Brexit WTF, WTF

dogwatch

Super Anarchist
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South Coast, UK
The Tory party is its current form has existed since the late 18th century, in government much of that time. Whether or not you find its politics to your tastes, it has always been capable of forming functioning governments. Since 2016 it has lost its collective mind and the ability to put together a competent leadership. I wonder if it will ever recover it. Plenty of historically important parties have evaporated elsewhere in Europe in recent decades, there is no obvious reason why that should be impossible in the UK.

Meanwhile this conclusion from a piece by the editor of Conservative Home. That is, in effect, the house website of the Tory party.

Instead of seeking to consolidate her vulnerable position (having won a lower share of the votes of her colleagues than any Tory leader elected under the present system) she has thrown caution to the winds, snubbing most of the two-thirds of the Parliamentary Party that didn’t vote for her.

Above all, rather than shield Britain from the markets at a time of international turmoil, she and the Chancellor have painted a target on its back – to the point where they’re getting no credit for the energy bailout they will lavish tens of billions on. To date, her Government is a catalogue of recklessness and incompetence.

To begin to work its way back, she doesn’t have to embrace the IMF, yield to the Guardian, go woke, bring the date of Net Zero forward, kiss and make up with the Northern Ireland Protocol, or relax immigration controls (please note) – let alone renounce Brexit.

What she might want to do instead is grasp that government is not a laboratory, budgets are not experiments, blowing the roof off isn’t home improvement, and communication isn’t telling everyone that you’re always right. And apologise for fouling her own nest, the Party’s and the country’s. Perhaps competence is too much to ask for, but can we please have a little humility?


Well that was a short honeymoon. https://conservativehome.com/2022/0...ment-capable-of-engaging-with-the-real-world/
 
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Beyond rate rises, the next economic requirement will be government austerity, which won't go down well with the public.
Every country in the world is in that situation. We’ve all over spent and rely on debt to cover up the cracks.

France, hah how can the markets react when the Euro comes into play, at the moment the Euro is too big to fail much like the dollar, but that day when the markets surmise that the Euro economy on a whole is so shit that they have to react, can’t be far away.
 

LeoV

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Keep dreaming.

In short, the UK is not in a bad position but not in a stellar one either, pity the leaders are stupid. Tax cuts for the rich. Without a plan behind it. Just a dogma. That is what scares investors.

And comparing to the G7 is fun, UK is in the same situation as the other countries is the argument...
But do you think there may be a link between being the only G7 country not to have recovered your pre-covid economy and being the only G7 country to have put up trade barriers to all neighbours in the meantime?

Free from the EU shackles the UK should do better. Not.
 

dfw_sailor

Super Anarchist
1,473
608
DFW
Every country in the world is in that situation. We’ve all over spent and rely on debt to cover up the cracks.

France, hah how can the markets react when the Euro comes into play, at the moment the Euro is too big to fail much like the dollar, but that day when the markets surmise that the Euro economy on a whole is so shit that they have to react, can’t be far away.
You're leaving out the market sentiment which is Britain is no longer Britain, being governed on a idealogical basis instead of being pragmatic, and therefore carries higher asset risk.

So, the government has a choice, higher rates vs lower currency.

A point will be reached where rates don't do it anymore, and the government will be forced to save money / cut services, but still keep rates high.

It's the combination of high rates and austerity that will hit England harder. It's a double whammy.

Or they could choose to allow the currency to tank, but England is a net importer so that would hurt.

Or the pollies get their act together (eye roll), and investors regain confidence in governance.
 
Or they could choose to allow the currency to tank,
1664553171375.png

And rising fast, was it a media storm in a tea cup, the Hedgies having made their money and now backing out or just a bit of sabre rattling by the Liz Truss haters ?

Interesting to hear the interview with the City boy on LBC touting how he's made millions for his Bank over the last few days, seems a tad wrong and if there are any Labour MP's listening, you should be calling ( as you have done for every other high earning company ) for an immediate windfall tax on city traders and banks to pay for everyones rise in mortgage rate, which the media caused with their over exaggeration of the tax cut to the highest earners.
 

dfw_sailor

Super Anarchist
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608
DFW
View attachment 543920
And rising fast, was it a media storm in a tea cup, the Hedgies having made their money and now backing out or just a bit of sabre rattling by the Liz Truss haters ?

Interesting to hear the interview with the City boy on LBC touting how he's made millions for his Bank over the last few days, seems a tad wrong and if there are any Labour MP's listening, you should be calling ( as you have done for every other high earning company ) for an immediate windfall tax on city traders and banks to pay for everyones rise in mortgage rate, which the media caused with their over exaggeration of the tax cut to the highest earners.
As long as traders cover their positions so they can sleep at night, they love volume and volatility.

Medium to long term investing puts bread and butter on the table. Volatility brings in the cream, until the floor falls out.

Have a look to what happened in Australia in the 70s through early 90s.

Poor economic decisions (on both sides) results in a badly functioning economy, 'banana republic', tanking dollar, super high interest rates, massive cuts to government spending, and finally a somewhat restructured economy that is fortunate to have undergone a 30 year commodity boom.

Regarding the currency, id be keeping an eye out for a double top over the next 6 months. Depends on how good or bad the pollies are.
 

dfw_sailor

Super Anarchist
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608
DFW
Another interesting observation you pointed out was how the coupling of the French to the euro was shielding them.

My gut feel is before brexit, before joining the common market, the Brits were reasonably ok with managing the economy. While in the common market, the Brits helped set economic agenda, and of course the street did very well. Brits complained about the euro economies that dragged (Greece / Italy etc) but overall there was respect for solidity of Britain.

Or to put it another more succint way, pre brexit sterling had an almost reserve currency status, and post brexit/trickle down tax cuts it is now just another currency with a a government that is not focused on the fundamentals, therefore greater risk.

Wayne, I know we are not going to agree, but it is a viewpoint you may want to consider.

Back to f'ing painting the deck, cockpit etc.
 
Another interesting observation you pointed out was how the coupling of the French to the euro was shielding them.

My gut feel is before brexit, before joining the common market, the Brits were reasonably ok with managing the economy. While in the common market, the Brits helped set economic agenda, and of course the street did very well. Brits complained about the euro economies that dragged (Greece / Italy etc) but overall there was respect for solidity of Britain.

Or to put it another more succint way, pre brexit sterling had an almost reserve currency status, and post brexit/trickle down tax cuts it is now just another currency with a a government that is not focused on the fundamentals, therefore greater risk.

Wayne, I know we are not going to agree, but it is a viewpoint you may want to consider.

Back to f'ing painting the deck, cockpit etc.
Oddly enough I fully agree, the pound was over valued for most of the early pre 2010’s running in that 1.60 - $ 1.40’s until Brexit where it fell back into the $ 1.40 - 1.20’s to the $, probably it’s true value.

But what about the German Ponzi scheme called the Euro, in the 2022 it’s only major contributor left has hit a buffer, no more cheap energy. Can the printing presses that are now propping up virtually every country in the EU prevent another Sovereign Debt Crisis. Here’s some reading for you.


 
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dogwatch

Super Anarchist
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South Coast, UK
The irony for me is that I think scrapping the 45p rate is a good idea in principal. Just that it is politically tone-deaf at this moment. I guess removal of the cap on banker's bonuses stands at the point, on which I could make the same comment.
 

FinnFish

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Why the fuck, just for once, can't we get someone competent in charge?
You're choices up there are about as limited as ours down here. It really doesn't matter whether you choose the Red Team or the Blue Team, both parties are composed of self-interested hopeless fuckwits.
 

MiddayGun

Super Anarchist
1,178
442
Yorkshire
You're choices up there are about as limited as ours down here. It really doesn't matter whether you choose the Red Team or the Blue Team, both parties are composed of self-interested hopeless fuckwits.

Yes I think Douglas Adams said it best: "Anyone who is capable of getting themselves made President should on no account be allowed to do the job"

Or Terry Pratchett.
"“We put all our politicians in prison as soon as they’re elected. Don’t you?” “Why?” “It saves time.”"
 

dogwatch

Super Anarchist
16,833
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South Coast, UK
Read this morning https://www.spectator.co.uk/article/why-would-tory-mps-trust-truss-now- . Our new Chancellor, notoriously, knows best on all subjects.

Before he U-turned, I understand that Kwasi Kwarteng was inviting Tory backbenchers into his hotel room one by one to listen to their concerns. The conversations were not just about the 45p rate. In fact, the MPs who I've spoken to say they were even more forceful with him on the risks of not uprating benefits in line with inflation. He was warned by a number of them yesterday that this would be 'disastrous'. Was he listening to this? 'He was Kwasi-listening,' quips one MP.
 

LeoV

Super Anarchist
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The Netherlands
EU Membership Voting Intention:
Join: 46% (+1) Stay out: 36% (-1)
via @YouGov, 20-21 Sep (Changes with 5 Aug)

As no interest voters will not vote, I would say the will of the people should be followed and a new referendum...
 
EU Membership Voting Intention:
Join: 46% (+1) Stay out: 36% (-1)
via @YouGov, 20-21 Sep (Changes with 5 Aug)

As no interest voters will not vote, I would say the will of the people should be followed and a new referendum...
Really LeoV, the EU is way down the pecking order at the moment, I’m surprised YouGov could find enough people that was bothered to give the time, I guess that would be just hardened Remainers then.

But then I guess the inflation rate in Euroland would soon kill any hope of reunification, what is it in your back garden, 17% ?
 

Jambalaya

Super Anarchist
6,691
105
Hamble / Paris
FWIW I spent 35 years in finance as a trader with firms like Goldman Sachs, Deutsche Bank and various hedge funds ... so my 2p on the markets follows.

Traders have been short pound and euro for months vs USD. The Fed have been much more agressive in raising rates so it has been an easy bet. Both £ and € are down heavily vs $. The markets didn't like the Truss budget as the energy price cap was open ended with an annual cost of £60-80bn (?) which was to be paid for by yet more borrowing. The pound has since rebounded

The removal of the 45% tax rate (initially brought in as temporary by Labour after financial crash) was politically stupid in current circumstances but was virtually cost free. It currently raises £2bn and many economists think removing it (so top rate is 40) would actually raise MORE money

Truss has certainly got off to a bad start allowing the 45p debacle to overshadow the many good things she has already done.

She has also weakened herself in eyes of UK and I will say Brussels who will see her rather differently now. The Northern Ireland Protocol needs to go, either via A16 trigger and renegotiation or unilateral action
 

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