Oncoming obtenebration II...

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The news in the UK that inflation rates stayed at zero [££Times and/or handy Economist graph HERE on what's what] (missing deflation but headed there anyway?) currently paints a rosy picture for the UK consumer, will the phrase "The economy, stupid" hold true for the coming UK General Election in May?



Across the water however, some very worrying figures emerged:

"...in a world in which the only economic growth comes as a result of new credit entering the economy (as opposed to Fed reserves being stuck in the S&P), the only thing that matters is how easy it is to get credit into the hands of those who need it. As it turns out it has never been more difficult to get credit... "And without any new credit entering the economy, a recession is all but assured."

Time will tell...

Oncoming obtenebration II...

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The news in the UK that inflation rates stayed at zero [££Times and/or handy Economist graph HERE on what's what] (missing deflation but headed there anyway?) currently paints a rosy picture for the UK consumer, will the phrase "The economy, stupid" hold true for the coming UK General Election in May?

Across the water however, some very worrying figures emerged:

"...in a world in which the only economic growth comes as a result of new credit entering the economy (as opposed to Fed reserves being stuck in the S&P), the only thing that matters is how easy it is to get credit into the hands of those who need it. As it turns out it has never been more difficult to get credit... "And without any new credit entering the economy, a recession is all but assured."

Time will tell...

Obit overshadows Osborne's optimistic outlook...

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No disrespect to Mandela but enough is being said elsewhere... everywhere, so I'll keep schtum [edit: 9pm] although if you have had enough of the fawning pap being spewed out in most media please read this from Charles Crawford. Yesterday had other news: the UK Chancellor George Osborne gave his Autumn Statement (Link: PDF) to Parliament on the state of the UK economy and the Coalition government's future plans. At a glance things are looking good despite BBC Peston's ludicrously negative report (and coordinated comments); he was presumably one of those BBC journalists prepared in advance (Link: PDF) by the assumed lefty (pinch of salt) IFS; (no doubt more from them on the BBC later ([edit]...later: haha, told you). The Taxpayers' Alliance briefing is broadly supportive (Link:PDF) but think Osborne 'must do more'; a key is the continued cutting the number and complexity of taxes: they say Tolley’s Tax Guide is now over 17,000 pages long. Particularly interesting is the TPA tax tracker: "Since the Coalition Government came to power in 2010, 509 tax hikes and 209 tax cuts have been announced". Two articles that IMHO are worth reading: Kamal Ahmed in the DT ("Be grateful that George Osborne did not unveil a Brownite master plan") and I also liked Rafael Behr's article in the NS: "...the macroeconomic indicators fuelling Conservative levity conceal real pain that will cost the government votes".

Obit overshadows Osborne's optimistic outlook...

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No disrespect to Mandela but enough is being said elsewhere... everywhere, so I'll keep schtum [edit: 9pm] although if you have had enough of the fawning pap being spewed out in most media please read this from Charles Crawford. Yesterday had other news: the UK Chancellor George Osborne gave his Autumn Statement (Link: PDF) to Parliament on the state of the UK economy and the Coalition government's future plans. At a glance things are looking good despite BBC Peston's ludicrously negative report (and coordinated comments); he was presumably one of those BBC journalists prepared in advance (Link: PDF) by the assumed lefty (pinch of salt) IFS; (no doubt more from them on the BBC later ([edit]...later: haha, told you). The Taxpayers' Alliance briefing is broadly supportive (Link:PDF) but think Osborne 'must do more'; a key is the continued cutting the number and complexity of taxes: they say Tolley’s Tax Guide is now over 17,000 pages long. Particularly interesting is the TPA tax tracker: "Since the Coalition Government came to power in 2010, 509 tax hikes and 209 tax cuts have been announced". Two articles that IMHO are worth reading: Kamal Ahmed in the DT ("Be grateful that George Osborne did not unveil a Brownite master plan") and I also liked Rafael Behr's article in the NS: "...the macroeconomic indicators fuelling Conservative levity conceal real pain that will cost the government votes".

Overly optimistic IV...

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Peter Spence at City A.M. replies to Will Hutton's overly optimistic alternative history Guardian article. Both are good and although we all can laugh at the latter, what he writes, albeit hypothetical, may have changed everything and saved us from the 'Credit Crunch'; I doubt it though because the straws loading the camel's back began in earnest in the late nineties. Anyhoo, what I hadn't seen before - and what is very very interesting - was the image left (click to enlarge, it's worth it) that accompanies the City A.M. piece, which shows a number of hypothetical monetary unions and how well their economies could be joined in a union: some are logically good fits but such random groups as economies of countries beginning with the letter "M" and all countries on earth along the latitude line 5th parallel north had more in common than the first 12 members of the euro! What set out to unite will ultimately divide, QED. 

Overly optimistic IV...

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Peter Spence at City A.M. replies to Will Hutton's overly optimistic alternative history Guardian article. Both are good and although we all can laugh at the latter, what he writes, albeit hypothetical, may have changed everything and saved us from the 'Credit Crunch'; I doubt it though because the straws loading the camel's back began in earnest in the late nineties. Anyhoo, what I hadn't seen before - and what is very very interesting - was the image left (click to enlarge, it's worth it) that accompanies the City A.M. piece, which shows a number of hypothetical monetary unions and how well their economies could be joined in a union: some are logically good fits but such random groups as economies of countries beginning with the letter "M" and all countries on earth along the latitude line 5th parallel north had more in common than the first 12 members of the euro! What set out to unite will ultimately divide, QED. 

Old Ows opinion...

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Many City economists were surprised to see that Government borrowing is down; don't worry, I'm not going to praise GO or say it's all as planned but I did like the info HERE at Guardian data blog. What irritated me was that in the image (click to enlarge) they had squeezed the picture of Brown far to the left making him appear over only those 'good' years of surplus (which was when, as we all know, he followed Conservative spending plans) and have the picture of Darling spread over most of the Crash Gordon years and we ALL now know, and it isn't hard to see, that Britain's debt soared from 2000 and Brown was to blame. It is petty things like the positioning of the Chancellors' pictures that annoy me (yes, yes, OK, I'm small minded and petty when it comes to Gordon Brown). Anyway, taking time before another day 'at the office' here in Guadalajara, I popped in to comment and decided to read what was being said...and there I got a surprise to see I had already commented several times on the first page (highly recommended too); no, not hacked, just comments on the original article back in May 2010. It is still interesting to read and of course I write that to clear-up Labour's mess will take a few years.

Old Ows opinion...

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Many City economists were surprised to see that Government borrowing is down; don't worry, I'm not going to praise GO or say it's all as planned but I did like the info HERE at Guardian data blog. What irritated me was that in the image (click to enlarge) they had squeezed the picture of Brown far to the left making him appear over only those 'good' years of surplus (which was when, as we all know, he followed Conservative spending plans) and have the picture of Darling spread over most of the Crash Gordon years and we ALL now know, and it isn't hard to see, that Britain's debt soared from 2000 and Brown was to blame. It is petty things like the positioning of the Chancellors' pictures that annoy me (yes, yes, OK, I'm small minded and petty when it comes to Gordon Brown). Anyway, taking time before another day 'at the office' here in Guadalajara, I popped in to comment and decided to read what was being said...and there I got a surprise to see I had already commented several times on the first page (highly recommended too); no, not hacked, just comments on the original article back in May 2010. It is still interesting to read and of course I write that to clear-up Labour's mess will take a few years.

Optimistic observations...

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1. Unemployment has fallen for the 5th successive month. 


2. Industrial output rose by 2.9% in June - fastest rise for 25 years. 


3. Manufacturing output rose by 3.3% in June - fastest rise for 10 years. 


4. Business start-ups in 2011 were the highest for decades: 471,466 new private sector businesses started last year. 


5. UK Exports reached £39.2 billion in June (close to all-time record levels; the record level being set in November 2011) Key markets: China up 74% in the past year; India up 94%; Russia up over 100%. There's more, ten in fact, from Lord Bates [Conservative Home] who also reminds us that "Sir John Major gave an excellent interview on the Andrew Marr programme yesterday" [Link]. Now, all the points have a flip-side but things do seem to be improving.

Optimistic observations...

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1. Unemployment has fallen for the 5th successive month. 
2. Industrial output rose by 2.9% in June - fastest rise for 25 years. 
3. Manufacturing output rose by 3.3% in June - fastest rise for 10 years. 
4. Business start-ups in 2011 were the highest for decades: 471,466 new private sector businesses started last year. 
5. UK Exports reached £39.2 billion in June (close to all-time record levels; the record level being set in November 2011) Key markets: China up 74% in the past year; India up 94%; Russia up over 100%. There's more, ten in fact, from Lord Bates [Conservative Home] who also reminds us that "Sir John Major gave an excellent interview on the Andrew Marr programme yesterday" [Link]. Now, all the points have a flip-side but things do seem to be improving.

Obstrobogulous obnubilation...

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Miliband calls for an inquiry (interesting how the BBC changed their headline to big-up Ed, not for the first time...since changed again); Brown was at the heart of the design for what failed miserably; Balls and Miliband were his lieutenants: "no return to boom and bust". We know it was 'self delusion masking rank greed'...no risk. Britain having in place 'the most up-to-date early warning and response system' boasted Brown; it was worth nothing 'if you don't understand the system and its risks', watching Dispatches again is a good reminder. Politicians and bankers were and are living in a fools paradise...and "Right now, we’re seeing the party organizers blaming the bartenders";

But when Ed Balls adds his voice to calls for a Leveson-style inquiry for the banks, we ought to remember how many people have a vested interest in framing the banks for the crash. And is rigging interest rates for personal gain so much worse than rigging them for political gain by pumping cheap debt to the masses and dressing the result up as prosperity or recovery? [Link] (Fraser Nelson at The Spectator).

Obstrobogulous obnubilation...

---

Miliband calls for an inquiry (interesting how the BBC changed their headline to big-up Ed, not for the first time...since changed again); Brown was at the heart of the design for what failed miserably; Balls and Miliband were his lieutenants: "no return to boom and bust". We know it was 'self delusion masking rank greed'...no risk. Britain having in place 'the most up-to-date early warning and response system' boasted Brown; it was worth nothing 'if you don't understand the system and its risks', watching Dispatches again is a good reminder. Politicians and bankers were and are living in a fools paradise...and "Right now, we’re seeing the party organizers blaming the bartenders";

But when Ed Balls adds his voice to calls for a Leveson-style inquiry for the banks, we ought to remember how many people have a vested interest in framing the banks for the crash. And is rigging interest rates for personal gain so much worse than rigging them for political gain by pumping cheap debt to the masses and dressing the result up as prosperity or recovery? [Link] (Fraser Nelson at The Spectator).

Oversized, overspent orphan...

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Yet another Euro summit...so many false peaks: it will not end until it is put out of its misery; what John Redwood says today is the plain and simple truth (as always): "The Euro is not worth a single pound of UK taxpayers money. The money tree is wilting and the reason is clear: Euro countries have overspent and borrowed far too much; there is no more money.

"The Euro remains an orphan currency in search of a country to look after it and support it. Creating a country called Euroland is taking too long for the good of its currency. The rich areas and countries are not willing to prop up all the poorer and weaker countries and institutions. There are now five countries needing special measures and special subsidised loans. It cannot go on like this".

Oversized, overspent orphan...

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Yet another Euro summit...so many false peaks: it will not end until it is put out of its misery; what John Redwood says today is the plain and simple truth (as always): "The Euro is not worth a single pound of UK taxpayers money. The money tree is wilting and the reason is clear: Euro countries have overspent and borrowed far too much; there is no more money.

"The Euro remains an orphan currency in search of a country to look after it and support it. Creating a country called Euroland is taking too long for the good of its currency. The rich areas and countries are not willing to prop up all the poorer and weaker countries and institutions. There are now five countries needing special measures and special subsidised loans. It cannot go on like this".

Ominous omens...

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...they're all around us really but do we ever connect all the dots? "An omen can be good... or not. It can be a harbinger of positive change or a warning of impending doom." writes Dale Sinner (D Sinner, honestly!) in International Man. [Update Monday: please see Dale's comment about this]. Talking of the events - now 4 years or more ago! - leading to the current financial crisis; I think I agree with his sentence: "I don't think I'm a superstitious person, but there are times when events excite some kind of primitive, back-brain sense in me that seems to say, 'Get ready'", almost a fatal attraction or curious fascination like an inability to take ones eyes off an impending disaster: watching a train crash or something. The article is from a US perspective but I'm guessing in many countries, especially the UK, you could write something similar but with details adjusted to local events: "Americans continue to object to bailouts while the government continues to hand them out."...see what I mean?

Ominous omens...

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...they're all around us really but do we ever connect all the dots? "An omen can be good... or not. It can be a harbinger of positive change or a warning of impending doom." writes Dale Sinner (D Sinner, honestly!) in International Man. [Update Monday: please see Dale's comment about this]. Talking of the events - now 4 years or more ago! - leading to the current financial crisis; I think I agree with his sentence: "I don't think I'm a superstitious person, but there are times when events excite some kind of primitive, back-brain sense in me that seems to say, 'Get ready'", almost a fatal attraction or curious fascination like an inability to take ones eyes off an impending disaster: watching a train crash or something. The article is from a US perspective but I'm guessing in many countries, especially the UK, you could write something similar but with details adjusted to local events: "Americans continue to object to bailouts while the government continues to hand them out."...see what I mean?

Orwell­oscope options...

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Atando los cabos sueltos, but not at Los Cabos! More from Canada, this time the Financial Post: I like Peter Foster's phrase "Mañana-nomics". Much of the rest of what Peter says makes good sense and is certainly true in many respects: Barroso spitting the dummy, "Europeans have no desire to be ruled by the likes of Messrs Van Rompuy and Barroso... Sunday’s Greek election solves nothing... [Hollande’s] allegedly bright new alternative policy amounts to less fiscal responsibility and more unserviceable debt" etc. Opportunity knocks...

Orwell­oscope options...

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Atando los cabos sueltos, but not at Los Cabos! More from Canada, this time the Financial Post: I like Peter Foster's phrase "Mañana-nomics". Much of the rest of what Peter says makes good sense and is certainly true in many respects: Barroso spitting the dummy, "Europeans have no desire to be ruled by the likes of Messrs Van Rompuy and Barroso... Sunday’s Greek election solves nothing... [Hollande’s] allegedly bright new alternative policy amounts to less fiscal responsibility and more unserviceable debt" etc. Opportunity knocks...

Obvious outcome II...

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"What were they thinking?..." from Frances Wooley on Worthwhile Canadian Initiative (and good comments on that post). "No one ever seriously considered the possibility that an EU country might not be able to repay its debt... ... the question is: Why?" Click on image to enlarge: the graph is 6 months old but it does tell the story of 'The Much Praised "Convergence" as a Cause'; the failure of the market to differentiate across the Eurozone members and treat all Eurozone governments as the same (paraphrasing Frank J. Lysy via the 6 month link above). Hat-tip Raedwald.

Obvious outcome II...

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"What were they thinking?..." from Frances Wooley on Worthwhile Canadian Initiative (and good comments on that post). "No one ever seriously considered the possibility that an EU country might not be able to repay its debt... ... the question is: Why?" Click on image to enlarge: the graph is 6 months old but it does tell the story of 'The Much Praised "Convergence" as a Cause'; the failure of the market to differentiate across the Eurozone members and treat all Eurozone governments as the same (paraphrasing Frank J. Lysy via the 6 month link above). Hat-tip Raedwald.