Monday, June 28, 2010

Those Massive Spending Cuts in Full

Listening to the BBC or reading left-wing newspapers and blogs would lead you to think we were about to suffer shock-doctrine economics at the hands of the Coalition requiring martial law to enforce.  The fact is that at the end of this parliament government spending will be up another 9%.

The public sector is merely looking at below inflation spending increases, but increases nevertheless. There are not going to be across the board spending cuts, there is going to be a re-prioritisation of resources, with slower overall spending growth. George Osborne is no Pinochet…

Incidentally it could be worse, in Obama’s United Soviets of America the White House is planning (Brown-style) to maintain 10% deficit financing next year. Within a generation the White House itself is predicting a 25% deficit. Which means Greek style bankruptcy…

Friday, April 23, 2010

Friday Caption Competition (Fool and Fuld Edition)

Sunday, April 18, 2010

Brown Attacks “Moral Bankruptcy” of Goldman Sachs

On the Marr show Gordon raged against the moral bankruptcy of Goldman Sachs; “I want a special investigation done into what has happened at Goldman Sachs.”

Perhaps he could ask Gavyn Davies to investigate? For many years he has been advised by Gavyn Davies, who made some £150 million during his period as a Goldman Sachs partner.

It was Davies who last year urged Gordon to implement Mugabenomics, turn on the printing presses and call it quantitative easing. Davies has been a big donor to the Labour Party and a long-term supporter. Davies’ wife Sue Nye was Gordon’s private secretary in Downing Street and they are known to be good friends. Perhaps it was they who stole Gordon’s moral compass.

UPDATE : The more Guido thinks about this, the more he likes Gordon’s idea. Questions Guido would like the Goldman Sachs special investigator to get answered:

  • Exactly how many boardroom lunches and suchlike did Gordon Brown have with Goldman Sachs figures?
  • During the many lunches Gordon had with Goldman Sachs did he discuss policy or matters which they were able to exploit to their advantage in the markets?
  • Goldmans were known to be major sellers of gold before Brown announced his extraordinarily ill-conceived plan to sell the Bank of England’s gold reserves.
  • Gavyn Davies was an adviser to Gordon Brown during this period.  Did he recommend, advise on or know anything of the intended gold sales policy?  Did Sue Nye know of the intention to sell gold?


These are not matters of little import, Gordon’s gold sales debacle cost the Treasury £6 billion, the amount that Gordon claims will devastate the economy if the Tories cut it from public spending. The bank is known at rival firms as ‘Government Sachs’ because senior partners keep so close to governments and in particular finance ministries…

Thursday, February 18, 2010

Double Dip Anyone?

Following the longest recession in history Britain posted its first-ever budget deficit for the month of January.  Usually January is a bumper month for tax receipts.  Unfunded government over-spending was £4.3 billion, when consensus economists were forecasting a £2.6 billion surplus, according to the median of 16 forecasts in a Bloomberg News survey.

Don’t rule out a double-dip recession.  With neither the Conservatives or Labour offering policies to kick-start consumer spending and GDP growth, we could be in a lot of trouble…

Tuesday, February 16, 2010

3.5% Inflation Shatters Deflation Illusion

So have you stocked up on beans or gold yet?  Have you taken Guido’s advice?

The Governor of the Bank of England now has to write an open letter to the Chancellor. This is Mervyn King’s sixth such letter in seven years.  Perhaps he will recommend stocking up on commodities.  Don’t forget we have a serious chance of a double-dip recession on the horizon.  And still we have no pro-growth policies from the government, only over-spending and over-borrowing…

Tuesday, February 2, 2010

Through the Looking Glass Economics

The news agenda yesterday oscillated between Phil Hammond saying that the Tories had only identified £1.5 billion of cuts and Labour seizing on Cameron’s shift of emphasis saying that there would be no swingeing spending cuts, just a start on cuts in 2010.  Mandelson claimed that the Tories would pull the rug out from under the recovery by cutting £11 billion this year when he himself said only last month that we need to cut £80 billion-a-year within 4 years.  The government is even legislating to that effect.  It is like the Mad Hatter’s Tea Party:

`Have some wine,’ the March Hare said in an encouraging tone.  Alice looked all round the table, but there was nothing on it but tea. `I don’t see any wine,’ she remarked. `There isn’t any,’ said the March Hare.  `Then it wasn’t very civil of you to offer it,’ said Alice angrily.

Meanwhile, back in fiscal reality, Britain is the most indebted nation in the industrialised world.  McKinsey released research yesterday which puts the “billion here, a billion there” political squabbling in perspective.


Have the politicians grasped the magnitude of the deep hole Britain is in? The Tories have publicly identified spending cuts equivalent to less than ¼ of a percent of GDP.  The government is overspending by some hundred times that amount.  This is “through the looking glass” economics.

Alice laughed. “There’s no use trying,” she said: “one can’t believe impossible things.” “I daresay you haven’t had much practice,” said the Queen. “When I was your age, I always did it for half-an-hour a day. Why, sometimes I’ve believed as many as six impossible things before breakfast.”

We can’t go on like this…

Wednesday, January 27, 2010

Dead Cat Bouncing into Double Dip?

Yesterday’s GDP disappointment makes the case for a tax cutting Emergency Growth Budget even stronger.  Policy Makers have got to go for growth, you can’t tax your way to prosperity.  Or else the cat gets it…

Graphic : Taxloss via Alphaville

Tuesday, January 26, 2010

GMTV (Guido Morning TV) : Who Got It Wrong?

+++ UK Preliminary 4Q GDP Anaemic +0.1%, -3.2% On Year +++

A rounding error rather than an end to recession…

UPDATE : Reflect that we have had £200 billion of quantitative easing and all we get is this – most of that went on giving foreign gilt investors an exit rather than bank loans to enterprises.  Subtract the mirage of the Keynesian car scrappage scheme from the figures and we are really still in recession.

Tuesday, December 1, 2009

Two Left Feet : What is Will Straw Smoking?

It didn’t take long for Will “we don’t do attack dog” Straw of Left Foot Forward to, errm, go on the attack.  The editor of the well funded “evidence based” blog dismissed Guido’s story (“Economics for 7 Year Olds“) about the UK being the only G20 country left in recession by quoting the figures from the back pages of an out of date copy of the Economist.

He even made a little dunce’s hat and wittily headlined his piece “Economics for Gui-d’oh  Fawkes”.

Will might have checked a back-copy of the Economist, but it seems he missed the news yesterday that Canada grew 0.1% in Q3, Mexico grew 2.93% in Q3, South Africa grew 0.9% annualised in Q3, and so did Russia. The story was driven by the new data released.  Guido isn’t sure what Will is smoking, but the icing on the cake was the citing of Spain as an example of a G20 country still in recession.  Spain isn’t even in the G20 Will.

Will’s blog is usually pretty good, provocative and produces original content, he really should stick to evidence based positive stuff, the last mysteriously funded high profile left-wing blogger who tried to take Guido on head-to-head made a huge fool of himself.  Will should also know (from his years of spinning for HM Treasury) that you need evidence that is up-to-date. Guido’s story was based on news, not old data or wishful thinking…


Seen Elsewhere

What Farage, Boris and Rob Ford Have in Common | William Walter
Labour Spell New Adviser’s Name Wrong | ITV
Dave Stung by Jellyfish | Sun
City Minister’s Inheritance Tax Dodging Trusts | Indy
What I Would Have Done if I was Sarah Wollaston | Iain Dale
Boris is an Epic Europhile | Louise Mensch
Warsi Got PM to Confront “Secular Fundamentalism” | Fraser Nelson
Guardian April Fools Apology | Press Gazette
Jenni Russell and Her Child’s Godfather, Ed Miliband | Breitbart
Labour’s Left and Right are Growing Restive | Staggers
Corrupt, Incompetent UN Has No Right to Lecture Us | Dan Hannan


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Rod Liddle on the loony UN sexism special rapporteur:

“There is more sexism in Britain than in any other country in the world, according to a mad woman who has been sent here by the United Nations.

Rashida Manjoo is a part-time professor of law at Cape Town University in the totally non-sexist country of South Africa (otherwise known as Rape Capital Of The World).

Mrs Magoo has been wandering around with her notebook and is appalled by the sexist “boys’ club” culture here, apparently.

I don’t doubt we still have sexism in the UK. But is it worse than in, say, Saudi Arabia, d’you think, honey-lamb? Or about 175 other countries? Get a grip, you doolally old bat.”



orkneylad says:

What’s he been doing FFS, mining bitcoins?


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