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It started in Threadneedle Street will not work for the government – politicalbetting.com
It started in Threadneedle Street will not work for the government – politicalbetting.com
Who bears the most responsibility for keeping inflation under control?The government: 50%Bank of England: 32%Other: 2%Don't know: 16%https://t.co/EvVzSs0nY1 pic.twitter.com/RHQWxfCc9S
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https://en.wikipedia.org/wiki/Nukus
Rates should have been creeping up well before the pandemic, and the Bank should have been much closer to the Fed in raising rates in the past year.
So far I have noticed some changes from the revised boundaries published at the end of last year in Wales around Swansea - there are some in North Wales. as well.
Doesn't mean they haven't done badly, but they're not the only ones.
But the bottom line was that Sunak was a twit to make the pledge.
https://www.bcs2023review.com/
https://bcomm-wales.gov.uk/reviews/06-23/2023-parliamentary-review-final-recommendations
https://www.boundarycommission.org.uk/2023-review-parliamentary-constituencies
Rising costs and strained household finances are causing some families to weigh-up whether sending children to private schools is still worth the money and effort.
School fees have been rising for more than a decade and earlier this week the Telegraph revealed how stagnating wages means middle-class parents can no longer afford places at the most prestigious schools.
On top of that, pupils who attended private schools – and whose families paid tens of thousands of pounds to do so – are finding it increasingly difficult to get places in top British universities amid a surge in competition from state schools.
While some families still swear by the education provided by Britain’s best-known schools, growing numbers of parents are wondering whether it is worth the financial sacrifice.
https://www.telegraph.co.uk/money/consumer-affairs/private-school-fees-are-they-worth-it-uk/
Spoiler alert: It is absolutely worth every penny.
Low turnout nailed on, I reckon.
FTFY.
Well, of course low turnout, it's a by election
Overstepping.
Thames Water is in talks to secure extra funding as the government says it is ready to act in a worst case scenario if the company collapses.
The water firm, which serves a quarter of the UK population, has billions in debt and is under pressure with its boss resigning unexpectedly on Tuesday.
The government said "a lot of work is going on behind the scenes" and it had a process in place "if necessary".
https://www.bbc.co.uk/news/business-66039170
But that's nonsense. The BoE has been given other jobs - like printing money in a crisis (under new names), which conflict with inflation control. And further, governments can control inflation, if they wish, by raising taxes and spending less which is just as good a way of reducing demand. So for votes reasons they pretend its all down to the BoE.
The practical upshot would be that equity holders (the Macquarie Infrastructure Fund) would be wiped out, the debt would be written down to 60 cents in the dollar, and the lenders would end up in possession of the equity.
Ahem.
Six years ago, she had just become an MP.
No doubt the answer would be "Liz Truss".
So yes, the BoE and MPC are culpable not only for not meeting the 2% target, but not even trying to. However the Chancellor of the Exchequer is also culpable for making those appointments.
Inflation can be described as too much money chasing too few goods/supplies. BofE is making money more costly, the left hand element of the equation. The Truss experiment would have chucked more money into the system (reducing taxes etc.), so government also has a big impact on the amount of money. This was part of the Truss problem as it was unclear that the BofE and government were working together to reduce inflation.
The right hand is also under the government control and were part of the Thatcherite supply side changes to the economy. By increasing restrictions - such as on imported goods/people etc. - this has the effect of facilitating increases in inflation.
So the government has many more levers to play with than the BofE to reduce inflation.
Historically it was said that changes in interest rates took 2 years to feed through. I do not know whether this is still true in today's economy.
if you don't have any of the above then they probably still are
https://boundarycommissionforengland.independent.gov.uk/2023-review/
@Peston
Part of the financial squeeze on Thames Water stems from both the amount of debt on its balance sheet - some £14bn, generating a relatively high debt-to-equity or gearing ratio of 80% - and the proportion of that debt whose interest payments are linked to inflation. I've looked at the accounts of its financing company, Thames Water Utilities Finance plc. This lists 13 index-linked or inflation-proof bonds with a total value of £3.35bn, as of spring last year. Many of these bonds don't fall due for 10 or 20 years. This implies that every 1% increase in inflation is costing the company a painful £34m a year. It is possible - perhaps likely - that some of this inflation exposure is hedged. But on the basis of what's happened to UK inflation over the past 18 months, the additional annual interest cost on these bonds for the company could plausibly be £200m, a non-trivial sum for a company seeking to raise £1bn in additional equity.
£200m is a sizeable additional cost when income is fixed...
Given that the bond holders are some of the financial institutions which fund government debt (Kuwait investment office etc), government is likely to be less than draconian in its treatment of them.
In any event, expect water bills to climb steadily.
Like Indy, I hate spiders.
Stowaway African huntsman spider found in Edinburgh suitcase
The adventurous arachnid was discovered at a property in the Scottish capital after the resident returned from a work placement in Africa. Huntsman spiders use venom to immobilise their prey and can grow up to 30cm in leg span.
https://news.sky.com/story/stowaway-african-huntsman-spider-found-in-edinburgh-suitcase-12911116
Plus you can claim to be From Der Staines Massive at interview. Coaching an accent may be required.
Idiots.
Ashes look lost to me though.
Bad toss to win today.
Would you like some help with that today?
YES NO
"We've been liaising with our contacts and have a home down in Kent lined up with a specialist where this huntsman can happily live out the rest of their life."
This pronoun thing is getting even more ridiculous
"Snakes! Why did it have to be snakes?!"
1. Sir John A. Macdonald > a father of confederation, first PM of new dominion, with both physical & political resemblance to Benjamin Disraeli; the 1891 election was his last hurrah, he died in office following June; succeeded by
2. Sir John Abbot > compromise choice, senator not MP, his period in office was marked by economic depression and government scandal; burdens of office contributed to his failing health, he resigned and died soon after; succeed by
3. Sir John Thompson > most able leader upon Macdonald's death, but he declined premiership at that time due to his Catholic religion, which was HIGHLY divisive issue then in Canada, and especially within Tory Party; however he was obvious choice to take over from Abbot, and was reasonably successful . . . until he suffered sudden heart attack and died in office in 1894; to be succeed by
4. Sir Mackenzie Bowell > who to balance out his RC predecessor, was a past Grandmaster of the Orange Order of British North America, ran on the rocks of the Manitoba Schools issue concerning how to renege on guarantees to French-speaking Metis when Manitoba entered Confederation, goal supported by growing numbers of English-speaking Manitobans and (naturally) Canadian Orangemen who were numerous esp. in Ontario; during his term as PM, Bowell was overshadowed by HIS sucessor
5. Sir Charles Tupper > also a Father of Confederation, and former premier of Nova Scotia, Tupper was a stormy petrel in Canadian politics for decades; his support for Bowell was predicated on B yielding the title as well as substance of PM-ship for the 1896 general election; only served 68 days in office (still the Canuck record) before resigning in wake of Tory defeat and landslide Liberal victory under Sir Wilfred Laurier, Canada's first francophone PM, who remained in office with his fellow Grits for next 16 years.
Addendum - don't know IF Sir John A. Macdonald was scared of snakes, but he reported seeing them quite frequently, even during blizzards in tropical Ottawa.
This may be partly because changes to the structure of the mortgage market mean that interest rate rises fall very heavily on that small subset of home owners whose fixed-rate deals happen to be coming to an end, but don't immediately affect other mortgage holders, or the increased proportion of people who own their house outright. The transmission mechanism of interest-rate changes is supposed to be to tweak aggregate demand, but this is a very crude way of doing it and causes a lot of pain to the smallish number of people it hits, as well as acting very slowly compared with how it did back in 1980s when nearly all mortgages were variable-rate. (I'm simplifying slightly here, because there's also an effect on companies, but you get the idea).
However, interest rate changes are not the only way of tweaking aggregate demand, you can also do it through taxation. Maybe we should go back to considering the two together, rather than leaving central banks with the responsibility to control inflation but with only one mechanism which is slow-acting and rather arbitrary in terms of who it affects.
Heck it seems businesses are desperately working to maximise the amount of tax their pay at 25% of their profits by increasing their profits as quickly and as highly as possible (Remember that one of the biggest supposed reasons behind the inflation figures is corporations seeking to increase profits).
IMpressive place of which I had never heard, in W. London.
1. As you say, the results have not been encouraging to say the least;
2. To paraphrase, interest rates are too important to be left to the Bankers. That is especially the case in an economy in the UK which is both heavily property dependent and over reliant on short-term mortgages;
3. There is the risk of an uncoordinated policy (as you say, taxation and interest rates not being coordinated together).
I think a lot of the problem is the narrow mindset of the people in charge of central banks today who cut their teeth and were at university in the 1970s and 1980s and so accepted the then orthodoxy that interest rates were the only way to curb inflation. Even a narrow reading of the causes of today's inflation will show that interest rate rises only impact a segment of the drivers, and even that segment may have been dealt with more effectively by taxation policy. Also note, in 1945 for example, when there was a similar inflation spike and on similar grounds, central banks eschewed the interest rate rise policy.
(Although you won't like my next post
If the results are not impressive now, they sure as hell weren’t before-hand.
Two points:
1. I agree that the transmission of interest rates into the homebuying economy doesn’t work as well anymore. But that’s a fix to investigate, not a wholesale surrender of independence.
2. The government has a role too, and not just in keeping public sector wages down. The government is stoking inflation with the triple lock, and refuses to look at supply side (market) reform. Evidence is growing that at least some of this inflation is price gouging. Too many sectors in the UK run as effective oligopolies.
How he got this far, and won the endorsement of so many heavy hitters, is the real question.
Economics itself has realised this is an issue which is why there is more teaching of economic history and context in economic courses these days but the people who are at the top now are still rooted in theoretical thinking. It is Soviet-style thinking in the modern era.
I would argue there were two major instances where the politicians got it majorly wrong on interest rates:
1. 1981 when Geoffrey Howe spiked interest rates far in excess of what was needed and destroyed large swathes of industry that (arguably) could have been reformed and saved.
2. 1992 and Black Wednesday with the run on the pound.
The thing is that in both these cases I do not think the actions of the central bankers would have been different to the politicians.