Kwarteng says highest rate of income tax being abolished, and basic rate being cut to 19% from next April

You guys are phucked...i'll stay here in gang war torn sweden.:wave:

Quote:

---

Originally Posted by JamesWales

I agree. It seems to have been a curious thing to do at this juncture and a step too far. I calculated roughly that from Premier League players alone, the chancellor will take £30m less in 2023/24 than this year.

That said, I don't think I'd call it immoral. The idea is that it leads to greater investment and growth etc. It is a gamble though, and as I wrote above, I don't support that element of it.

---

All a load of bollocks. And pretty much everyone knows it. The only thing they’ll invest in (if they don’t just hoard the wealth) will be properties. Less houses on the market means higher house prices and higher rent for us plebs. Landlords are just a richer version of the pricks that scalp tickets.

Quote:

---

Originally Posted by Canton Kev

All a load of bollocks. And pretty much everyone knows it. The only thing they’ll invest in (if they don’t just hoard the wealth) will be properties. Less houses on the market means higher house prices and higher rent for us plebs. Landlords are just a richer version of the pricks that scalp tickets.

---

I feel sorry for anyone who has a mortgage. He's just bent them over big-time. Lending rates about to sky-rocket.
Usual Tory shit, rape and pillage the poor while hoarding all the wealth. Keep the paupers in their place.

Quote:

---

Originally Posted by az city

There is currently rampant inflation in the UK caused by a plethora of aggregate supply shocks (some local, some global). It's not being caused by excess aggregate demand.

The BoE is doing what it's mandated to do with its one tool, interest rates (monetary policy), to try to control inflation. So, in the lingo, the UK is operating tight monetary policy and raising interest rates. Raising interest rates is designed to dampen consumer demand and investment effectively reducing aggregate demand.

It would be crazy in this circumstance to simultaneously operate a loose fiscal policy (tax cuts). You're stoking aggregate demand financed by government borrowing at a time when you're supposedly trying to control inflation.

So two things are likely to occur - more inflation and higher interest rates.

The "markets" have clearly decided that is not a good recipe. The UK is turning itself into a basket case. It will be interesting to see if the GBP hits parity with the Euro or the USD first.

It's macroeconomic policy from a madhouse.

---

I’d have to agree. I was half thinking (well, hoping) Truss was being strategic in her messaging during the leadership election, given the make up of the “electorate”, to then become a bit more pragmatic in the short term once in office given the realities of governing in the current economic moment and a general election which isn’t that far away. Essentially, using her leadership bid to roll the pitch for a programme to run on at the next general election once inflation may have been tamed.

I’ve been surprised at the silence since last week’s fiscal event. The lack of reassurance through messaging and explanation isn’t helping with market volatility and does make me question if this has come as a greater surprise to the government than anticipated, although it shouldn’t have.

Quote:

---

Originally Posted by the other bob wilson

So, tell me, how do you think the UK economy has performed over the past twelve years?

---

between 2002-2007 the economy grew by 2.9% year on year. It nosedived in 2007-8 eradicating most of the gains

between 2010-2015 the economy grew at 2% and grew again by more than 2% in the years 2016-2022, except for 2020 when it nosedived, eradicating a lot of the gains in the previous years.

The economy is larger now than it was in 2002, 2010 and 2015.

Quote:

---

Originally Posted by az city

The GBP is now at 1.09 v the $. It seems the financial community doesn't think it's as "brilliant" as you, genius.

---

Its weird how the left are now using the financial markets in support of their position, whereas at all other times the financial markets are derided by the left.

Quote:

---

Originally Posted by Tuerto

This makes no sense whatsoever. Just to add, there isn't any Left Wing Media in the UK, The Guardian, a newspaper that did all it could to discredit Corbyn, is centrist.

---

the Guardian is centre left.

Quote:

---

Originally Posted by Claude Blue

There is, of course, one simple way to ensure growth - rejoin the CU, SM and eventually the EU.

But you know that James, you're just not yet ready to admit your voting mistake in 2016.

---

:thumbup:

Quote:

---

Originally Posted by DryCleaning

between 2002-2007 the economy grew by 2.9% year on year. It nosedived in 2007-8 eradicating most of the gains

between 2010-2015 the economy grew at 2% and grew again by more than 2% in the years 2016-2022, except for 2020 when it nosedived, eradicating a lot of the gains in the previous years.

The economy is larger now than it was in 2002, 2010 and 2015.

---

Not true according to this, there’s a reason why it “nosedived” in 07/08, and moreso in 08/09, - and why it did in 19/20 followed by a rise we wouldn’t have seen in normal circumstances that Johnson was always crowing about.

https://www.macrotrends.net/countrie...dp-growth-rate

Quote:

---

Originally Posted by the other bob wilson

Not true according to this, there’s a reason why it “nosedived” in 07/08, and moreso in 08/09, - and why it did in 19/20 followed by a rise we wouldn’t have seen in normal circumstances that Johnson was always crowing about.

https://www.macrotrends.net/countrie...dp-growth-rate

---

the UK economy was $1.78trn in 2002, in 2010 it was $2.482trn, and in 2015 it was $2.933trn. In 2020 it was $2.748trn with a rise of around 7.5% to $2.953trn in 2021.

We know the reason it nosedived in 2007/8/9, like we know the reason it nosedived in 2020. I'm not making comment on either, I'm just stating what happened. I doubt it very much that different governments would have made any difference in either event.

Quote:

---

Originally Posted by DryCleaning

the Guardian is centre left.

---

It's a Liberal paper . It was founded as a Liberal supporting paper in Manchester . In the brown v Cameron head to head it sided with clegg . Then slagged off the liberals for not getting enough votes to form a coalition with Labour.

I have never forgiven the tossers .

Quote:

---

Originally Posted by Kind of Blue

I’d have to agree. I was half thinking (well, hoping) Truss was being strategic in her messaging during the leadership election, given the make up of the “electorate”, to then become a bit more pragmatic in the short term once in office given the realities of governing in the current economic moment and a general election which isn’t that far away. Essentially, using her leadership bid to roll the pitch for a programme to run on at the next general election once inflation may have been tamed.

I’ve been surprised at the silence since last week’s fiscal event. The lack of reassurance through messaging and explanation isn’t helping with market volatility and does make me question if this has come as a greater surprise to the government than anticipated, although it shouldn’t have.

---

There's a rumour circulating that the BoE's hurried intervention is to prevent a complete meltdown of the UK financial system.

I am beginning to think they (Truss and Sunak) actually believed what Minford told them in coming up with this idiocy. (For reference, Minford is an 80 year old, rather confused, academic (Cardiff University) who was behind a lot of Thatcherism and Brexit and has reputation for being very wrong most of the time.)

Quote:

---

Originally Posted by Canton Kev

All a load of bollocks. And pretty much everyone knows it. The only thing they’ll invest in (if they don’t just hoard the wealth) will be properties. Less houses on the market means higher house prices and higher rent for us plebs. Landlords are just a richer version of the pricks that scalp tickets.

---

https://academic.oup.com/ser/article/20/2/539/6500315

Quote:

---

Originally Posted by DryCleaning

between 2002-2007 the economy grew by 2.9% year on year. It nosedived in 2007-8 eradicating most of the gains

between 2010-2015 the economy grew at 2% and grew again by more than 2% in the years 2016-2022, except for 2020 when it nosedived, eradicating a lot of the gains in the previous years.

The economy is larger now than it was in 2002, 2010 and 2015.

---

Point of order here - if growth rates fall it doesn't necessarily mean the economy is smaller in absolute terms.

Quote:

---

Originally Posted by az city

There's a rumour circulating that the BoE's hurried intervention is to prevent a complete meltdown of the UK financial system.

I am beginning to think they (Truss and Sunak) actually believed what Minford told them in coming up with this idiocy. (For reference, Minford is an 80 year old, rather confused, academic (Cardiff University) who was behind a lot of Thatcherism and Brexit and has reputation for being very wrong most of the time.)

---

100% correct!

By the way, it.looks like right wing fantasy and lunacy is showing no signs of abating any time soon.

I just read that "respected" Brexit worshipping guru Daniel Hannan has reportedly suggested that the damaging market turmoil of the past few days has absolutely nothing to do with the Truss/Kwarteng mini budget. He says it's all to do with market reaction to and fear of the increased likelihood of an incoming Labour government! 😲

Well he was spot on about the wonderful benefits Brexit would bring us so does he know something even leading economists don't and perhaps he's bang on the money again?

Quote:

---

Originally Posted by az city

Point of order here - if growth rates fall it doesn't necessarily mean the economy is smaller in absolute terms.

---

I don't think anyone has suggested it has.

Quote:

---

Originally Posted by az city

There's a rumour circulating that the BoE's hurried intervention is to prevent a complete meltdown of the UK financial system.

I am beginning to think they (Truss and Sunak) actually believed what Minford told them in coming up with this idiocy. (For reference, Minford is an 80 year old, rather confused, academic (Cardiff University) who was behind a lot of Thatcherism and Brexit and has reputation for being very wrong most of the time.)

---

Perhaps you forget the QE from ten years ago, this buy back of gilts was always going to happen, it just so happens to be happening now. Poor political timing, of course. But pretty much planned. And it makes the lesser educated feel as if the Tories are to blame, which isn't a bad thing.

The BoE is planning that the gilt buyback will reduce inflation as liquidity is removed from the system. I doubt the markets will be affected as this buy back will have already been factored into long bond pricing.

Quote:

---

Originally Posted by DryCleaning

Perhaps you forget the QE from ten years ago, this buy back of gilts was always going to happen, it just so happens to be happening now. Poor political timing, of course. But pretty much planned. And it makes the lesser educated feel as if the Tories are to blame, which isn't a bad thing.

The BoE is planning that the gilt buyback will reduce inflation as liquidity is removed from the system. I doubt the markets will be affected as this buy back will have already been factored into long bond pricing.

---

Sorry? You're claiming the panicky buyback of gilts today was planned years ago? What have you been smoking?

Quote:

---

Originally Posted by DryCleaning

I don't think anyone has suggested it has.

---

Actually it was you who suggested the economy had "nosedived" earlier today. Maybe you were being imprecise?

The Bank of England was forced to take emergency action today in a desperate attempt to stabilise the UK economy to stop mass insolvencies of pension funds today, it has been claimed. Earlier today, the BoE announced it would be carrying out "temporary purchases of long-dated UK government bonds" after Kamikaze Kwarteng's mini-budget announcement last week sent the value of the pound plummeting.
remortgage rates at 4/5 %.

Quote:

---

Originally Posted by Dorcus

100% correct!

By the way, it.looks like right wing fantasy and lunacy is showing no signs of abating any time soon.

I just read that "respected" Brexit worshipping guru Daniel Hannan has reportedly suggested that the damaging market turmoil of the past few days has absolutely nothing to do with the Truss/Kwarteng mini budget. He says it's all to do with market reaction to and fear of the increased likelihood of an incoming Labour government! ��

Well he was spot on about the wonderful benefits Brexit would bring us so does he know something even leading economists don't and perhaps he's bang on the money again?

---

The idea that the markets react today to mere possibilities, that might be two years away, is utterly preposterous.

Quote:

---

Originally Posted by DryCleaning

Perhaps you forget the QE from ten years ago, this buy back of gilts was always going to happen, it just so happens to be happening now. Poor political timing, of course. But pretty much planned. And it makes the lesser educated feel as if the Tories are to blame, which isn't a bad thing.

The BoE is planning that the gilt buyback will reduce inflation as liquidity is removed from the system. I doubt the markets will be affected as this buy back will have already been factored into long bond pricing.

---

As a “lesser educated” type I must confess to thinking this fiasco was down to years of Conservative economic mismanagement, the Brexit disaster stripping every inch of resilience from the economy, the Tufton Street mob and their hidden backers and Tory press holding undue influence over UK political policy, Crispin Odey and his hedge fund pals gloating as they short the pound and bet on the bond markets and f*ck the pensions of millions of ordinary workers etc etc. But no I was wrong and instead must blame an unfortunate co-incidence - that this crisis is ENTIRELY due to a buy back of gilts dating from quantitative easing 10 years ago which just happens to coincide TO THE DAY with what pretty well every respected economist and many, many Tory MPs consider to have been a weapons-grade disaster Trussonomics budget from the Chancellor Kwasi Kwarteng. Who knew?!

I see Truss has mysteriously vanished.

Quote:

---

Originally Posted by az city

Sorry? You're claiming the panicky buyback of gilts today was planned years ago? What have you been smoking?

---

Thats not what I said.

Read it again, the BoE was always planning to buy back the gilts it issued 10 years ago, that's how gilts work.

The buy back has been brought forward. Go and read about QE.

Quote:

---

Originally Posted by az city

Actually it was you who suggested the economy had "nosedived" earlier today. Maybe you were being imprecise?

---

I said the economy nosedived in 2007/8 and 2020. I also made it clear that, imho, neither event was due to the government of the day.

I'm not sure if you really have a total lack of comprehenduon or you're just being obtuse.

Quote:

---

Originally Posted by Delbert

As a “lesser educated” type I must confess to thinking this fiasco was down to years of Conservative economic mismanagement, the Brexit disaster stripping every inch of resilience from the economy, the Tufton Street mob and their hidden backers and Tory press holding undue influence over UK political policy, Crispin Odey and his hedge fund pals gloating as they short the pound and bet on the bond markets and f*ck the pensions of millions of ordinary workers etc etc. But no I was wrong and instead must blame an unfortunate co-incidence - that this crisis is ENTIRELY due to a buy back of gilts dating from quantitative easing 10 years ago which just happens to coincide TO THE DAY with what pretty well every respected economist and many, many Tory MPs consider to have been a weapons-grade disaster Trussonomics budget from the Chancellor Kwasi Kwarteng. Who knew?!

---

You're taking what I said out of context. The gilt buyback was always going to happen. The fact its happening now is, to a certain degree, coincidental.

It doesn't detract from the rest of the points you make, which by and large I agree with.

My comment is that the gilts were going to be bought by the BoE at some point. That's how QE works.

Quote:

---

Originally Posted by DryCleaning

I said the economy nosedived in 2007/8 and 2020. I also made it clear that, imho, neither event was due to the government of the day.

I'm not sure if you really have a total lack of comprehenduon or you're just being obtuse.

---

Actually, you seem incapable of expressing yourself clearly.

What exactly is "comprehenduon"? If you have it, I don't want anything to do with it, thank you.:hehe:

Quote:

---

Originally Posted by DryCleaning

Thats not what I said.

Read it again, the BoE was always planning to buy back the gilts it issued 10 years ago, that's how gilts work.

The buy back has been brought forward. Go and read about QE.

---

Old chum, the BoE doesn't "buy back" maturing bonds, it pays back the principal and the final coupon upon maturity. And actually in may cases the BoE just issues more to replace those that are maturing. It effectively rolls over its debt obligations.

Anyway, today's bond market intervention had absolutely nothing to do with maturing bonds.

Tell us where you get your government bond market "expertise" from.

To all you “Council House Tory’s”, this is what they really think about you https://twitter.com/the_tuc/status/1...4ctcobsN9UjZJQ

Quote:

---

Originally Posted by DryCleaning

You're taking what I said out of context. The gilt buyback was always going to happen. The fact its happening now is, to a certain degree, coincidental.

It doesn't detract from the rest of the points you make, which by and large I agree with.

My comment is that the gilts were going to be bought by the BoE at some point. That's how QE works.

---

Well I’ve watched several leading economists today and unsurprisingly none of them think this disaster has been caused by a gilt buy back stemming from quantitative easing 10 years ago. Instead all of them think it’s been precipitated by the reckless incompetence of the PM and her Chancellor over the last few days.

Professor Jonathan Portes said the market reaction was due to “the moron risk premium where all are agreed they are so incompetent you simply don’t know what they’re going to do next”.

Danny Blanchflower said “I have never seen such raging incompetence ever”.

Yanis Varoufakis said “It’s a rookie mistake I have to confess”.

When will the vote of no confidence go in.?

Truss to be the shortest PM in history.,?

Bring on the next idiot.

Quote:

---

Originally Posted by az city

Actually, you seem incapable of expressing yourself clearly.

What exactly is "comprehenduon"? If you have it, I don't want anything to do with it, thank you.:hehe:

---

It's a typo, deal with it.

Quote:

---

Originally Posted by az city

Old chum, the BoE doesn't "buy back" maturing bonds, it pays back the principal and the final coupon upon maturity. And actually in may cases the BoE just issues more to replace those that are maturing. It effectively rolls over its debt obligations.

Anyway, today's bond market intervention had absolutely nothing to do with maturing bonds.

Tell us where you get your government bond market "expertise" from.

---

I used to trade gilts, I was there in the first round of QE.

Stick to reading your course books

:bigthumbup:

Quote:

---

Originally Posted by Delbert

Well I’ve watched several leading economists today and unsurprisingly none of them think this disaster has been caused by a gilt buy back stemming from quantitative easing 10 years ago. Instead all of them think it’s been precipitated by the reckless incompetence of the PM and her Chancellor over the last few days.

Professor Jonathan Portes said the market reaction was due to “the moron risk premium where all are agreed they are so incompetent you simply don’t know what they’re going to do next”.

Danny Blanchflower said “I have never seen such raging incompetence ever”.

Yanis Varoufakis said “It’s a rookie mistake I have to confess”.

---

The markets are spooked by the lack of forecast from the OBR and the contradiction in policy to what BoE are trying to achieve.

Quote:

---

Originally Posted by DryCleaning

The markets are spooked by the lack of forecast from the OBR and the contradiction in policy to what BoE are trying to achieve.

---

You silly tory clown 🤡

Quote:

---

Originally Posted by SLUDGE FACTORY

You silly tory clown 🤡

---

I want this government gone as much as you. Tory. Don't be silly.

Quote:

---

Originally Posted by DryCleaning

I want this government gone as much as you. Tory. Don't be silly.

---

You are doing a very good job of defending liz truss

Right wing Plaid Cymru

Quote:

---

Originally Posted by SLUDGE FACTORY

You are doing a very good job of defending liz truss

Right wing Plaid Cymru

---

I've not defended anyone. I think Truss is reactionary and populist, and we're going to be worse off than better.

Quote:

---

Originally Posted by DryCleaning

I've not defended anyone. I think Truss is reactionary and populist, and we're going to be worse off than better.

---

Sensible comment 👍

Quote:

---

Originally Posted by DryCleaning

I used to trade gilts, I was there in the first round of QE.

Stick to reading your course books

:bigthumbup:

---

What? In 1694?