Robert Peston @Peston Tory minister: "Kwasi is toast"
That’s an absolute nonsense politically and Peston and this “minister” (if there is one) should know that. This isn’t a policy dreamt up in isolation by the Chancellor and dumped on the government. This was the central thesis on what the PM was elected by her members. If he goes, she goes. So he won’t, soon at least.
The reason Sunak is quiet is that he is the author of the situation we are in.
It was Sunak who blew GBP400bn on thin air during covid, in a scheme ridden with profiteering and fraud, to almost universal applause on here and in parliament. The worst use of taxpaper money ever.
A very few of us questioned the sanity of this at the time, and asserted that banktupcty, or close to it, was the almost inevitable outcome of what Sunak and Johnson were doing. To almost universal derision.
And now here we f8cking are....
Disagree utterly. Every economy had to provide massive support to prevent the collapse of society under COVID.
Even more a reason not to go off piste which is what Truss and KK have done.
Robert Peston @Peston Tory minister: "Kwasi is toast"
If Peston is tweeting that Kwasi is toast, he is almost certainly safe.
The same journalists who were questioning why we weren't locking down harder and spending more on furlough, are now worried about our financial situation.
If Truss and Kwarteng, and all the tories, have finally stopped listening to these brainless parrots, and stopped treating them seriously, good.
I suspect they have, because they cannot stand up a single tory MP to criticise the government.
Kwarteng and Truss have virtually assured a labour government in 2024 and at the same time put the perceived mortgage rate rises at their door, when in truth the bond market worldwide is being routed through the authorities aggressive rise in interest rates as inflation is being fought against everywhere . It is likely about 1% has been added because of the kamikaze behaviour of Kwarteng but even if Starmer had been in no 10 he would be looking at a housing crisis that is hard to see how it is mitigated
I am old enough to remember negative equity and it looks as if this could return over the next few yeaes, but sadly we have become used to very low interest rates which look like being returned to more normal ones and yes many will be affected but we are not immune to worldwide events
Labour have had a good conference but the one thing missing is that they have failed to understand that the economy in 2024 is going to be in a very poor place, and ironically they may well have to raise taxes and reduce public sector spending by an amount that to a Labour party will be very difficult
I do not defend Kwarteng or Truss but at the very least she needs to sack Kwarteng if she wants to have any chance of surviving , and she has a ready made successor she knows only too well, one Rishi Sunak
The obvious pivot - which Starmer and his team have hinted at already - is how we rebuild after the Great Truss Financial Crisis. We invest, and gain a return on that investment. Some of that investing will need to come from government and he's already announced the first StateCo to do energy. Much will need to come from the private sector, and as they are always looking for something sane to put money in there will be plenty of opportunities.
This final phase of Torynomics will kill dead the stupidty of "who will pay for that" and "what will you cut to find the money". Investment had been turned by the Tories into a dirty word. Their spivvy hedgie friends don't want investment, they just want to turn a quick profit now and not care about tomorrow.
That has to end. So many of the things this country needs - infrastructure, hospitals and schools fit for purpose, sustainable self-reliant energy generation - deliver both a long-term positive ROI but a short-term boost when money goes to pay people to build stuff who then pay taxes and spend. Which gives other people jobs.
We used to call it capitalism. Starmer will lead us back there.
In normal times yes but 2024 will not be normal
As far as GB Energy is concerned it is modelled on EDF in France who have just had a 15 billion buy out by Macron and Lucy Powell this morning simply was wholly unconvincing in her explanation about its funding
Its pretty simple: 1. UK needs a big expansion in generating capacity 2. Instead of paying a foreign company to install, own and manage this, the UK will create its own company to do so 3. Instead of buying all of the components from abroad, the UK will promote UK manufacturing to supply turbines and solar panels.
The money will be spend regardless. Because there is no scenario where "sorry, we can't afford to create the generating capacity we need, we'll just have to have brownouts instead"
Also, France's issues this summer stemmed from the fact loads of their nuclear power stations were on rivers which obviously dry up somewhat in a heatwave. Sea level rises are quite predictable beyond the lifespan of any nuclear plant so it's not an issue we'd encounter as ours are all by the sea.
There are some things we cannot afford not to do. Energy generating capacity is a pertinent example - we either invest or we suffer both brownouts and crazy spot price gouging. So the money is being spent regardless - do we hand this over to the French government or the Swedish government, or copy their successful examples and do it ourselves?
With our geographic location and our tech / industrial abilities we should be a global leader in renewables. Instead the market and a "government involvement is communism" mindset means we are nowhere. If we're to spend the money - and we are - why not have something to show for it other than just the infrastructure?
It is more or less what I was advocating on here a couple of days ago, except I thought of renationalisation of existing companies rather than setting one up from scratch.
Personally, I like SKS's idea. The UK needs control of its critical infrastructure rather than bleeding money to foreign owners
Why renationalise any of them? We have regulated markets. Simply regulate them so that the new StateCo is in prime position and let the private sector decide whether it wants to play in a competitive market instead of the protected cartels we have now.
Big_G and DavidL have raised concerns and they are understandable to a point. But the only way we will ever regain our ability to manufacture, install and manage wind turbines is if we do so. And there is something seriously pathetic about an argument that Britain is unable to do the basics that somewhere like Sweden can and its too hard / risky for us to repair that position so that we can.
So much for global Britain. Some on the right would have us an eternal supplicant.
The problem with that is that StateCo becomes the new cartel, and when it fails to work properly the industry - and hence all of us - are screwed. This has happened time and time again.
You also seem to be in favour of protectionism?
The problem with state owned monopolies is that
- they tend to producer interest. If you are state defined monoply, fucking the customers over is the sensible option. 6 week waits for installing a telephone were good for BT. Think DVLA….
- investment tends to be controlled for political interest. Locations for one. Long term investment vanishes - why spend money to bear fruit after the next election?
Ultimately they see producing the service as irritating byproduct of their existence. See the Yes Minister episode about the best hospital in the NHS. The one with no patients.
I'm at a loss at all the DVLA stories, For the simple stuff things are done in minutes automatically and then sent in days...
What is left and takes time is the complex bits...
My Dad (83) had his driving licence withdrawn after an eye test in Dec, midway between cataract surgery (both eyes, completed in Jan). It took 8 months to get it back, despite his eyesight being fine in January. There have been stories of staff refusing to return to the office because covid. Utter shambles. MP was useless, didn't even answer emails for help.
One thing they could do is stop the requirement to send your driving licence to them when you get penalty points. There is simply no reason for doing this, as licences don't actually show the points. Yet it creates a time consuming paper trail for no reason.
Imagine you work in a government department. Or a very large company.
You reduce paperwork.
Do you get a bonus?
Well, you’ve probably reduced the size of your team. So they will cut your budget. Because you have less reports, you are less important - that’s promotion fucked. And you manager is angry because his empire has shrunk…
In the commercial works, it takes high level management backing and lots of guys to actually cut costs.
At a casual guess, I could reduce the DVLA staffing by 80% - it would take some hundreds of millions and several years for putting the automation in. And you’d probably want to hire better (and more expensive) people for the positions left.
The result would be faster service, better scaling. And would be politically impossible, probably.
I hate to be the kind of poster who just shares Twitter links, but FinTwit is absolutely awash with rumours about several large UK pension funds being insolvent.
The word here is contagion. We seem to be looking at a systemic risk similar to the GFC - only this time, central banks have run out of road.
This looks big and not just for Britain. It may be that we're just the first domino to fall.
Yes, that’s my suspicion
The world is slowly tip toeing along a cliff top. Blindfold. The precipice represents total loss in economic confidence. Western nations in particular are roped together
Britain’s mistake was to break ranks “confidently” so as to speed up progress. Instead we now have one leg dangled over the edge
But we are tugging others with us. And others are also in trouble (for other reasons)
The reason Sunak is quiet is that he is the author of the situation we are in.
It was Sunak who blew GBP400bn on thin air during covid, in a scheme ridden with profiteering and fraud, to almost universal applause on here and in parliament. The worst use of taxpaper money ever.
A very few of us questioned the sanity of this at the time, and asserted that banktupcty, or close to it, was the almost inevitable outcome of what Sunak and Johnson were doing. To almost universal derision.
And now here we f8cking are....
Disagree utterly. Every economy had to provide massive support to prevent the collapse of society under COVID.
Even more a reason not to go off piste which is what Truss and KK have done.
Every f8cking economy is suffering though matey, whatever their policy mix, do you not pay attention to the financial markets?
The Europeans are in a terrible position, maybe worse than us, and the Americans are looking at recession too.
OK, finance boffins, what's the best realistic case from here?
Suppose KK goes, Truss is allowed to stay on condition that she stays sat at her desk, is very quiet and doesn't touch anything, Rishi returns to No 11...
What does he do? How much worse off are we all compared to the case where Last Week Didn't Happen?
The economics of it, I doubt anyone really knows, although some will pretend they do.
The politics of it are more clear cut. There is no way Truss and Kwasi can survive this. It's unprecedented as far as I know for a CoL in this country to destroy confidence in such rapid order.
On top of that, none of this has any political mandate from the country. Truss was not elected on a libertarian ticket, she was elected on the Boris pledge of levelling up .
Not only does the mini-budget call into question the financial stability of the country but it raises serious issues with our constitutional setup. We simply can't go through this process again with a new Prime Minister coming in, based on a tiny vote amongst a weird selectorate, and then just ripping up the manifesto / mandate that the governing party was elected upon.
Yeah, there is a legitimacy crisis here, too. Truss came in and has had, arguably, the worst first month as PM and it is mostly self inflicted. Even if the Tories got shot of her a) the Tory membership will cry foul and question why their mandate can so quickly be overturned and b) the country will ask why the Tory party is allowed to swap out PM after PM without going back to the country.
It could get very bad very quickly - if the economics of this continue and mortgage rates explode and pensions implode, that's the people typically sympathetic to the Tories buggered. When people take to the streets over inflation, food prices, energy costs and rent - those sympathetic Tories will instead be on their side rather than cheering for the coppers to bash their heads in. (Not to mention coppers may not be as heavy handed as usual given that austerity came for them too)
The reason Sunak is quiet is that he is the author of the situation we are in.
It was Sunak who blew GBP400bn on thin air during covid, in a scheme ridden with profiteering and fraud, to almost universal applause on here and in parliament. The worst use of taxpaper money ever.
A very few of us questioned the sanity of this at the time, and asserted that banktupcty, or close to it, was the almost inevitable outcome of what Sunak and Johnson were doing. To almost universal derision.
And now here we f8cking are....
In other news, Ken Clarke's failure to properly regulate the financial markets was the true cause of the 2007-08 crash and the spike in hospitalisations and deaths in early 2020 were due to swine flu.
I hate to be the kind of poster who just shares Twitter links, but FinTwit is absolutely awash with rumours about several large UK pension funds being insolvent.
The word here is contagion. We seem to be looking at a systemic risk similar to the GFC - only this time, central banks have run out of road.
This looks big and not just for Britain. It may be that we're just the first domino to fall.
Great, and we’ll forever be known as the twits that started it.
Liz and Kwasi are true geniuses.
If that is the case then we will need to go into some form of National Government, there simply can't be a GE as the world implodes. And Labour would have to step up, they can't let a failed government limp on.
What on earth is the message going to be at the Conference next week?
I honestly don't know. This is such a huge fuck up, having the central bank essentially tell them they're a bunch of dickheads and have pushed the UK economy to the brink of crisis is pretty terrible.
BOE buying gilts indemnified by the government via gilt issuance because the market has lost faith in gilts, while the currency is in free fall, mortgage lending has shut down, inflation at 10%... We are heading for potentially the worst economic crisis in the UK in my lifetime.
In your lifetime? Surely it's a lot worse than that. When has it been worse?
2008 to 2011 for starters.
A low sterling to dollar rate is actually good for the UK tourist industry and exporters to the US, even if bad for UK importers and tourists to the US.
After the 2008 crash unemployment reached 8% in the UK, it is now 4%.
In the mid 1970s inflation was also even higher than now
Delusional. This has the potential to be the biggest UK crisis I have ever seen. We run an 8% current account deficit. The currency is tanking. The Bank is having to reverse monetary tightening to prevent the collapse of the gilt market. The government has just unveiled insane fiscal plans that it refused to submit to independent scrutiny. We are financed by foreigners, they have lost confidence in us, completely.
For the average voter the £ tanking against the $ affects them little unless they travel a lot to the US or work for a business that imports a lot from the US. They also have little interest in gilt markets.
Only if unemployment really starts to rise and inflation soars further or there are deep spending cuts to pay for the big tax cuts will it really hit them personally
The change in the gilt markets have caused a massive jump in mortgage rates that will likely lead to a drop in house prices. We've already had posts from people on here who have been, or fear that they will be, affected personally as a result. It's done.
What on earth is the message going to be at the Conference next week?
I honestly don't know. This is such a huge fuck up, having the central bank essentially tell them they're a bunch of dickheads and have pushed the UK economy to the brink of crisis is pretty terrible.
BOE buying gilts indemnified by the government via gilt issuance because the market has lost faith in gilts, while the currency is in free fall, mortgage lending has shut down, inflation at 10%... We are heading for potentially the worst economic crisis in the UK in my lifetime.
In your lifetime? Surely it's a lot worse than that. When has it been worse?
2008 to 2011 for starters.
A low sterling to dollar rate is actually good for the UK tourist industry and exporters to the US, even if bad for UK importers and tourists to the US.
After the 2008 crash unemployment reached 8% in the UK, it is now 4%.
In the mid 1970s inflation was also even higher than now
Delusional. This has the potential to be the biggest UK crisis I have ever seen. We run an 8% current account deficit. The currency is tanking. The Bank is having to reverse monetary tightening to prevent the collapse of the gilt market. The government has just unveiled insane fiscal plans that it refused to submit to independent scrutiny. We are financed by foreigners, they have lost confidence in us, completely.
For the average voter the £ tanking against the $ affects them little unless they travel a lot to the US or work for a business that imports a lot from the US. They also have little interest in gilt markets.
Only if unemployment really starts to rise and inflation soars further or there are deep spending cuts to pay for the big tax cuts will it really hit them personally
How many voters understood the nuts and bolts of being in and then not being in the ERM? And that wasn't accompanied by unemployment or interest rate rises (except in the very short term). Still did for the govt.
Yes it was, unemployment reached 10% in 1993 after Black Wednesday as well as high interest rates and negative equity
The chances of a new Faragist populist movement must be pretty high. Throw his lot back in with Tice or start up a new one? And whilst we are at it, a Change UK style Tory centrist splitters party. Come on guys, lets have some new toys
Why not just let the winner of the Ch4 show take over for real? Can't be much worse than the current system of choosing a leader surely?
I genuinely thought the Tories could not find a worse leader than Boris Johnson. How wrong I was.
Sorry to say, that I repeatedly told my mates down the pub that much as we all loathed Johnson over the lying, the replacement would end up being worse.
I had no idea the replacement would be this many light years worse.
My error was to believe there was some level of residual sanity and decency inside the Conservative party. I was a fool.
Most of that sanity was thrown out by Johnson.
I cannot believe we are not going to see one or two floor crossings when the Commons reopens.
The chickens will run at some point.
A neat trick would be sensible Tories in marginal seats defecting en masse.
Labour are more likely to take MPs in safe Tory seats (providing their background isn't too right wing, which rather limits the potential numbers). Marginal MPs are stuck, unless they simply want to split.
OK, finance boffins, what's the best realistic case from here?
Suppose KK goes, Truss is allowed to stay on condition that she stays sat at her desk, is very quiet and doesn't touch anything, Rishi returns to No 11...
What does he do? How much worse off are we all compared to the case where Last Week Didn't Happen?
The economics of it, I doubt anyone really knows, although some will pretend they do.
The politics of it are more clear cut. There is no way Truss and Kwasi can survive this. It's unprecedented as far as I know for a CoL in this country to destroy confidence in such rapid order.
On top of that, none of this has any political mandate from the country. Truss was not elected on a libertarian ticket, she was elected on the Boris pledge of levelling up .
Not only does the mini-budget call into question the financial stability of the country but it raises serious issues with our constitutional setup. We simply can't go through this process again with a new Prime Minister coming in, based on a tiny vote amongst a weird selectorate, and then just ripping up the manifesto / mandate that the governing party was elected upon.
Yeah, there is a legitimacy crisis here, too. Truss came in and has had, arguably, the worst first month as PM and it is mostly self inflicted. Even if the Tories got shot of her a) the Tory membership will cry foul and question why their mandate can so quickly be overturned and b) the country will ask why the Tory party is allowed to swap out PM after PM without going back to the country.
It could get very bad very quickly - if the economics of this continue and mortgage rates explode and pensions implode, that's the people typically sympathetic to the Tories buggered. When people take to the streets over inflation, food prices, energy costs and rent - those sympathetic Tories will instead be on their side rather than cheering for the coppers to bash their heads in. (Not to mention coppers may not be as heavy handed as usual given that austerity came for them too)
The reason Sunak is quiet is that he is the author of the situation we are in.
It was Sunak who blew GBP400bn on thin air during covid, in a scheme ridden with profiteering and fraud, to almost universal applause on here and in parliament. The worst use of taxpaper money ever.
A very few of us questioned the sanity of this at the time, and asserted that banktupcty, or close to it, was the almost inevitable outcome of what Sunak and Johnson were doing. To almost universal derision.
And now here we f8cking are....
But didn't most economies spend a shit ton during covid to cover costs of schemes and such, and they're not planning on going the Truss route, nor have their economies imploded (indeed, many of them are doing better than us).
Have you checked out the euro? checked out how yields are faring on all Western country government bonds? FFS they are ALL struggling, whatever the policy mix.
I don't think 1 voter in 20 understood what happened or why it happened on black Wednesday but they gleaned enough to realise that the Tories had screwed up the only thing they were supposed to be good at and it put them out of office for a generation. This is starting to get that sort of feel.
The election in 2024 may be a gonner but the Tories should start to worry about 2028, 2032, 2037, etc.
The reason Sunak is quiet is that he is the author of the situation we are in.
It was Sunak who blew GBP400bn on thin air during covid, in a scheme ridden with profiteering and fraud, to almost universal applause on here and in parliament. The worst use of taxpaper money ever.
A very few of us questioned the sanity of this at the time, and asserted that banktupcty, or close to it, was the almost inevitable outcome of what Sunak and Johnson were doing. To almost universal derision.
And now here we f8cking are....
Disagree utterly. Every economy had to provide massive support to prevent the collapse of society under COVID.
Even more a reason not to go off piste which is what Truss and KK have done.
Every f8cking economy is suffering though matey, whatever their policy mix, do you not pay attention to the financial markets?
The Europeans are in a terrible position, maybe worse than us, and the Americans are looking at recession too.
Yep, everyone's F**ked, some are more than others.
Right now we're talking about the UK and this immediate crisis ok?? I don't see any panic in Washington or Brussels today.
"Does this matter? LDI managers claim that their activities pose no systemic risk, and I read the Bank of England financial policy committee’s silence as agreement. But UK pension funds are collectively very large derivative counterparties and they move together."
Schemes, looking to be swallowed by insurance companies, have already been selling less liquid assets at a discount as the insurance companies won’t take the risk.
These are not only harder to sell they are having to sell at a significant discount too.
The reason Sunak is quiet is that he is the author of the situation we are in.
It was Sunak who blew GBP400bn on thin air during covid, in a scheme ridden with profiteering and fraud, to almost universal applause on here and in parliament. The worst use of taxpaper money ever.
A very few of us questioned the sanity of this at the time, and asserted that banktupcty, or close to it, was the almost inevitable outcome of what Sunak and Johnson were doing. To almost universal derision.
And now here we f8cking are....
In other news, Ken Clarke's failure to properly regulate the financial markets was the true cause of the 2007-08 crash and the spike in hospitalisations and deaths in early 2020 were due to swine flu.
Also Dennis Healy was responsible for the House Market Crash in 1988.
The reason Sunak is quiet is that he is the author of the situation we are in.
It was Sunak who blew GBP400bn on thin air during covid, in a scheme ridden with profiteering and fraud, to almost universal applause on here and in parliament. The worst use of taxpaper money ever.
A very few of us questioned the sanity of this at the time, and asserted that banktupcty, or close to it, was the almost inevitable outcome of what Sunak and Johnson were doing. To almost universal derision.
And now here we f8cking are....
Odd how the markets were OK while Sunak was CoE, but have gone haywire now.
The reason Sunak is quiet is that he is the author of the situation we are in.
It was Sunak who blew GBP400bn on thin air during covid, in a scheme ridden with profiteering and fraud, to almost universal applause on here and in parliament. The worst use of taxpaper money ever.
A very few of us questioned the sanity of this at the time, and asserted that banktupcty, or close to it, was the almost inevitable outcome of what Sunak and Johnson were doing. To almost universal derision.
And now here we f8cking are....
Disagree utterly. Every economy had to provide massive support to prevent the collapse of society under COVID.
Even more a reason not to go off piste which is what Truss and KK have done.
Every f8cking economy is suffering though matey, whatever their policy mix, do you not pay attention to the financial markets?
The Europeans are in a terrible position, maybe worse than us, and the Americans are looking at recession too.
Yep, everyone's F**ked, some are more than others.
Right now we're talking about the UK and this immediate crisis ok?? I don't see any panic in Washington or Brussels today.
The panic will spread very very quickly though. The implosion of the 5th largest economy in the world should it loom will make the GFC look like a one quarter recession.
The reason Sunak is quiet is that he is the author of the situation we are in.
It was Sunak who blew GBP400bn on thin air during covid, in a scheme ridden with profiteering and fraud, to almost universal applause on here and in parliament. The worst use of taxpaper money ever.
A very few of us questioned the sanity of this at the time, and asserted that banktupcty, or close to it, was the almost inevitable outcome of what Sunak and Johnson were doing. To almost universal derision.
And now here we f8cking are....
Odd how the markets were OK while Sunak was CoE, but have gone haywire now.
I think we have found one of the IDS / Truss voters.
The reason Sunak is quiet is that he is the author of the situation we are in.
It was Sunak who blew GBP400bn on thin air during covid, in a scheme ridden with profiteering and fraud, to almost universal applause on here and in parliament. The worst use of taxpaper money ever.
A very few of us questioned the sanity of this at the time, and asserted that banktupcty, or close to it, was the almost inevitable outcome of what Sunak and Johnson were doing. To almost universal derision.
And now here we f8cking are....
That's absolute bollocks. Britain became a great world power precisely because we innovated the use of national debt to borrow money for times of crisis - like the Napoleonic War - with the confidence that the money would be repaid afterwards.
Now, it's open to debate whether Covid was a crisis that justified massive borrowing, but that argument is irrelevant had the government kept to the other side of the bargain - to repay the debt incurred once the crisis had passed.
What the government made clear last week is that they had no interest in repaying the debt, instead they were going to massively expand it to pay for tax cuts. That's why confidence has gone. That's why we're in trouble.
I know we aren't meant to say this, but the £ has fallen off a cliff again. 1.05.
Nope i have just looked at the Pound in my pocket it is unaffected!
Only that Day Today sketch about the Pound being stolen which went viral yesterday can provide some relief on a day like today.
"The Bank of England is in chaos today following the discovery that The Pound has been stolen. The Pound was stolen at 1-30 today, by thieves dressed as cleaners."
The reason Sunak is quiet is that he is the author of the situation we are in.
It was Sunak who blew GBP400bn on thin air during covid, in a scheme ridden with profiteering and fraud, to almost universal applause on here and in parliament. The worst use of taxpaper money ever.
A very few of us questioned the sanity of this at the time, and asserted that banktupcty, or close to it, was the almost inevitable outcome of what Sunak and Johnson were doing. To almost universal derision.
And now here we f8cking are....
Indeed. Another disastrous mistake by remainer socialists. Just think how much better off we would have been had all those companies simply been allowed to go to the wall and the millions of their employees made redundant with no compensation.
All those assets that the right sort of people could pick up for a song, and a mass labour pool of desperate plebs to exploit. Won't anyone think of the profits lost????
The UK government just snuck out the announcement that they are cutting the British troop deployment in Estonia by 50%. While it is true that the Russian army is now in sufficient mess in Ukraine to want to avoid anywhere else, the timing is, um, "interesting".
I know this is a political website so posters tend to see things through the prism of politics and politicians. But my god, the Bank of England has shown itself to be a shit show. First they delayed the rate rise because of the queen. When it came, everyone with a vague interest could see we needed 75bps last week. And yet we had in her first meeting Swati Dingra, darling of the guardian for her “cancel Brexit” and “cost of living not inflation mantra” voting for 25bps, with Bailey and his chums going for halfway between her and the ones that know their game. And concerned themselves most with the back end of the gilt curve by announcing the dumping of £80bn on the market. This is despite them knowing the Fed and ECB had already raised by 75bps and having a preview of Kwasi’s mini budget.
When gilt yields spiked and the currency crashed, they froze and said the MPC still wouldn’t meet until November, while the market busily priced in big hikes. So the Financial Policy Committee today takes the bull by the horns and reverses the MPC’s bond selling action to try and arrest slide in long term gilts. But we still have no coordinated action from the MPC, so we should expect the currency to tank in the coming days unless they make a clear signal that they will make big rises. As in 175-200bps big.
MPC external appointees are chosen by a panel of Brownite Bank / Treasury servants, with “inclusivity” seemingly as important a qualification as any. How else do we get ultra dovish economists from Delhi and Buenos Aires on the MPC, places not exactly known for a competent inflation record.
I think we’re now in a standoff, with Bailey (by far the worst G7 central bank chief) refusing to take his queue from elected politicians and hoping that the government reverses the tax cuts. As if that would make a difference to market confidence at this point.
Sack the whole MPC, force them to reapply for their roles and remove the limit on how many terms you can serve (currently two 3-year terms).
Your analogy of the car crossing over the motorway was good at the time and looks even better now, but i don't think we have hit a bus yet. There is a way out.
Truss has to sack Kamikwaze and replace him with someone sensible. There are lots of candidates (not Sunak though and he wouldn't accept anyway) but someone like Hammond or Hunt. The markets relax because there is now a grown-up in the room. Truss stays on for a bit, more of less devoid of power and credibility but as a figurehead she'll do until replaced in due course, before the GE, by somebody who should have got the job instead of her (probably, but not necessarily, Sunak.)
Of course the Tories then go down to a crushing defeat at the GE but that looks pretty much nailed on now anyway; however, the Country does not descend into chaos and turmoil. Labour come in to sort out the mess and the Tories go and have a bit of a rethink about what their purpose is.
In terms of your analogy, Leon, no fatal collision, but the police do flag the car down, take names and numbers and redirect the offender to the back of the queue on the right side of the road.
All very regular, all very calm, all thoroughly British.
There’s absolutely no way Truss recovers any confidence from this. It’s not like she didn’t spend weeks before becoming PM saying she’ll do exactly the kind of crazy thing she’s done.
No one will trust her. Her credibility is shot.
There is a precedent for someone who came in, lost market confidence, but then went on to serve 14 years at the top: François Mitterrand.
If you think Truss is an equal politician to Mitterand then I have a bridge to sell you.
Coincidentally there's a bridge here in Oxford that has been closed for a couple of years because the truss has failed.
Oh, which one is that, please?
It’s the pedestrian bridge across the Thames just upstream of Folly Bridge.
I get the impression nobody was maintaining it & the ironwork rusted out. The old railway bridge further upstream has the same problem - the ironwork is clearly rusting out & no-one is keeping up the paintwork in order to stop it getting worse. I guess (but don’t actually know) that there’s some kind of fight over responsibility & the council doesn’t want to pay for it, but if they don’t do it no one else will.
Thanks. I know it - used to visit some good friends of mine who lived very near by. My memory is that the bridge was old even in the 1980s - between two parts of the gas works complex originally, for piping or whatever, between the two sides of the river. Much of the area was brownfield dereliction at the time.
PS not on the same level as some modern concrete road bridge with wider implications for the road network, obvs. But still.
Yes, it’s now council housing (I think) on the left bank & college accommodation on the right bank these days.
The reason Sunak is quiet is that he is the author of the situation we are in.
It was Sunak who blew GBP400bn on thin air during covid, in a scheme ridden with profiteering and fraud, to almost universal applause on here and in parliament. The worst use of taxpaper money ever.
A very few of us questioned the sanity of this at the time, and asserted that banktupcty, or close to it, was the almost inevitable outcome of what Sunak and Johnson were doing. To almost universal derision.
And now here we f8cking are....
Disagree utterly. Every economy had to provide massive support to prevent the collapse of society under COVID.
Even more a reason not to go off piste which is what Truss and KK have done.
Every f8cking economy is suffering though matey, whatever their policy mix, do you not pay attention to the financial markets?
The Europeans are in a terrible position, maybe worse than us, and the Americans are looking at recession too.
Yep, everyone's F**ked, some are more than others.
Right now we're talking about the UK and this immediate crisis ok?? I don't see any panic in Washington or Brussels today.
The panic will spread very very quickly though. The implosion of the 5th largest economy in the world should it loom will make the GFC look like a one quarter recession.
The idea that things would be better under Sunak is for the birds. IF you borrow more than your economy can sustain, you are in trouble, whatever policy mix you have.
The UK will probably need huge spending cuts whoever is in charge. Under Sunak those cuts would have been gargantuan, because the economy would have been in a depression.
Furlough was an utterly insane and reckless gamble, and I suspect most tory MPs now realise this. No wonder they are so quiet.
"To achieve this, the Bank will carry out temporary purchases of long-dated UK government bonds from 28 September. The purpose of these purchases will be to restore orderly market conditions. The purchases will be carried out on whatever scale is necessary to effect this outcome. The operation will be fully indemnified by HM Treasury."
A rough translation of which is "come and have a go if you think you are hard enough".
Or, alternatively, rather than going on Black the Bank and the government today have decided to place the economy and our collective savings on number 26.
Nah, this lot would not recklessly gamble it all on number 26. They would have gone for 42.
I don't think 1 voter in 20 understood what happened or why it happened on black Wednesday but they gleaned enough to realise that the Tories had screwed up the only thing they were supposed to be good at and it put them out of office for a generation. This is starting to get that sort of feel.
The election in 2024 may be a gonner but the Tories should start to worry about 2028, 2032, 2037, etc.
In theory yes provided Labour then sorted the economy out, got growth going and cut the deficit if it wins the next election.
If however a Labour government was accompanied by high inflation, strikes, recession, high taxes etc then we could be back to the 1970s and regular changes of government
I know we aren't meant to say this, but the £ has fallen off a cliff again. 1.05.
Nope i have just looked at the Pound in my pocket it is unaffected!
Only that Day Today sketch about the Pound being stolen can provide some relief on a day like today.
"The Bank of England is in chaos today following reports that The Pound has been stolen. The Pound was stolen from The Bank of England at approximately 12-40pm, by thieves dressed as cleaners."
The reason Sunak is quiet is that he is the author of the situation we are in.
It was Sunak who blew GBP400bn on thin air during covid, in a scheme ridden with profiteering and fraud, to almost universal applause on here and in parliament. The worst use of taxpaper money ever.
A very few of us questioned the sanity of this at the time, and asserted that banktupcty, or close to it, was the almost inevitable outcome of what Sunak and Johnson were doing. To almost universal derision.
And now here we f8cking are....
Disagree utterly. Every economy had to provide massive support to prevent the collapse of society under COVID.
Even more a reason not to go off piste which is what Truss and KK have done.
Every f8cking economy is suffering though matey, whatever their policy mix, do you not pay attention to the financial markets?
The Europeans are in a terrible position, maybe worse than us, and the Americans are looking at recession too.
Yep, everyone's F**ked, some are more than others.
Right now we're talking about the UK and this immediate crisis ok?? I don't see any panic in Washington or Brussels today.
The panic will spread very very quickly though. The implosion of the 5th largest economy in the world should it loom will make the GFC look like a one quarter recession.
The idea that things would be better under Sunak is for the birds. IF you borrow more than your economy can sustain, you are in trouble, whatever policy mix you have.
The UK will probably need huge spending cuts whoever is in charge. Under Sunak those cuts would have been gargantuan, because the economy would have been in a depression.
Furlough was an utterly insane and reckless gamble, and I suspect most tory MPs now realise this. No wonder they are so quiet.
The other half of your posts say, other countries are as fucked as we are. Which is it?
Leaving economics aside, the politics and presentation of these has been mind blowingly awful. The government and now the BoE seem to be finding ways to actively undermine themselves. The inexperience of Kwartang and Truss is breathtaking.
OK, finance boffins, what's the best realistic case from here?
Suppose KK goes, Truss is allowed to stay on condition that she stays sat at her desk, is very quiet and doesn't touch anything, Rishi returns to No 11...
What does he do? How much worse off are we all compared to the case where Last Week Didn't Happen?
The economics of it, I doubt anyone really knows, although some will pretend they do.
The politics of it are more clear cut. There is no way Truss and Kwasi can survive this. It's unprecedented as far as I know for a CoL in this country to destroy confidence in such rapid order.
On top of that, none of this has any political mandate from the country. Truss was not elected on a libertarian ticket, she was elected on the Boris pledge of levelling up .
Not only does the mini-budget call into question the financial stability of the country but it raises serious issues with our constitutional setup. We simply can't go through this process again with a new Prime Minister coming in, based on a tiny vote amongst a weird selectorate, and then just ripping up the manifesto / mandate that the governing party was elected upon.
Yeah, there is a legitimacy crisis here, too. Truss came in and has had, arguably, the worst first month as PM and it is mostly self inflicted. Even if the Tories got shot of her a) the Tory membership will cry foul and question why their mandate can so quickly be overturned and b) the country will ask why the Tory party is allowed to swap out PM after PM without going back to the country.
It could get very bad very quickly - if the economics of this continue and mortgage rates explode and pensions implode, that's the people typically sympathetic to the Tories buggered. When people take to the streets over inflation, food prices, energy costs and rent - those sympathetic Tories will instead be on their side rather than cheering for the coppers to bash their heads in. (Not to mention coppers may not be as heavy handed as usual given that austerity came for them too)
Two solid points to pick at:
1. Legitimacy of the PM. Constitutionally the rules are clear, but most voters think differently. Nobody votes for a Prime Minister or a political party, yet thats how most voters characterise how they vote. So whilst there is zero reason for PM Sunak to be considered illegitimate, he undoubtedly will. Not helped by the loon media (Express, Mail, GBeebies) who have nailed themselves to ship Truss and endlessly attacked Sunak already.
2. How will the Tories respond to riots? How do you think? The modern party sneers at people who disagree with it. So the people who can't pay their mortgage or afford heating or who just lost their teaching assistant job will be leftie remoaners always talking down britain, the enemies of the virtuous people like the hedge fund managers.
I know we aren't meant to say this, but the £ has fallen off a cliff again. 1.05.
Nope i have just looked at the Pound in my pocket it is unaffected!
It will be next time you buy anything priced in dollars. There is a reason we are seeing a rise in the price of so many of the tech and gadgets we all use - priced in dollars.
Your analogy of the car crossing over the motorway was good at the time and looks even better now, but i don't think we have hit a bus yet. There is a way out.
Truss has to sack Kamikwaze and replace him with someone sensible. There are lots of candidates (not Sunak though and he wouldn't accept anyway) but someone like Hammond or Hunt. The markets relax because there is now a grown-up in the room. Truss stays on for a bit, more of less devoid of power and credibility but as a figurehead she'll do until replaced in due course, before the GE, by somebody who should have got the job instead of her (probably, but not necessarily, Sunak.)
Of course the Tories then go down to a crushing defeat at the GE but that looks pretty much nailed on now anyway; however, the Country does not descend into chaos and turmoil. Labour come in to sort out the mess and the Tories go and have a bit of a rethink about what their purpose is.
In terms of your analogy, Leon, no fatal collision, but the police do flag the car down, take names and numbers and redirect the offender to the back of the queue on the right side of the road.
All very regular, all very calm, all thoroughly British.
Ahh, that all sounds very soothing. You busy? Want to be Chancellor?
Mr. Jonathan, not 'inexperience'. Truss has been a minister for ages. This is incompetence.
Truss has had a front row seat learning from masters: Cameron, May and Johnson. She has appeared to have learned lessons and distilled a leadership that somehow combines the worst aspects of each.
I cannot overstate that BoE intervention, précis, we’re fucked and this is the best we can do to sort out the fuck up by Truss and Kwarteng.
Yes. And still some posters argue that actually we're not fucked and look at Germany and actually its the fault of Sunak for not letting the economy collapse 2 years ago actually and aren't the IMF run be actual remoaners from the EU actually?
The first stage in any disaster recovery plan is to recognise that a disaster has occurred. And this government and its shills are too stupid to even accept this reality.
S Korea to mull temporarily banning short selling as fear spreads
Things are getting very messy indeed
The notion its just the UK, pedalled widely on here, is surely not correct. Where we differ is in our response to it.
The international community is unhappy because we refuse to simly accept going into a deep recession like the rest. We don't want to travel in the low growth convoy any more.
Here's what the high end Estate Agents are telling me as I hum and hah about just how big the coming fall in London property prices will be -
"With a massive state intervention energy package and rolling out tax cuts not seen for 50 years, there is already a renewed sense of purpose and confidence returning."
You have to just tip your hat sometimes, you really do.
I cannot overstate that BoE intervention, précis, we’re fucked and this is the best we can do to sort out the fuck up by Truss and Kwarteng.
Should I go to Burger King for my lunch, even though it's not my cheat day? This all has the feel of doom about it, and I wouldn't want to miss my chance to enjoy such luxuries before they become too expensive and the place gets looted by a local warlord... I promised myself a Domino's for Friday but I fear that might be too late.
I know this is a political website so posters tend to see things through the prism of politics and politicians. But my god, the Bank of England has shown itself to be a shit show. First they delayed the rate rise because of the queen. When it came, everyone with a vague interest could see we needed 75bps last week. And yet we had in her first meeting Swati Dingra, darling of the guardian for her “cancel Brexit” and “cost of living not inflation mantra” voting for 25bps, with Bailey and his chums going for halfway between her and the ones that know their game. And concerned themselves most with the back end of the gilt curve by announcing the dumping of £80bn on the market. This is despite them knowing the Fed and ECB had already raised by 75bps and having a preview of Kwasi’s mini budget.
When gilt yields spiked and the currency crashed, they froze and said the MPC still wouldn’t meet until November, while the market busily priced in big hikes. So the Financial Policy Committee today takes the bull by the horns and reverses the MPC’s bond selling action to try and arrest slide in long term gilts. But we still have no coordinated action from the MPC, so we should expect the currency to tank in the coming days unless they make a clear signal that they will make big rises. As in 175-200bps big.
MPC external appointees are chosen by a panel of Brownite Bank / Treasury servants, with “inclusivity” seemingly as important a qualification as any. How else do we get ultra dovish economists from Delhi and Buenos Aires on the MPC, places not exactly known for a competent inflation record.
I think we’re now in a standoff, with Bailey (by far the worst G7 central bank chief) refusing to take his queue from elected politicians and hoping that the government reverses the tax cuts. As if that would make a difference to market confidence at this point.
Sack the whole MPC, force them to reapply for their roles and remove the limit on how many terms you can serve (currently two 3-year terms).
Look Bailey has few fans here, but this isn't down to him today.
OK, finance boffins, what's the best realistic case from here?
Suppose KK goes, Truss is allowed to stay on condition that she stays sat at her desk, is very quiet and doesn't touch anything, Rishi returns to No 11...
What does he do? How much worse off are we all compared to the case where Last Week Didn't Happen?
The economics of it, I doubt anyone really knows, although some will pretend they do.
The politics of it are more clear cut. There is no way Truss and Kwasi can survive this. It's unprecedented as far as I know for a CoL in this country to destroy confidence in such rapid order.
On top of that, none of this has any political mandate from the country. Truss was not elected on a libertarian ticket, she was elected on the Boris pledge of levelling up .
Not only does the mini-budget call into question the financial stability of the country but it raises serious issues with our constitutional setup. We simply can't go through this process again with a new Prime Minister coming in, based on a tiny vote amongst a weird selectorate, and then just ripping up the manifesto / mandate that the governing party was elected upon.
Yeah, there is a legitimacy crisis here, too. Truss came in and has had, arguably, the worst first month as PM and it is mostly self inflicted. Even if the Tories got shot of her a) the Tory membership will cry foul and question why their mandate can so quickly be overturned and b) the country will ask why the Tory party is allowed to swap out PM after PM without going back to the country.
It could get very bad very quickly - if the economics of this continue and mortgage rates explode and pensions implode, that's the people typically sympathetic to the Tories buggered. When people take to the streets over inflation, food prices, energy costs and rent - those sympathetic Tories will instead be on their side rather than cheering for the coppers to bash their heads in. (Not to mention coppers may not be as heavy handed as usual given that austerity came for them too)
Two solid points to pick at:
1. Legitimacy of the PM. Constitutionally the rules are clear, but most voters think differently. Nobody votes for a Prime Minister or a political party, yet thats how most voters characterise how they vote. So whilst there is zero reason for PM Sunak to be considered illegitimate, he undoubtedly will. Not helped by the loon media (Express, Mail, GBeebies) who have nailed themselves to ship Truss and endlessly attacked Sunak already.
2. How will the Tories respond to riots? How do you think? The modern party sneers at people who disagree with it. So the people who can't pay their mortgage or afford heating or who just lost their teaching assistant job will be leftie remoaners always talking down britain, the enemies of the virtuous people like the hedge fund managers.
1) Constitutionally, I would argue, in these situations a GE is more typical than just swapping PM. It becomes even murkier considering the modern need for internal party democracy disempowering MPs and empowering the membership to essentially pick the PM. If it were MPs who chose the PM I think we would be on firmer constitutional ground - parliament is sovereign and can do what it wants.
2) I just think if the government loses their members by trashing their economic position, and ignoring their terms of membership to their party, that they would just believe the riots are justified, further eroding legitimacy. The thing about protests or even strikes have plurality or even majority support, but that Tory members typically don't support them en masse. I doubt many Tory voters would join a poll tax riot 2.0, but they wouldn't object to it happening, and therefore would not consent to the kind of policing needed to end it.
I cannot overstate that BoE intervention, précis, we’re fucked and this is the best we can do to sort out the fuck up by Truss and Kwarteng.
Yes. And still some posters argue that actually we're not fucked and look at Germany and actually its the fault of Sunak for not letting the economy collapse 2 years ago actually and aren't the IMF run be actual remoaners from the EU actually?
The first stage in any disaster recovery plan is to recognise that a disaster has occurred. And this government and its shills are too stupid to even accept this reality.
Your response is to re-appoint the people who crashed the car.....!
S Korea to mull temporarily banning short selling as fear spreads
Things are getting very messy indeed
The notion its just the UK, pedalled widely on here, is surely not correct. Where we differ is in our response to it.
The international community is unhappy because we refuse to simly accept going into a deep recession like the rest. We don't want to travel in the low growth convoy any more.
Quite frankly if the economy is fucked it doesn't particularly matter to me that there's a man in Titisee-Neustadt that has it just as bad.
It occurs to me the Her Majesty did Liz Truss a great favour by dying when she did, as without Her sudden death Truss would have torpedoed her Premiership in the first week, rather than in the third week.
I find it hard to see how Kwasi goes and Truss stays. Truss gets into office saying she’ll cut taxes, her chancellor cuts taxes, the economy falls off a cliff.
How can the person at the top retain any credibility? It’s for the birds.
That said the country cannot afford a leadership election right now.
"To achieve this, the Bank will carry out temporary purchases of long-dated UK government bonds from 28 September. The purpose of these purchases will be to restore orderly market conditions. The purchases will be carried out on whatever scale is necessary to effect this outcome. The operation will be fully indemnified by HM Treasury."
A rough translation of which is "come and have a go if you think you are hard enough".
Or, alternatively, rather than going on Black the Bank and the government today have decided to place the economy and our collective savings on number 26.
Nah, this lot would not recklessly gamble it all on number 26. They would have gone for 42.
Of course, those pseudo intellectual Oxbridge types. Of course they would.
I cannot overstate that BoE intervention, précis, we’re fucked and this is the best we can do to sort out the fuck up by Truss and Kwarteng.
Yes. And still some posters argue that actually we're not fucked and look at Germany and actually its the fault of Sunak for not letting the economy collapse 2 years ago actually and aren't the IMF run be actual remoaners from the EU actually?
The first stage in any disaster recovery plan is to recognise that a disaster has occurred. And this government and its shills are too stupid to even accept this reality.
Your response is to re-appoint the people who crashed the car.....!
Your analysis of who crashed the car is wrong. Your alternative to furlough - mass bankruptcies and unemployment - would have been worse.
The reason Sunak is quiet is that he is the author of the situation we are in.
It was Sunak who blew GBP400bn on thin air during covid, in a scheme ridden with profiteering and fraud, to almost universal applause on here and in parliament. The worst use of taxpaper money ever.
A very few of us questioned the sanity of this at the time, and asserted that banktupcty, or close to it, was the almost inevitable outcome of what Sunak and Johnson were doing. To almost universal derision.
And now here we f8cking are....
Disagree utterly. Every economy had to provide massive support to prevent the collapse of society under COVID.
Even more a reason not to go off piste which is what Truss and KK have done.
Every f8cking economy is suffering though matey, whatever their policy mix, do you not pay attention to the financial markets?
The Europeans are in a terrible position, maybe worse than us, and the Americans are looking at recession too.
Yep, everyone's F**ked, some are more than others.
Right now we're talking about the UK and this immediate crisis ok?? I don't see any panic in Washington or Brussels today.
The panic will spread very very quickly though. The implosion of the 5th largest economy in the world should it loom will make the GFC look like a one quarter recession.
The idea that things would be better under Sunak is for the birds. IF you borrow more than your economy can sustain, you are in trouble, whatever policy mix you have.
The UK will probably need huge spending cuts whoever is in charge. Under Sunak those cuts would have been gargantuan, because the economy would have been in a depression.
Furlough was an utterly insane and reckless gamble, and I suspect most tory MPs now realise this. No wonder they are so quiet.
Without furlough the lockdown wiuld have collapsed after a few weeks of course...which would have been a better outcone for all than 2 years of endless misery...thats on the tories too...misery then bankruptcy
I know this is a political website so posters tend to see things through the prism of politics and politicians. But my god, the Bank of England has shown itself to be a shit show. First they delayed the rate rise because of the queen. When it came, everyone with a vague interest could see we needed 75bps last week. And yet we had in her first meeting Swati Dingra, darling of the guardian for her “cancel Brexit” and “cost of living not inflation mantra” voting for 25bps, with Bailey and his chums going for halfway between her and the ones that know their game. And concerned themselves most with the back end of the gilt curve by announcing the dumping of £80bn on the market. This is despite them knowing the Fed and ECB had already raised by 75bps and having a preview of Kwasi’s mini budget.
When gilt yields spiked and the currency crashed, they froze and said the MPC still wouldn’t meet until November, while the market busily priced in big hikes. So the Financial Policy Committee today takes the bull by the horns and reverses the MPC’s bond selling action to try and arrest slide in long term gilts. But we still have no coordinated action from the MPC, so we should expect the currency to tank in the coming days unless they make a clear signal that they will make big rises. As in 175-200bps big.
MPC external appointees are chosen by a panel of Brownite Bank / Treasury servants, with “inclusivity” seemingly as important a qualification as any. How else do we get ultra dovish economists from Delhi and Buenos Aires on the MPC, places not exactly known for a competent inflation record.
I think we’re now in a standoff, with Bailey (by far the worst G7 central bank chief) refusing to take his queue from elected politicians and hoping that the government reverses the tax cuts. As if that would make a difference to market confidence at this point.
Sack the whole MPC, force them to reapply for their roles and remove the limit on how many terms you can serve (currently two 3-year terms).
Look Bailey has few fans here, but this isn't down to him today.
The reason Sunak is quiet is that he is the author of the situation we are in.
It was Sunak who blew GBP400bn on thin air during covid, in a scheme ridden with profiteering and fraud, to almost universal applause on here and in parliament. The worst use of taxpaper money ever.
A very few of us questioned the sanity of this at the time, and asserted that banktupcty, or close to it, was the almost inevitable outcome of what Sunak and Johnson were doing. To almost universal derision.
And now here we f8cking are....
So you would have let millions lose their jobs . The scheme had to be rushed out given the emergency so you were always going to have some fraud . But in terms of overall good, a failure to act would have been catastrophic for millions of people .
You can criticize Sunak on many things but I certainly won’t on this issue .
It feels to me like furlough in and of itself wasn’t the issue. The markets appreciated that the alternative (mass unemployment) would have made the situation even worse.
The issue is that the markets have been looking for at least a vaguely sensible post-Covid response. And borrowing to cut taxes isn’t vaguely sensible on top of everything else.
Is this the same Isabel who told us how wonderful the budget was going to be this time last week ? Creating an "aspiration nation" ? . The public credibility not just of post-Thatcherite Toryism but of the modern Tory press, as regards economics, is now history. We're entering a different era.
S Korea to mull temporarily banning short selling as fear spreads
Things are getting very messy indeed
I am presuming that the Nord 1 problems are why the futures price for gas has really jumped again the last few days breaking the trend down. The timing is unhelpful to say the least. It looks as if the government bung could end up costing a few tens of billions* after all.
The reason Sunak is quiet is that he is the author of the situation we are in.
It was Sunak who blew GBP400bn on thin air during covid, in a scheme ridden with profiteering and fraud, to almost universal applause on here and in parliament. The worst use of taxpaper money ever.
A very few of us questioned the sanity of this at the time, and asserted that banktupcty, or close to it, was the almost inevitable outcome of what Sunak and Johnson were doing. To almost universal derision.
And now here we f8cking are....
So you would have let millions lose their jobs . The scheme had to be rushed out given the emergency so you were always going to have some fraud . But in terms of overall good, a failure to act would have been catastrophic for millions of people .
You can criticize Sunak on many things but I certainly won’t on this issue .
The answer is, was and always should have been no lock-down at all. The vulnerable should have shut themselves away and the rest of us should have got on with it. We destroyed the economy, spent wad-loads of money we didn't have to save a few thousand people who would have kicked-it soon anyway. No use in crying about it now. GBP 400bn to "save" 100k people? A bargain.
The reason Sunak is quiet is that he is the author of the situation we are in.
It was Sunak who blew GBP400bn on thin air during covid, in a scheme ridden with profiteering and fraud, to almost universal applause on here and in parliament. The worst use of taxpaper money ever.
A very few of us questioned the sanity of this at the time, and asserted that banktupcty, or close to it, was the almost inevitable outcome of what Sunak and Johnson were doing. To almost universal derision.
And now here we f8cking are....
So you would have let millions lose their jobs . The scheme had to be rushed out given the emergency so you were always going to have some fraud . But in terms of overall good, a failure to act would have been catastrophic for millions of people .
You can criticize Sunak on many things but I certainly won’t on this issue .
The answer is, was and always should have been no lock-down at all. The vulnerable should have shut themselves away and the rest of us should have got on with it. We destroyed the economy, spent wad-loads of money we didn't have to save a few thousand people who would have kicked-it soon anyway. No use in crying about it now. GBP 400bn to "save" 100k people? A bargain.
How were you going to tell the difference between the “vulnerable” and the “non-vulnerable” exactly?
Half the working age population over 45 probably has some factor that increased their covid risk (diabetes, weight, asthma etc etc)
And, as has been repeated ad nauseum by people here & elsewhere, once you exceed the capacity of your healthcare system to cope with the current infection rate, your death rate soars. Exactly how many mililion people were you planning to slaughter with your “no lockdown at all, ever” strategy?
Post vaccines, this trade-off changes & there are arguments both ways, but pre-vaccine? Then the choices were stark.
Comments
Even more a reason not to go off piste which is what Truss and KK have done.
The same journalists who were questioning why we weren't locking down harder and spending more on furlough, are now worried about our financial situation.
If Truss and Kwarteng, and all the tories, have finally stopped listening to these brainless parrots, and stopped treating them seriously, good.
I suspect they have, because they cannot stand up a single tory MP to criticise the government.
You reduce paperwork.
Do you get a bonus?
Well, you’ve probably reduced the size of your team. So they will cut your budget. Because you have less reports, you are less important - that’s promotion fucked. And you manager is angry because his empire has shrunk…
In the commercial works, it takes high level management backing and lots of guys to actually cut costs.
At a casual guess, I could reduce the DVLA staffing by 80% - it would take some hundreds of millions and several years for putting the automation in. And you’d probably want to hire better (and more expensive) people for the positions left.
The result would be faster service, better scaling. And would be politically impossible, probably.
Yes, that’s my suspicion
The world is slowly tip toeing along a cliff top. Blindfold. The precipice represents total loss in economic confidence. Western nations in particular are roped together
Britain’s mistake was to break ranks “confidently” so as to speed up progress. Instead we now have one leg dangled over the edge
But we are tugging others with us. And others are
also in trouble (for other reasons)
Perilous
The Europeans are in a terrible position, maybe worse than us, and the Americans are looking at recession too.
It could get very bad very quickly - if the economics of this continue and mortgage rates explode and pensions implode, that's the people typically sympathetic to the Tories buggered. When people take to the streets over inflation, food prices, energy costs and rent - those sympathetic Tories will instead be on their side rather than cheering for the coppers to bash their heads in. (Not to mention coppers may not be as heavy handed as usual given that austerity came for them too)
Who hasn’t caught a glimpse of themselves staring up from an iPad/phone with a triple chin and looking about 94 years old?!
It’s not a flattering angle
The election in 2024 may be a gonner but the Tories should start to worry about 2028, 2032, 2037, etc.
Right now we're talking about the UK and this immediate crisis ok?? I don't see any panic in Washington or Brussels today.
These are not only harder to sell they are having to sell at a significant discount too.
32KG lost in 16 weeks
Now, it's open to debate whether Covid was a crisis that justified massive borrowing, but that argument is irrelevant had the government kept to the other side of the bargain - to repay the debt incurred once the crisis had passed.
What the government made clear last week is that they had no interest in repaying the debt, instead they were going to massively expand it to pay for tax cuts. That's why confidence has gone. That's why we're in trouble.
"The Bank of England is in chaos today following the discovery that The Pound has been stolen. The Pound was stolen at 1-30 today, by thieves dressed as cleaners."
https://digg.com/video/day-today-sketch-from-1994-pound-stolen
All those assets that the right sort of people could pick up for a song, and a mass labour pool of desperate plebs to exploit. Won't anyone think of the profits lost????
When gilt yields spiked and the currency crashed, they froze and said the MPC still wouldn’t meet until November, while the market busily priced in big hikes. So the Financial Policy Committee today takes the bull by the horns and reverses the MPC’s bond selling action to try and arrest slide in long term gilts. But we still have no coordinated action from the MPC, so we should expect the currency to tank in the coming days unless they make a clear signal that they will make big rises. As in 175-200bps big.
MPC external appointees are chosen by a panel of Brownite Bank / Treasury servants, with “inclusivity” seemingly as important a qualification as any. How else do we get ultra dovish economists from Delhi and Buenos Aires on the MPC, places not exactly known for a competent inflation record.
I think we’re now in a standoff, with Bailey (by far the worst G7 central bank chief) refusing to take his queue from elected politicians and hoping that the government reverses the tax cuts. As if that would make a difference to market confidence at this point.
Sack the whole MPC, force them to reapply for their roles and remove the limit on how many terms you can serve (currently two 3-year terms).
Your analogy of the car crossing over the motorway was good at the time and looks even better now, but i don't think we have hit a bus yet. There is a way out.
Truss has to sack Kamikwaze and replace him with someone sensible. There are lots of candidates (not Sunak though and he wouldn't accept anyway) but someone like Hammond or Hunt. The markets relax because there is now a grown-up in the room. Truss stays on for a bit, more of less devoid of power and credibility but as a figurehead she'll do until replaced in due course, before the GE, by somebody who should have got the job instead of her (probably, but not necessarily, Sunak.)
Of course the Tories then go down to a crushing defeat at the GE but that looks pretty much nailed on now anyway; however, the Country does not descend into chaos and turmoil. Labour come in to sort out the mess and the Tories go and have a bit of a rethink about what their purpose is.
In terms of your analogy, Leon, no fatal collision, but the police do flag the car down, take names and numbers and redirect the offender to the back of the queue on the right side of the road.
All very regular, all very calm, all thoroughly British.
The UK will probably need huge spending cuts whoever is in charge. Under Sunak those cuts would have been gargantuan, because the economy would have been in a depression.
Furlough was an utterly insane and reckless gamble, and I suspect most tory MPs now realise this. No wonder they are so quiet.
If however a Labour government was accompanied by high inflation, strikes, recession,
high taxes etc then we could be back to the 1970s and regular changes of government
https://www.youtube.com/watch?v=32779CpfymI
The one way Labour doesn’t win in 2025 is to bang on about Brexit.
What’s 32kg in pounds? Presumably a lot more than it was last week…
1. Legitimacy of the PM. Constitutionally the rules are clear, but most voters think differently. Nobody votes for a Prime Minister or a political party, yet thats how most voters characterise how they vote. So whilst there is zero reason for PM Sunak to be considered illegitimate, he undoubtedly will. Not helped by the loon media (Express, Mail, GBeebies) who have nailed themselves to ship Truss and endlessly attacked Sunak already.
2. How will the Tories respond to riots? How do you think? The modern party sneers at people who disagree with it. So the people who can't pay their mortgage or afford heating or who just lost their teaching assistant job will be leftie remoaners always talking down britain, the enemies of the virtuous people like the hedge fund managers.
Germany fear the Nord 1 permanently fucked
S Korea to mull temporarily banning short selling as fear spreads
Things are getting very messy indeed
I cannot overstate that BoE intervention, précis, we’re fucked and this is the best we can do to sort out the fuck up by Truss and Kwarteng.
There is no political touch whatsoever.
The first stage in any disaster recovery plan is to recognise that a disaster has occurred. And this government and its shills are too stupid to even accept this reality.
The international community is unhappy because we refuse to simly accept going into a deep recession like the rest. We don't want to travel in the low growth convoy any more.
"With a massive state intervention energy package and rolling out tax cuts not seen for 50 years, there is already a renewed sense of purpose and confidence returning."
You have to just tip your hat sometimes, you really do.
2) I just think if the government loses their members by trashing their economic position, and ignoring their terms of membership to their party, that they would just believe the riots are justified, further eroding legitimacy. The thing about protests or even strikes have plurality or even majority support, but that Tory members typically don't support them en masse. I doubt many Tory voters would join a poll tax riot 2.0, but they wouldn't object to it happening, and therefore would not consent to the kind of policing needed to end it.
How can the person at the top retain any credibility? It’s for the birds.
That said the country cannot afford a leadership election right now.
For the rest of her life she is the PM that crashed the economy on day 1
Even Russian social media recognizes the AFU encirclement of Lyman is almost complete.
That reservoir is an uncrossable water obstacle for Russian AFV's & trucks with no intact bridges across it.
If Russia starts evacuating now, it will get it's people out w/o most material.
https://twitter.com/TrentTelenko/status/1575099635986993154
You can criticize Sunak on many things but I certainly won’t on this issue .
https://twitter.com/IsabelOakeshott/status/1575100358380376065
12.65*365= 4617 days
Days since the death of the Queen = 20
Financial crises during the reign of Charles III = 231
The issue is that the markets have been looking for at least a vaguely sensible post-Covid response. And borrowing to cut taxes isn’t vaguely sensible on top of everything else.
.
The public credibility not just of post-Thatcherite Toryism but of the modern Tory press, as regards economics, is now history. We're entering a different era.
*Roughly $15
Maybe she meant pensions funds would be aspiring to pay out benefits?
Who gains? LNG exporters. Its the Qataris wot done it.
Half the working age population over 45 probably has some factor that increased their covid risk (diabetes, weight, asthma etc etc)
And, as has been repeated ad nauseum by people here & elsewhere, once you exceed the capacity of your healthcare system to cope with the current infection rate, your death rate soars. Exactly how many mililion people were you planning to slaughter with your “no lockdown at all, ever” strategy?
Post vaccines, this trade-off changes & there are arguments both ways, but pre-vaccine? Then the choices were stark.