state event. The private family part of it was not filmed for the public. The RF have no right to determine what happens to films made of them in the public domain.
HYUFD is convinced, for some reason, that there’s s written contract. Which seems a bit daft to me. The RF will be doing what they always do, which is a mixture of trading on the habitual over-deference of the major broadcasters, and threatening to withhold future access. They should be politely but firmly resisted.
I think it’s more likely than not that there is a written document of some sort - where they can put cameras etc
I'm sure there is. That's not the same thing as a contract which assigns copyright.
It is clear from the reporting that there is that too (or at least makes explicit provisions about use of material)
This current shit show is brought to you by the people who brought you Brexit. Whose siren songs lured you into voting yourselves and your families poorer. Cynics who sing patriotism whilst shovelling more money into their offshore accounts. The real metropolitan elite.
This is what the Brexiters want, this is a desirable part of the process. Our current woes will be used to entrench more inequality, a smaller, shabbier, privatised to fuck public realm. Shitter services, an ever poorer NHS. The end of the NHS, if they can. Slashing the rules and regulations - that dreadful, stifling red tape - that, in thousands of ways, large and small, make our lives better, cleaner, more pleasant and equitable. But which cost these rich men money, so they must be done away with. Only profit matters.
The supremely rich men are happy that this is happening. They’ll be making money from it somehow, no doubt. They’re happy to watch us little people struggle and worry. It doesn’t bother them, it won’t hurt them. They are like scientists observing an experiment. They only care about themselves, not the UK or the people in it.
Brexit has hollowed out the Tory Party and left you with a rump of lunatics in charge who will cheer on this shitshow. In decades to come we’ll look back at the six years that have brought us to this point - the churn of governments, PMs, ministers, the stupid decisions leading to more stupid decisions, the choice to leave the free market, Johnson’s futile (and now shamelessly abandoned) attempts to somehow make the whole flawed enterprise actually deliver on some of its empty promises, and they will think: What the actual fuck was the UK doing?
I think there must be a reasonable chance already of an early ouster of Truss and a coronation of Rishi.
IMO, the selectorate will not put an Indian in No.10
They nearly did already.
One of the astonishing things about this fiasco is Truss’s utterly tenuous victory. Barely any Tory MPs supported her to begin with, and she won the membership with the narrowest margin since fuck knows when.
One thing is, I think the parliamentary party can probably ignore the rights of the members with impunity. On the one hand it's a clear breach of contract to deprive them of their rights under the rules to elect new leaders, on the other, the courts are pretty much bound to say It's above our pay grade to say who is Prime Minister.
VoNC. Out by Friday. Nothing to do with the courts whatsoever. And even if under some far fetched theory the members had rights over who is Tory leader, they have no say in who is Prime Minister.
It's not a far fetched theory, it is basic contract law. And a vonc gets her out, it says nothing about who replaces her.
Is a membership agreement a binding contract? Membership rights change the whole time
Yes it is. Lots of contracts expressly say their own terms can be modified.
I am wondering what Rishi Sunak is thinking (I told you so..... springs to mind) or is he hovering around the tearooms catching the eye of backbench big hitters.)...the Tory Conf is going to be quite a spectacle, eso if Boris is given a platform
The conference will love all this, they are getting lower taxes after all.
That it seems to have gone down like a bucket of cold sick is immaterial - even Truss is selling her plans as going to work and be popular 'later'.
Capital Economics says Bank of England needs to stabilise the pound and implement "something like a 100bps or 150bps hike in interest rates (to 3.25%/3.75%), perhaps as soon as this morning"
"We’ve entered the part of the currency crisis where psychology takes over. That could mean the markets continue to test the Bank and the pound falls further" warns Paul Dales, @CapEconomics chief UK economist in a note to clients
I am sorry to keep whinging on about it but the current economic situation is a result of us ignoring our trade balance for 30 years. We simply have far less room for manoeuvre now. The rest of the world has put up their savings to buy our assets to fund our profligacy. They call the tunes and Kwasi is off key.
A government which already has an enormous trade deficit simply cannot boost growth with tax cuts and public spending designed to boost consumption. We have run out of capital to draw on. We need to cut consumption, increase taxes, cut government spending and recognise we can’t live beyond our means indefinitely. Exactly the same prescription that the World bank has been inflicting on under capitalised third world countries for decades now.
The market reaction this week was always going to be much more important than the immediate reaction on Friday because the weekend has been a time to look in more detail at the government’s plans and strategy. Whatever our politics, we all have to hope there’s a sustained rebound. If there’s not, it could get very messy very, very quickly.
I can’t see any sign of a rebound. In fact, I expect the pound to go still lower. $0.90 wouldn’t shock me at some point this winter.
Bottom line is, we are importing most of our energy while running an energy intensive economy at a time when energy costs even if they’re going down are at enormous levels. At the same time we’ve disrupted all our traditional trading links. Our balance of payments is a fiasco.
It isn’t just currency speculators. We’re having significant capital outflows. And at the same time, the government has just exploded all rational fiscal policy in favour of some ideologically driven lunacy where even their own claims don’t stand up to a minute’s scrutiny.
Who would put money in the pound under those circumstances? Nobody sensible.
At least Russia has large reserves of gas, even if it is led by a small-cocked Nazi failure.
In all seriousness, does Truss genuinely believe she was going to come in and somehow succeed with her approach? She was massively over promoted in cabinet and had nothing to show for it, apart from a few terrible trade deals
I don’t think she has the personality or presence to reassure voters either. There’s just nothing about her
Even conservative party members must be worried by how things are going. The government's economic policy is pure ideology and self-interest just like the Khmer Rouge in Cambodia in 1976 believed in complete egalitarianism, and the Venezuelan government believes in price controls and denying the scale of its economic crisis.
I do not see how Liz Truss can get through the coming Conservative Party conference with these borrowing plans. She should be ousted shortly after it if Conservative MPs have any sense of economic responsibility left.
What could possibly go wrong with giving the IT firm responsible for the Post Office scandal - the biggest miscarriage of justice there has ever been - the contract to work on the Police National Computer?
Maddening but not surprising. Not too big to fail, but too big to rule out even when they deserve to be.
In all seriousness, does Truss genuinely believe she was going to come in and somehow succeed with her approach? She was massively over promoted in cabinet and had nothing to show for it, apart from a few terrible trade deals
I don’t think she has the personality or presence to reassure voters either. There’s just nothing about her
Even conservative party members must be worried by how things are going. The government's economic policy is pure ideology and self-interest just like the Khmer Rouge in Cambodia in 1976 believed in complete egalitarianism, and the Venezuelan government believes in price controls and denying the scale of its economic crisis.
I do not see how Liz Truss can get through the coming Conservative Party conference with these borrowing plans. She should be ousted shortly after it if Conservative MPs have any sense of economic responsibility left.
I was fully expecting a leadership election next summer followed by a GE in the autumn.
But, now - jeez - who knows. Could be a leadership election by November.
There are no good options for the Tories from here. The only question now is, can Labour win an overall majority? I think they can, even without a big recovery in Scotland.
Yeah, it's certainly feasible.
It's early days, but future historians may have to look at which party self-defeated the most: Labour under Corbyn, or the Conservatives under Truss and the latter days of Johnson (who was riding high in the polls until two years ago).
I'd argue the Conservatives have it worst, as they're doing this sh*t whilst they are in power. Labour at least had their lunacy in opposition.
Just imagine the coverage if the pound and gilts had performed as they have since Friday morning after a Labour budget in which billions more had been borrowed to fund better public services and infrastructure.
Hey, I'm not defending that budget. I'm hardly a financial expert, but it seems a little crazy to me, and pretty much a political suicide note.
Is *anyone* on here defending it? Does anyone think it is a good budget (leaving aside the terrible political optics)?
In all seriousness, does Truss genuinely believe she was going to come in and somehow succeed with her approach? She was massively over promoted in cabinet and had nothing to show for it, apart from a few terrible trade deals
I don’t think she has the personality or presence to reassure voters either. There’s just nothing about her
Even conservative party members must be worried by how things are going. The government's economic policy is pure ideology and self-interest just like the Khmer Rouge in Cambodia in 1976 believed in complete egalitarianism, and the Venezuelan government believes in price controls and denying the scale of its economic crisis.
I do not see how Liz Truss can get through the coming Conservative Party conference with these borrowing plans. She should be ousted shortly after it if Conservative MPs have any sense of economic responsibility left.
I was fully expecting a leadership election next summer followed by a GE in the autumn.
But, now - jeez - who knows. Could be a leadership election by November.
Coronation, not election.
Can you imagine 6 weeks of no idea what the next leader will do? The pound will be at parity with the sea-shell. And sinking against that.
Could all the newfound converts to exchange rate targeting tell us which dollar exchange rate the government should aim for and why?
Who are those converts ?
A degree of stability is desirable. Let me know if you think the current shower are providing that ?
Stability is only desirable if you think the prevailing trajectory is the right one. If you want to change anything, you need to shake things up.
Ok, but can we afford to change things? The government does not seem to have seen this mess coming, and even if their plans make sense, how long until the benefits will be felt?
As we're in the shit right now, this very minute.
If I have a sensible plan to lose weight I might still need to put it on hold if I am in the middle of being burned alive.
As I predicted last night: Black Monday has arrived.
Liz "move fast and break things" Truss.
We’ve already had a black Monday so it would be neater narrative-wise if the markets could hang on for the real meltdown and BoE intervention until Black Tuesday.
In all seriousness, does Truss genuinely believe she was going to come in and somehow succeed with her approach? She was massively over promoted in cabinet and had nothing to show for it, apart from a few terrible trade deals
I don’t think she has the personality or presence to reassure voters either. There’s just nothing about her
Even conservative party members must be worried by how things are going. The government's economic policy is pure ideology and self-interest just like the Khmer Rouge in Cambodia in 1976 believed in complete egalitarianism, and the Venezuelan government believes in price controls and denying the scale of its economic crisis.
I do not see how Liz Truss can get through the coming Conservative Party conference with these borrowing plans. She should be ousted shortly after it if Conservative MPs have any sense of economic responsibility left.
I was fully expecting a leadership election next summer followed by a GE in the autumn.
But, now - jeez - who knows. Could be a leadership election by November.
Coronation, not election.
Can you imagine 6 weeks of no idea what the next leader will do? The pound will b at parity with the sea-shell. And sinking against that.
Wouldn’t a complete vacuum be a significant improvement?
That said, knowing the Tory party right now they will go ahead and elect Dorries, Mogg or Johnson 2.0.
Could all the newfound converts to exchange rate targeting tell us which dollar exchange rate the government should aim for and why?
Who are those converts ?
A degree of stability is desirable. Let me know if you think the current shower are providing that ?
Stability is only desirable if you think the prevailing trajectory is the right one. If you want to change anything, you need to shake things up.
'I decided my career trajectory wasn't what I was aiming for. Therefore, I shook things up by cutting my arms off so I would qualify for the two ticks scheme.'
Doesn't quite work for me as a scenario, if I'm honest.
Could all the newfound converts to exchange rate targeting tell us which dollar exchange rate the government should aim for and why?
As someone who was on Holiday in the US in the summer, and quite liked it, I'd prefer £2 to the dollar. Don't know what the economic implications of that are, but since it's not happening it doesn't matter anyway.
Could all the newfound converts to exchange rate targeting tell us which dollar exchange rate the government should aim for and why?
As someone who was on Holiday in the US in the summer, and quite liked it, I'd prefer £2 to the dollar. Don't know what the economic implications of that are, but since it's not happening it doesn't matter anyway.
You may want to check your maths there as you've just made £1 worth half what it currently is which makes the US twice as expensive as it was when you last visited it.
For reference that would make an iphone 14 £1600 rather than the £800 it currently is...
I am sorry to keep whinging on about it but the current economic situation is a result of us ignoring our trade balance for 30 years. We simply have far less room for manoeuvre now. The rest of the world has put up their savings to buy our assets to fund our profligacy. They call the tunes and Kwasi is off key.
A government which already has an enormous trade deficit simply cannot boost growth with tax cuts and public spending designed to boost consumption. We have run out of capital to draw on. We need to cut consumption, increase taxes, cut government spending and recognise we can’t live beyond our means indefinitely. Exactly the same prescription that the World bank has been inflicting on under capitalised third world countries for decades now.
This does feel like an important moment. We've been living in an economic dream world for too long. Truss and co have offered an even more enticing dream - lower taxes! More spending! - on the hope that we will continue to dream.
Instead it's such a strong dream its caused us to snap awake, realising it's too good to be true.
Most of the Cabinet made their money in the City. Surely they saw this coming? At least as a serious possibility?
Rees-Moog's father's book Blood On The Streets, and several others in his output, explain how disaster capitalism is a good thing. Rees-Mogg idolised his father and models his persona on him. These are extremely ideological people, for whom narrow self-interest will always magically serve the greater good, in the end. Odey employed Kwarteng...etc.
Coming to this a bit late, but re the BBC and the funeral.
This was a state funeral paid for by the state ie by us. Ditto the accession councils and all the rest of it. The BBC is funded by those who pay the license fee. This was not a private matter and the BBC was not hired by the RF like some wedding photographer. So the entire film of the occasion is a historic archive not the private property of the monarchy.
I very much hope the BBC (and, if necessary, the government) tell the monarchy to get stuffed if they try to limit access or use. This sort of arrogance is what will do for the monarchy.
Yes and the BBC filmed the funeral and accession council and lying in state live and in full.
However the archive is an entirely different matter, as it was also a funeral of a member of the royal family they get a say on how much of it broadcasters can store and use
Nonsense. If I filmed part of the funeral, that film belongs to me and the RF has no right to determine what I store and how I use it. No different for the BBC.
The RF cannot have their cake and eat it. This was a public historic and state event. The private family part of it was not filmed for the public. The RF have no right to determine what happens to films made of them in the public domain.
HYUFD is convinced, for some reason, that there’s s written contract. Which seems a bit daft to me. The RF will be doing what they always do, which is a mixture of trading on the habitual over-deference of the major broadcasters, and threatening to withhold future access. They should be politely but firmly resisted.
I think it’s more likely than not that there is a written document of some sort - where they can put cameras etc
I'm sure there is. That's not the same thing as a contract which assigns copyright.
It is clear from the reporting that there is that too (or at least makes explicit provisions about use of material)
Well this discussion has reminded me to go and make a perfect digital copy via get-iPlayer while the unedited version is still up. It’s utterly pointless to try and restrict access to things these days because it takes minutes to make a perfect copy and use it however you like.
Could all the newfound converts to exchange rate targeting tell us which dollar exchange rate the government should aim for and why?
As someone who was on Holiday in the US in the summer, and quite liked it, I'd prefer £2 to the dollar. Don't know what the economic implications of that are, but since it's not happening it doesn't matter anyway.
You may want to check your maths there as you've just made £1 worth half what it currently is which makes the US twice as expensive as it was when you last visited it.
For reference that would make an iphone 14 £1600 rather than the £800 it currently is...
It would be great news for me given a lot of my work is paid in dollars.
Could all the newfound converts to exchange rate targeting tell us which dollar exchange rate the government should aim for and why?
As someone who was on Holiday in the US in the summer, and quite liked it, I'd prefer £2 to the dollar. Don't know what the economic implications of that are, but since it's not happening it doesn't matter anyway.
You may want to check your maths there as you've just made £1 worth half what it currently is which makes the US twice as expensive as it was when you last visited it.
For reference that would make an iphone 14 £1600 rather than the £800 it currently is...
Haha, oh how embarrassing! I spent ages thinking of 'which way around is it?' before confidently hitting post. £1 to $2 dollars please and thank you.
We were presented a choice between Scandinavia or the USA. Unfortunately, we seem to have gone for Argentina.
I was just pondering that, oddly. I'm sure that Uriburu said something similar to @Leon about how Argentina would be attractive to foreign investors if it had the right government.
And it's never recovered.
Even though it's got massive natural resources and considerably greater strategic security.
The bank will need to bring in an emergency interest rate rise this morning. We might have got away with matching the 0.75% from the Fed but the Bank once again blew it. That chance has now gone and we need to catch up with the Fed and possibly even go ahead of them.
Getting those who voted for 0.5% ( including the governor) to resign might also be a good move, indicating that the bank takes inflation seriously and recognises the risk of imported inflation from a weak pound.
The government too has to recognise that we can’t keep putting “emergencies” on the credit card. We did it with the GFC, with Covid and now with gas. We have to accept that our terms of trade no longer permit this. We are too indebted as a nation to afford it.
What could possibly go wrong with giving the IT firm responsible for the Post Office scandal - the biggest miscarriage of justice there has ever been - the contract to work on the Police National Computer?
As you suggesting Fujitsu - who bear responsibility for the IT failure but not the scandal - should never get another contract from the government?
So far in less than 3 weeks Liz Truss has killed the Queen (she was the last person outside the bubble in Balmoral to meet her) and tanked the economy.
I am sorry to keep whinging on about it but the current economic situation is a result of us ignoring our trade balance for 30 years. We simply have far less room for manoeuvre now. The rest of the world has put up their savings to buy our assets to fund our profligacy. They call the tunes and Kwasi is off key.
A government which already has an enormous trade deficit simply cannot boost growth with tax cuts and public spending designed to boost consumption. We have run out of capital to draw on. We need to cut consumption, increase taxes, cut government spending and recognise we can’t live beyond our means indefinitely. Exactly the same prescription that the World bank has been inflicting on under capitalised third world countries for decades now.
This does feel like an important moment. We've been living in an economic dream world for too long. Truss and co have offered an even more enticing dream - lower taxes! More spending! - on the hope that we will continue to dream.
Instead it's such a strong dream its caused us to snap awake, realising it's too good to be true.
Though it's just as likely that we will awake, decide we want the dream to be true, blame the current crop of politicians for their failure and elect someone even worse.
Coming to this a bit late, but re the BBC and the funeral.
This was a state funeral paid for by the state ie by us. Ditto the accession councils and all the rest of it. The BBC is funded by those who pay the license fee. This was not a private matter and the BBC was not hired by the RF like some wedding photographer. So the entire film of the occasion is a historic archive not the private property of the monarchy.
I very much hope the BBC (and, if necessary, the government) tell the monarchy to get stuffed if they try to limit access or use. This sort of arrogance is what will do for the monarchy.
Yes and the BBC filmed the funeral and accession council and lying in state live and in full.
However the archive is an entirely different matter, as it was also a funeral of a member of the royal family they get a say on how much of it broadcasters can store and use
Nonsense. If I filmed part of the funeral, that film belongs to me and the RF has no right to determine what I store and how I use it. No different for the BBC.
The RF cannot have their cake and eat it. This was a public historic and state event. The private family part of it was not filmed for the public. The RF have no right to determine what happens to films made of them in the public domain.
HYUFD is convinced, for some reason, that there’s s written contract. Which seems a bit daft to me. The RF will be doing what they always do, which is a mixture of trading on the habitual over-deference of the major broadcasters, and threatening to withhold future access. They should be politely but firmly resisted.
I think it’s more likely than not that there is a written document of some sort - where they can put cameras etc
I'm sure there is. That's not the same thing as a contract which assigns copyright.
It will be a contract. And it may well assign copyright - I know the ones I have seen in the past do both
What could possibly go wrong with giving the IT firm responsible for the Post Office scandal - the biggest miscarriage of justice there has ever been - the contract to work on the Police National Computer?
As you suggesting Fujitsu - who bear responsibility for the IT failure but not the scandal - should never get another contract from the government?
Yes because the IT failures behind the scandal are the sort of things you don't want happening with the Police National Computer.
Unless of course you want numerous back doors allowing evidence to be planted as and when required to remove awkward people from the public gaze....
What could possibly go wrong with giving the IT firm responsible for the Post Office scandal - the biggest miscarriage of justice there has ever been - the contract to work on the Police National Computer?
As you suggesting Fujitsu - who bear responsibility for the IT failure but not the scandal - should never get another contract from the government?
Not for a long time they shouldn't. Gross incompetence in their product and performance, so any claims submitted in a tender cannot be trusted
What could possibly go wrong with giving the IT firm responsible for the Post Office scandal - the biggest miscarriage of justice there has ever been - the contract to work on the Police National Computer?
As you suggesting Fujitsu - who bear responsibility for the IT failure but not the scandal - should never get another contract from the government?
Yes because the IT failures behind the scandal are the sort of things you don't want happening with the Police National Computer.
Unless of course you want numerous back doors allowing evidence to be planted as and when required to remove awkward people from the public gaze....
I am sorry to keep whinging on about it but the current economic situation is a result of us ignoring our trade balance for 30 years. We simply have far less room for manoeuvre now. The rest of the world has put up their savings to buy our assets to fund our profligacy. They call the tunes and Kwasi is off key.
A government which already has an enormous trade deficit simply cannot boost growth with tax cuts and public spending designed to boost consumption. We have run out of capital to draw on. We need to cut consumption, increase taxes, cut government spending and recognise we can’t live beyond our means indefinitely. Exactly the same prescription that the World bank has been inflicting on under capitalised third world countries for decades now.
Very true. So the question is for you few remaining pro-Tory posters with brains is this: what the fuck are they doing???? The (we've had enough of) experts" said borrowing money to pay for tax cuts to the very rich was mad, doing it whilst borrowing costs were soaring was insane, then they saw Kamikwarteng literally cackling at the dispatch box as he slammed down lunacy after lunacy on Friday.
This isn't a run on the pound. If the gilts price report is correct its now a run on the UK. The world has looked at the new PM and Chancellor and decided - with good reason - they are mentalists. So, Tories. What's your next play?
Top news story on the BBC of all places, about the record low pound.
This is seriously bad for the Conservatives. I'm not sure they can turn this around now.
People dont understand economics. I dont. But they can follow a story about the plunging pound.
Things might recover, but impressions are set early - what people will remember is the government announced plans which unapologetically focused on helping the rich ahead of anyone else, and then there was a bunch of terrible news about markets falling.
An unscheduled meeting would be a significant political moment. It wouldn’t be on a par with the IMF bail-out of 1976 or our departure from the ERM in 1992 but it’d be a moment nonetheless, with potential repercussions for the future relationship between the Bank & the Govt. https://twitter.com/DavidGauke/status/1574297182915682306
Comments
Germany has bought much if its gas, as it has the storage; we still have much of ours to buy.
It probably will work out better than the more pessimistic forecasts, but we don't yet know.
Can’t imagine why there would be any volatility!
https://twitter.com/Samfr/status/1574150830990794752?t=sjNXElfRkateZmyMGQ5HsA&s=19
https://en.m.wikipedia.org/wiki/Fourteen_Words
For anyone else unfamiliar with this piece of nuttiness
I don’t think she has the personality or presence to reassure voters either. There’s just nothing about her
(I really need to go back and re-read the document MM linked to about it and see if I still feel the same way...)
https://www.mirror.co.uk/news/politics/firm-behind-post-office-scandal-28074668
What could possibly go wrong with giving the IT firm responsible for the Post Office scandal - the biggest miscarriage of justice there has ever been - the contract to work on the Police National Computer?
I’m starting to wonder which country I should emigrate to.
The Tories had one more roll of the dice with Truss and it’s backfired.
In addition Starmer has really stepped up and looks like the next PM in waiting.
I say “almost” because nothing is certain and there is still a very narrow pathway to Tory victory in 2024, but I think that is now shrinkingly narrow.
Along with Kwateng, they are above us mere mortals.
Frankly, the membership can fuck right off in having any say how we move forward. It is down to MPs. You won't hear of letters going in to Brady because that would just spook the markets There will be co-ordinated moves to put somebody in place who will do what is needed to get the markets onside. Which basically have to be to return to the Rishi budget. Tax rises and all.
This will look like Black Wednesday cubed for the fortunes of the Conservative Party.
But the episode smells worse than PPE contracts for ministers mates.
Here's why it's a bad idea:
"Chris Davidson: Former pro-surfer dies after punch outside Australian pub"
https://www.bbc.co.uk/news/world-australia-63030306
(I think it’s an absolutely stupid procurement rule, but there we go)
https://twitter.com/mikegalsworthy/status/1573775346213834753
https://www.theguardian.com/uk-news/2022/sep/22/royal-family-veto-footage-coverage-queen-elizabeth-ii-funeral
A degree of stability is desirable. Let me know if you think the current shower are providing that ?
That it seems to have gone down like a bucket of cold sick is immaterial - even Truss is selling her plans as going to work and be popular 'later'.
"We’ve entered the part of the currency crisis where psychology takes over. That could mean the markets continue to test the Bank and the pound falls further" warns Paul Dales, @CapEconomics chief UK economist in a note to clients
https://twitter.com/fletcherr/status/1574289758729211906/photo/1
A government which already has an enormous trade deficit simply cannot boost growth with tax cuts and public spending designed to boost consumption. We have run out of capital to draw on. We need to cut consumption, increase taxes, cut government spending and recognise we can’t live beyond our means indefinitely. Exactly the same prescription that the World bank has been inflicting on under capitalised third world countries for decades now.
https://twitter.com/EdwardGLuce/status/1574230574088134656
I do not see how Liz Truss can get through the coming Conservative Party conference with these borrowing plans. She should be ousted shortly after it if Conservative MPs have any sense of economic responsibility left.
Liz "move fast and break things" Truss.
But, now - jeez - who knows. Could be a leadership election by November.
Surely they saw this coming? At least as a serious possibility?
Can't we? Gulp...
Is *anyone* on here defending it? Does anyone think it is a good budget (leaving aside the terrible political optics)?
Can you imagine 6 weeks of no idea what the next leader will do? The pound will be at parity with the sea-shell. And sinking against that.
As we're in the shit right now, this very minute.
If I have a sensible plan to lose weight I might still need to put it on hold if I am in the middle of being burned alive.
That said, knowing the Tory party right now they will go ahead and elect Dorries, Mogg or Johnson 2.0.
Doesn't quite work for me as a scenario, if I'm honest.
You guys are just a bunch of knicker-wetters. In a not good way
Would Sunak accept the return of Johnson? Would the reverse be true?
Sunak should be the man but would Boris Johnson's supporters kick up a stink? Probably, they back an egotistical creature of absolute self-regard.
For reference that would make an iphone 14 £1600 rather than the £800 it currently is...
Instead it's such a strong dream its caused us to snap awake, realising it's too good to be true.
Unfortunately, we seem to have gone for Argentina.
For everyone else - not so much!
Maybe better to keep them and burn them over the winter...
Just saying.
Now 4.35% for a two year gilt (was 3.2% a week ago, 1.7% at beginning of August)… 4.1% for 10 year
Sterling fighting back in last hour - still down but by less. $1.07
https://twitter.com/faisalislam/status/1574296562355806209
The question de jour is: at what point is that?
And it's never recovered.
Even though it's got massive natural resources and considerably greater strategic security.
Getting those who voted for 0.5% ( including the governor) to resign might also be a good move, indicating that the bank takes inflation seriously and recognises the risk of imported inflation from a weak pound.
The government too has to recognise that we can’t keep putting “emergencies” on the credit card. We did it with the GFC, with Covid and now with gas. We have to accept that our terms of trade no longer permit this. We are too indebted as a nation to afford it.
I wonder what this week will bring....
Ed Conway.
Unless of course you want numerous back doors allowing evidence to be planted as and when required to remove awkward people from the public gaze....
This is seriously bad for the Conservatives. I'm not sure they can turn this around now.
On what basis can we assume they are unhappy?
All their mates are getting rich
This isn't a run on the pound. If the gilts price report is correct its now a run on the UK. The world has looked at the new PM and Chancellor and decided - with good reason - they are mentalists. So, Tories. What's your next play?
Things might recover, but impressions are set early - what people will remember is the government announced plans which unapologetically focused on helping the rich ahead of anyone else, and then there was a bunch of terrible news about markets falling.
https://twitter.com/DavidGauke/status/1574297182915682306