The FT reckons the Tories are eyeing up a shares sale of some of some of the UKFI Ltd portfolio, this follows Myners on the weekend claiming to Adam Boulton that the taxpayer was sitting on a little nest egg investment in the banking system.  Perhaps, if you ignore the financial black hole that is Northern Crock.

Don’t get too excited.  Moodys has just released research suggesting we will see further losses of around £130 billion from the loan books and securities portfolios of rated UK financial institutions.  The UK economy is nowhere near out of the hole yet:

• We are in a fifth consecutive quarter of recession.
• Real GDP fell 0.8% quarter-on-quarter.
• Output has fallen 5.6% year-on-year, the worst since records began in 1955.
• The Bank of England base rate at 0.5%, is the lowest rate since the central bank was founded in 1694.
• The Old Lady has eased £125 billion of new electronic money into the economy to create a false market in government gilts.
• Nevertheless, the efforts thus far have met with little success: net bank lending to individuals fell to a fresh record low in June, net lending to U.K. businesses has slipped into negative territory in recent months, as repayments exceeded new loans. Sid is saving to pay down debt – unlike Gordon.

Guido’s advice to Sid: buy a little gold for insurance, invest in inflation linked securities  and neither the great British pound or the U.S. dollar are great places to be. Pop one of Gordon’s happy pills, we ain’t out of it yet…

Of all the right-of-centre think tanks the libertarian-leaning Adam Smith Institute has always been a bit more spikey and willing to push the envelope than rival think tanks in Westminster wonk-land.

In economics the ASI was the mid-wife of Thatcher’s privatisation strategies which were exported around the world (the separate consulting arm spun-off from the institute advises foreign governments worldwide to this day). In the last decade it has (to little  avail) been putting the case for not just lower taxes, but flatter and simpler taxes.  Until now the wider libertarian social agenda was seemingly off limits and left to the various pressure groups and single-issue campaigns.

Madsen Pirie has never dodged the drugs liberalisation question in the past but the ASI has never pushed the policy until now.  Madsen Pirie told Guido he felt that the “war on drugs” approach had now been tested to destruction and that the political environment was more “convivial” to drug liberalisation.  Guido asked him “Do you mean that because we have a former self-confessed coke-head in the White House and a former stoner heading for Downing Street we might see change?” Diplomatically he replied “Well, it is fair to say, this generation of ministers will be more familiar with the issues.”

Zero Base Policy has 32 other manifesto recommendations…

UPDATE : Claudia Rubin from the Release campaign says

the last significant drug policy measure in the UK was implemented by Margaret Thatcher with the introduction of the needle exchange programme and it is fitting therefore that the ASI should be taking this view. Were he to become Prime Minister next year, David Cameron could mark 40 years of the failure of prohibition by doing something really necessary and sensible.

Phillip Oppenheim, a former Conservative Treasury minister in charge of Customs says in an interview out today that in office he tried to push government policy in a progressive direction.  There is nothing progressive about locking people up for smoking weed…