Monday, November 24, 2008

Rich & Mark’s Monday Morning View

Sunday, November 23, 2008

Fear and Loathing in Leeds

Guido hears that the Cabinet will be meeting in Leeds on Friday – same drill as the last time in Brum – the public in the form of carefully chosen invitees, mostly from the public sector, will be the backdrop for a Potemkin Village show for the evening news.

Local large private businesses must be in fear that the cabinet will visit. Since the Birmingham Cabinet meeting when Gordon visited Jaguar the company’s sales have collapsed. Jaguar’s parent company JLR is now begging the government for a £1 billion loan. The accursed one-eyed son of the manse is considering it…

Saturday, November 22, 2008

Northern Rock Sinking Taxpayers II

As Guido reported Thursday and all the papers followed up yesterday – Northern Rock’s £35 billion Granite Trust is in trouble, buried in the financial jargon is one important note – the percentage of delinquent loans relative to the value of mortgages in the trust rose above pre-set levels. Three different arrears triggers have been breached – remember how Brown and Darling blatantly lied that the taxpayer’s money was secured by the mortgage assets of the bank? Guido repeatedly argued that the only assets of the bank were in its branches. Net-net, the loan book will turn out to be near enough worthless or even negative in value.

The £3 billion of capital injected by the government in August can be kissed goodbye, another £3 billion will be needed soon and that will almost certainly go up in smoke as well. Well done to Vince Cable for giving the government such fulsome support in wasting billions- 28 million taxpayers won’t thank you.

This is an amount enough to give every income-tax payer in the country a £1000 reduction for a year. A targeted fiscal stimulus. What exactly is the taxpayer gaining for subsidising the winding up of Northern Rock?

Friday, November 21, 2008

Friday Caption Competition (Cappuccino edition)

Thursday, November 20, 2008

The Lobby Pass Dilemma

Paul Linford reflects on the perennial Lobby passes for bloggers issue. This has come up again because Ben Brogan (current Lobby chairman) has described the issue as a “a huge headache.”

“They’ve been very reluctant to start issuing passes to new media outlets. There’s an ongoing conversation whether the House of Commons authorities start issuing media passes to bloggers. That remains unresolved.”

 

Not entirely true, new media in the form of Robert Gibson from the Gallery News email service has a pass and the nascent PoliticsHome.com have a pass. Neither have the kind of circulation enjoyed by the leading Westminster blogs. When some time ago 18 Doughty Street (R.I.P.) applied for a pass they were told by the Serjeant-at-Arms that passes were only available to “substantive organisations”, yet they have now given a pass to the smaller PoliticsHome operation run by the same people. Dale and Tim Montgomerie already have (if Guido recalls correctly) Commons passes, presumably Dale could plausibly now get a Lobby pass via Total Politics.

Adam Boulton when he was chairman of the Lobby* told Guido that he thought he should be entitled to a pass and he had no problem with it. Having now gatecrashed quite a few briefings, it really is questionable whether it is that valuable. If you ask a difficult question you don’t get an answer. Ironically half the Daily Lobby spend their time reading blogs and writing comment pieces for their own blogs rather than actually chasing news stories, Guido now feels that going to press conferences can be safely left to the broadcasters – (it would be better for us all if the all the Lobby briefings were broadcast, ask yourself why fearless Lobby journalists are opposed to that happening).

Given the lack of respect Guido has for many members of the Lobby and the tense relationship that some of them have with Guido, it would be something of a headache for Ben if an application was made by this blog. Remember how upset Sir Michael White was when Guido attended a Lobby lunch in an Irish rugby shirt?

There is also a very real danger that by being assimilated into the Lobby one would become part of the system and compromised. Ask yourself why did the decades old issue of MP’s expense fiddles only really come alive in the last few years? The Lobby (with one or two exceptions) didn’t rock the boat on that issue – bloggers and pressure groups led on that issue.

You gain very little edge from invitations to minister’s drinks parties and you don’t get an exclusive by going to an event attended by half the Lobby. Guido has got his best stories directly from sources, not scripted events. The Lobby gets spoon fed by Downing Street and spun from all directions, would the blog be enhanced by having a seat at the back of the plane on a Prime Ministerial trip to Beijing? Would being cosy with Damian McBride be of service to the co-conspirators? Methinks perhaps not.

*Guido called Brogan to ask him his view and he promises to get back shortly.

Kaletsky v Tories

The Cameroons should take heart from Anatole Kaletsky’s condemnation of their approach to economics. Kaletsky’s heyday is long past as Mister-E-Man notes on Nick Robinson’s blog -
The same Anatole Kaletsky who in January of this year, in his Times articleGoodbye to all that: the worst is over for the global credit crunch, predicted that…

…conditions are not nearly as bad as the headlines and market pundits suggest. In Britain, there seems to be almost no chance of economic and financial disasters comparable to those suffered from 1990 to 1992. …I believe that the global credit crisis, far from taking a turn for the worse, is now almost over…. There will be no US recession. …Stock markets around the world will rise in 2008.

Shock horror – Cameron must be devastated not to have this prophetic economic genius on-board…

Anatole Kaletsky is long and very wrong.

Liquidity Issues – Wine Prices Going Down?

During the tech boom in the late nineties Guido was buying wine faster than he could drink it (for once). When the tech collapse halved Guido’s net worth he drank all the wine rather than see it, errm, depreciate. Seemed sensible at the time. This time Guido thinks he should just get short the Wine index (which is exchange traded) and drink the profits.

Unfunded Government Spending Up £1.4 billion in October

Public sector net debt (on the Treasury’s definition) rose to £640.9 billion, or 42.9% of GDP. This does not include other liabilities such as off-balance sheet public sector pension liabilities.

Unfunded government spending is getting worse as the economy nose-dives. it would have been much worse if wasn’t for the receipts from oil companies.

With oil back down to $50 a barrel that won’t be the case in the future…

Unfunded Spending and the End to Prosperity

Danny Finkelstein is fighting a proxy battle for his friend George Osborne, that is why advocates of tax cuts like of Fraser Nelson, Tim Montgomerie, Iain Dale, Dominic Lawson, Nick Clegg and Guido are so willing to battle with him on the blogs and rehearse the arguments.

What is so depressing about Danny’s arguments is that they are primarily about politics rather than economics. They are not even about politics with a capital “P”, but the low politics of electoral calculation.

He has even taken on Arthur Laffer. Danny doesn’t believe there is anything to gain from promising voters tax and spending cuts. Even though strong political leadership could make the case to the voters more credible. It is because of an unwillingness to tackle the issue head-on that the Tories have allowed the vocabulary of the argument to be determined by Brown. How come we never hear much of Gordon’s unfunded spending commitments – the budget deficit? In all of this the actual merits of the case for a low-tax, higher growth economy have been ignored.

Laffer’s new book The End of Prosperity: How Higher Taxes Will Doom the Economy–If We Let It Happen reminds us that there is more to the argument than just psephology. If we want to get out of this recession faster we need to lighten the tax burden on business and consumers…

The Granite Hits the Fan

The FTs Alphaville blog draws our attention to bad news on the wires this morning, as the Dow closes below 8,000 and the FTSE trades below 4,000, we get the news that Granite Master Issue PLC, the trust that is 28% of the UK mortgage securitisation market, is reporting a “non-asset trigger event”. It is telling lenders that Northern Rock‘s collaterallisation, and hence credit worthiness, has declined significantly.Granite is the single biggest funder of the UK mortgage market. If it goes tits up, £38 billion of Northern Rock mortgage assets could be liquidated…

Seen Elsewhere

Apple’s Tim Cook: iGay | Techno Guido
Insurgent Parties Plunge Labour Into Crisis | Alex Wickham
Mind-Bending Politics of Drugs | Mark Wallace
PC Worries Prevent Police Protecting Young Girls | Jill Kirby
Miliband Should Win Rochester | Martin Kettle
Thatcher Minister Sir John Nott ‘Voted for UKIP’ | Times
Time to Listen to Drugs Experts | Guardian
Drug Laws Don’t Work | Times
Our Moral Duty to Cut Taxes | David Cameron
Greens Ahead of LibDems | Guardian
Channel 4 to Spoof UKIP Election Win | Guardian


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David Cameron drug policy reformer and leadership contender in 2005…

“Politicians attempt to appeal to the lowest common denominator by posturing with tough policies and calling for crackdown after crackdown. Drugs policy has been failing for decades.”



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Is it just me, or is Nigel Farage just a top hat and a monocle away from being a Batman villain?


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