Thursday, 31 October 2013

Green taxes

That is a bit of an oxymoron, except where energy is concerned.

The two sides of Britain’s coalition government are lining up for a prolonged argument about how and whether the UK should remain committed to reducing the country’s reliance on sources of energy that produce greenhouse gases.

When they took power, David Cameron and Nick Clegg promised to lead ‘the greenest government ever’. But three years later, their environmental strategy has been blown off course. Why? Because an eye-catching proposal by the opposition Labour leader to freeze household energy bills if elected has focused public attention on what is being called ‘the cost of living crisis’.

The government rejects the energy price freeze idea. But the policy is popular, with more voters naming high energy prices as a threat to the economic recovery than any other potential danger. Over 80% of people also believe the energy companies exploit their customers.

As a result, the prime minister is under pressure from MPs in his own party to cancel the subsidies for investment in renewable energy, some of which push up the cost of ordinary household bills.

Is it disappointing that politicians abandon the high-minded aspiration to make the UK a more environmentally responsible economy when hardship strikes ordinary voters? Or is this a welcome dose of reality: the recognition that ordinary consumers cannot be expected to enjoy – or indeed vote for – policies that push up the cost of living, even if the goal is saving the planet?

Monday, 28 October 2013

Energy crisis

The latest guidance from the government is to only heat one room in your home.

Are they mad?

There is an election in 18 months and they come out with crap like this, the public are not going to forget. This winter is reportedly going to be one of the worst & most expensive on record. This is nearly as good as when the government recommended we should store petrol in cans at home and a woman burned to death in her kitchen.

I do not think we need any more details to show that the government are aliens...

Thursday, 24 October 2013


The home affairs committee has seen several people today from the police and connected services in connection with the incident surrounding Andrew Mitchell.

The good news is that the senior investigating officer [Chief Inspector Jerry Reakes-Williams] has made clear [and been allowed to make clear] the circumstances around the final report after the investigation and how the conclusions were changed. The Chief Inspector followed the mandate laid down by the IPCC and produced a report accordingly, however, his conclusions were over ruled by the three Chief Constables and so the rift began.

The bad news is that the three federation representatives followed and stuck to their story that they didn't believe that Andre Mitchell had told the truth and so made the media announcement at that time. To give Keith Vaz MP and his team credit, they were not so wishy-washy as select committees usually are and were quite firm in their questioning, however, they did not break down the barriers between the politicians and the federation.

The three Chief Constables turned up at different times, which was not explained by the chair.

Chief Constable David Shaw, West Mercia Police announced that he had sent a message to Andrew Mitchell with an apology for what has happened, however, he did not think there should be any more investigations into the matter of how Andrew Mitchell had been handled. He used wording during his answers which appeared to throw doubt on what Chief Inspector Jerry Reakes-Williams has said earlier, specifically that he had followed orders from the IPCC in respect of how the report should be handled although they have now been found to be unlawful. This is bizarre. He also appeared to have an agenda that was not going to be shifted by the committee.

When the three Chiefs eventually got together, rather than showing a consolidated front going forward, they all had different positions to make and it became surreal listening to them explain why they would or would not be taking actions in the future. If they think a simple apology to Andrew Mitchell will allow the public to move on and respect the police again, then they are mistaken.

Wednesday, 23 October 2013

Hackers get a review

Hackers with a criminal past could be recruited to serve in the new military cyber force, the Defence Secretary Philip Hammond indicated. He said the conviction and sentence would be examined but if the candidate got past the vetting process., there would be a place for them in the team

As well as protecting against online attack, the Joint Cyber Reserve Unit will have an offensive capability able to strike at enemies, which is where hackers could come into their own as military assets. There are many professional people out there who will have the skills that you might traditionally associate with the hackers' skill set who have never done anything illegal and who scrupulously maintain their activities on the right side of the law.

The new unit will have “considerable flexibility" in recruiting criteria, without the same standards of fitness required for infantry reservists.

Philip Hammond said: "What we are trying to do is recruit the very brightest and the best from across the IT industry and use the skill sets they have got in the national interest to enhance our cyber defences and to help us build an offensive cyber capability."

It now appears that they are taking this seriously.

Tuesday, 22 October 2013

Tesco give-away

Tesco have admitted they have thrown away 30,000 tons of food in the first six months of the year. Why would they do this?

No, not why do they throw food away, every supermarket does, the accountants hate it as it affects the bottom line, but why have they admitted it?

The company said it would be dropping some food promotions, such as some 'buy one get one free' offers, after it was shown two-thirds of produce grown for bagged salad is thrown out. As a result of the findings, it is to end multi-buys on large bags of salad and is developing mix-and-match promotions for smaller bags in a bid to help customers reduce the amount they are wasting.

Could it be that some bright spark has let on that today’s promotions are too old hat and they need a new format?

Monday, 21 October 2013

Even the church gets involved

The Archbishop of Canterbury has waded into the row over energy prices, warning that the latest wave of hikes looks "inexplicable". Justin Welby insisted the Big Six companies had an obligation to behave morally rather than just maximising profit.

The intervention, came after British Gas followed in the footsteps of SSE by announcing a 9.2% increase in prices. The head of the Church of England, himself a former oil executive, said he understood the anger the rises were generating.

"The impact on people, particularly on low incomes, is going to be really severe in this, and the companies have to justify fully what they are doing. I do understand when people feel that this is inexplicable, and I can understand people being angry about it, because having spent years on a low income as a clergyman I know what it is like when your household budget is blown apart by a significant extra fuel bill and your anxiety levels become very high. That is the reality of it."

The Archbishop urged firms to be "conscious of their social obligations", saying they had to "behave with generosity and not merely to maximise opportunity. They have control because they sell something everyone has to buy. We have no choice about buying it, with that amount of power comes huge responsibility to serve society.”

Friday, 18 October 2013

National Crime Agency

The UK’s biggest and most violent organised crime syndicate, the Provisional IRA, now sits in government and receives taxpayer subsidies through its political front organisation.

Through informally legalised drugs and all the issues they bring in their train, and the state-sponsored surrender to drunkenness begun under Margaret Thatcher and completed under Tony Blair, nothing happens to those who behave badly. There is no redress for their victims, besieged in their homes or fearful on the street, who have learned not to bother to seek help from the law.

The answer to this is not another bunch of poseurs in baseball caps, running around with guns and shouting. It is the firm enforcement of existing laws at street level by unarmed, foot-patrolling constables. But you will never see them again. Instead, the Government is spending almost half a billion pounds on the National Crime Agency, a rather sinister body whose very existence defies our national traditions.

It has been created without any fuss or major opposition. And one day, in the hands of a future government, it could be a real menace.

Thursday, 17 October 2013

Malala Yousafzai

What an amazing teenager.

I do not think there is enough written about the Taliban and what they have done in the past and should be shown to the world not as some body that is old fashioned and out of date but quite simply a criminal organisation that has been allowed to run riot for far too long.

The Taliban blew up 100 schools. Malala's was shut down, and she wrote how she was still studying for her exams in secret. This has come out because of what she has been saying recently but was not reported beforehand and if it has been reported then I missed it and am guilty as the next of ignoring what is happening on the other side of the world.

Which political party would consider blowing up schools the right approach to advancement?

Wednesday, 16 October 2013

Under reporting

There are so many things not reported by the western media, sometimes it is difficult to know where to start.

One thing that seems to have slipped the net is that China has the largest copper mine [outside Africa] in Afghanistan and they have wiped out a 7th century monastery in the process of digging.

Where are the liberals now?

Tuesday, 15 October 2013

Whatever happened to Leveson?

Listening to today's debate, it might as well never happened.

Lord Justice Leveson's report has been published and can be read by anyone, yet both sides [the politicians & the press] both have their interpretation which does not match.

He said quite clearly "An effective regulatory system must be adequately financed and have sufficient independence from its funding body to operate independently." whereas the politicians want a judicial body to oversee whatever replaces the PCC and the press are reeling against both ideas.

So no clarity today!

Monday, 14 October 2013

US shutdown

This is the week that America can go bankrupt, what will be the repercussions around the world?

One often hears that the US shutdown is the result of partisan bickering, that politicians should learn to rise above it and find bipartisan solutions for the good of the nation. Not only the Tea Party, but also Barack Obama is accused of dividing the American people instead of bringing them together. But what if this, precisely, is what is good about Obama? In situations of deep crisis, an authentic division is urgently needed: a division between those who want to drag on within the old parameters and those who are aware of the need for radical change. This, not opportunistic compromise, is the only path to true unity.

Freedom of choice is something that only functions if a complex network of legal, educational, ethical, economic and other conditions exists, the constraints that form the invisible underpinning to the exercise of our freedom. This is why, as an antidote to the populist right wing ideology of choice, countries such as Norway should be held up as a model: although all main agents respect a basic social agreement and large social projects are enacted in solidarity, the economy is thriving, flatly contradicting the common wisdom that such a society should be stagnating.

Back to the question, the world bank has made it clear that there will only be bad news.

Friday, 11 October 2013

America's finance

As the U.S. shutdown continues, what exactly can happen?

On October 17, when the government is projected to reach its debt ceiling, $85 billion of Treasury bills will mature. The interest rate on that T-bill issue last traded at 0.12 percent, up 1 basis point from late on Thursday and up 8 basis points on the week. The benchmark 10-year U.S. Treasury note was down 10/32, its yield at 2.651 percent.

The U.S. shutdown delayed the government's release of non-farm payrolls data for September, which had been scheduled for Friday. The Labour Department's monthly jobs report has been playing a key role in the Federal Reserve's assessment of the economy in its deliberations on when to scale back stimulus.

The problem is paying the bills when the balance sheet says there is no money, I wonder if they have taken advice from Laim Byrne?

Thursday, 10 October 2013


The government has had a reshuffle, nothing to see here except the appointment of Norman Baker to the Home office where I suspect that the first file he is going to ask for is connected with Dr David Kelly. Norman Baker has written a book where he practically accuses the government of the day of assassinating Dr David Kelly.

Norman Baker has said in the past that his computer hard drives were wiped remotely while he was sleuthing around the Kelly story and that Robin Cook’s death was suspicious as it was on MoD land!


Wednesday, 9 October 2013

FT stumped!

The FT has been looking over some recent remarks of the IMF president Christine Lagarde and is baffled.

Christine Lagarde’s remarks show the damage done to emerging markets by a recent round of “taper talk”, over the possibility of the US Federal Reserve slowing the pace of its asset purchases and their vulnerability to future changes in the pattern of global capital flows.

“The immediate priority is to ride out the turbulence as smoothly as possible,” said Ms Lagarde. “Currencies should be allowed to depreciate. Liquidity provision can help deal with dysfunctional market behaviour. Looser monetary policy can also help.”

But she warned that countries with inflationary pressures – such as Brazil, India, Indonesia and Russia – have less scope to use monetary policy and that high debt and deficits mean many developing countries have little space for fiscal stimulus either.

The FT say they have no idea what she is talking about.  Or more precisely, certain paragraphs seem to have one implication [not enough AD in the developing world] and other paragraphs seem to flatly contradict that interpretation [too much inflation.]  Taken literally, she seems to imply that places like Brazil, India, Indonesia and Russia are in better shape than most, but the clear implication of the remarks is exactly the opposite.

Even if you prefer to talk about other topics, say capital flows, how do they impact RGDP/NGDP or AS/AD.

AD = aggregate demand
AS = aggregate supply
GDP = gross domestic product
NGDP = nominal GDP
RGDP = real GDP

Tuesday, 8 October 2013


The next election might be better than we expect.

As the conference season winds down it has become clear that Labour has moved to the left and the conservatives have moved to the right, both leaving the magical centre ground which of course does not actually exist.

As a result of this the next election is shaping up to be a vicious one at which each of the parties will accuse the other of living in the past. Labour will shout: "Same old nasty Tories [and their newspapers]. " Tories will snarl: "Same old dangerous Labour." On current form, it is the Conservatives, answering tomorrow's challenges by dusting off dated narratives, rusty tactics and stale slurs from 20 years ago, who are looking the most retro.

Monday, 7 October 2013

Right to buy

I have mentioned this before

but the government is still going ahead with it, not only that but David Cameron has brought the scheme forward by three months and the banks are not ready apparently.

What I did not mention last time which is the message I am trying to get across is, going back to the bad old days of 2008 and the economic crisis, Basel III has put pressures on banks to keep "more" capital on the balance sheet, hence business moaning about not getting at funding which they need.

Now the government has realised that ‘would be’ home owners are snookered by this action too and so have retracted on the ‘out of fashion’ 90% mortgages and is in fact recommending them. This is quite simply a cynical ploy to get votes for 2015 and cannot possibly help the economy in either the short term or the long term.

Friday, 4 October 2013

Has the world order changed?

Have the events of September 2013 changed the way the world is run?

At the start of the month it seemed pretty certain that America would bomb the Assad regime in Syria as a punishment for using chemical weapons.

Then a number of wholly unexpected things happened. Britain's parliament voted not to join in a bombing campaign; President Obama decided he would have to put the issue to Congress before going ahead; and some clever diplomatic footwork by Russia resulted in an offer by Syria to destroy its chemical warfare arsenal.

The world looked like a distinctly different place by the end of the month. It was not simply that war had been averted, the United States seemed diminished, and its previously reliable ally, Britain, was shown to be irrelevant in an area of the world which it once dominated.

Now America is heading for bankruptcy!

So who is next?

Russia, I think not, their little spat is merely political malarkey.

China, well frankly China seem to be a little quiet as the new regime is trying to woo the west, not ruffle it's feathers.

Brazil, once the talk of the world as the new black but south America has dwindled, so who will be next?

Thursday, 3 October 2013

The depressed economy is all about austerity

Right now the official unemployment rate is over 7 percent. That’s bad, and many people think it understates the true badness of the situation. On the other hand, there are some people arguing that at this point, possibly thanks to long-run damage from the Great Recession, “full employment” is now a number north of 6 percent. So there is considerable uncertainty about just how depressed we are relative to potential.

But we are clearly still well below potential. And we have also had exactly the wrong fiscal policy given that reality plus the zero lower bound on interest rates, with unprecedented austerity. So, how much of our depressed economy can be explained by the bad fiscal policy?

To have something that would arguably look like full employment, at this point we would not need a continuation of actual stimulus, all we would need is for government spending to have grown normally, instead of shrinking.

Let us compare actual government purchases of goods and services since the Great Recession with what would have happened if those purchases had grown as fast as they did starting in the first quarter of 2001.

The gap is large and has been growing rapidly, it is currently more than 2 1/2 percent of GDP. Given reasonable multipliers, this suggests that real GDP is somewhere between 3 and 3.75 percent lower than it would have been without the austerity. And given the usual Okun’s Law rule of half a point of unemployment per point of GDP, this in turn says that without the austerity we would have an unemployment rate well under 6 percent.

I want to make the point that given what we know and have learned about macro these past five years, and given the modest recovery that has taken place, we are now at a point where, to repeat, to a first approximation the depressed state of the economy is entirely due to destructive fiscal policy.

The austerians have a lot to answer for.

Wednesday, 2 October 2013

America bankrupt

The US government does not have money to spend. In fact, if America does not increase its spending limit, all the programmes functioning under the government would have to be closed down. But this has happened before because America has faced a tough situation 17 years ago. Bear in mind that The U.S. has not had a trade surplus in 37 years.

The problem is the government requires a budget to pay for services and that has to be agreed by the senate [parliament].

It is one of those numbers that is so unbelievable you have to actually think about it for a while... Within the next 12 months, the U.S. Treasury will have to refinance $2 trillion in short-term debt. And that's not counting any additional deficit spending, which is estimated to be around $1.5 trillion. Put the two numbers together. Then ask yourself, how in the world can the Treasury borrow $3.5 trillion in only one year? That's an amount equal to nearly 30% of our entire GDP. And we're the world's biggest economy. Where will the money come from?

But it is not about numbers, it is about a group of republicans who are miffed at losing a vote earlier on America's health bill and they are having a tantrum, surely the American people can see their politicians for what they are and will respond accordingly at the next election.

Tuesday, 1 October 2013

Chancellor of the exchequer

First he starts on the current situation and why we are here, then he mentions the other party conferences with the usual splash of humour at the Lib Dems & Labour expense. His main aim is to show that "our" priority is the economy so there must be a credible plan and whereas the other two do not have one, the conservatives do.

He then goes on to flesh out the details, frankly I am impressed, but will they pull it off?