Do they think we are stupid?

 Rachel is busy looking to change the fiscal rules.  Currently the Bank of England's vast debt pile is part of the government's problem but Rachel is busy exploring divorcing from the Old Lady of Threadneedle Str so she isn't carrying the debt pile on her books. Who does the Bank of England lent to?  Either banks or the government. So the Government has borrowed TRILLIONS  from the BoE but isnt going to show this vast debt pool on it's books.  Let's start with the Banks. The Bank of England has lend vast sums to the banks following the financial crash of 2008.  What year is it now?  2024?  Hell!! -  that's nearly 20 years ago. Following the financial crash, the banks were required to retain a certain amount of money for liquidity. Where did they get this money?  The Bank of England. The banks weren't happy that they had to hold billions of cash on deposit so the Bank of England (ie tax payers) agreed to pay the Banks interest on the mone...

 Starmer keeps going on about his humble origins. He's the son of a "poor" toolmaker Yet he went to private school and is a public servant yet his declared net worth is £7.7 Million His house in Kentish Town is mortgage free and estimated to be worth £2M His wife is an NHS worker and reported to earn just £50k per year so the £7M is not from her. Kier Starmer was Director of Public Prosecutions - a role than pays £137,179.  A good salary but certainly not one that would allow you to accumulate £7M in wealth. So how has Starmer managed to accumalate £7M in wealth?  Apparently he own 7 acres of land in Surrey which was part of his childhood home and is thought to be worth £10M.  Hang on his net worth is £7M not £17M?  Didnt he come from a "poor" family that just happened to own 7 acres of land in Surrey worth £10M.... In 2023 Starmer had an income of  £404,030 yet only paid £99,431 in tax.  How come? He should have paid £178,633 in ta...

 Ed Miliband and Angela Raynors at this weeks Labour Conferences pledged to end scourge of cold and draughty rented homes. This was clearly aimed at PRIVATE landlords and completely ignores SOCIAL and COUNCIL homes. Today Private landlords have to have a property that meets energy efficiency level of E or better.  There is no such requirement in England, Wales and Northern Ireland for COUNCIL or SOCIAL housing. Scotland does require targets to be met. There are 1.6 Million council homes in the UK There are 4.5 Million social homes in the UK  There are 4.6 Million private rented homes in the UK So over 58% of Tenants are living in cold draughty rented homes owned by the COUNCIL and SOCIAL landlords yet Labour ignore this.  This is yet another example of Two Tier Kier policies. Many councils have introduced Selective Licencing to ensure PRIVATE rental properties meet an acceptable standard.  There is no such requirement for SOCIAL or COUNCIL properties. I exp...

Labour have been in power now just 80 days. Phileas Fogg travelled the world in 80 days, saw new things and experienced new cultures. Like Phileas,  I've been on a learning journey for the past 80 days. The first thing I've learnt is how quickly a regime can change.  We've gone from a relaxed "laissez-faire" government to one that wants to micro manage our lives.  Not content with bashing Greedy pensioners, Starmer wants to interfere in Oasis ticket prices and just about anything he sees on a daily basis.  He's clearly one for rules and regulations - as long as he doesn't have to follow the rules himself. This interfering culture is creating uncertainty.  I am now unwilling to make any long term investment decisions since I don't know whether the rules will change on a whim. Taking this unwillingness to invest further I now realise I am very exposed to long term, difficult to exit investment decisions in the UK.   Belief in money is a human illusi...

 Today Rachel has apparently had a £10Bn windwall. Members of the Bank of England's Monetary Policy Committee (MPC) have said Threadneedle Street will shrink its balance sheet by carrying out £100bn of quantitative tightening (QT) over the next 12 months. I'm confused.  Let's start with the basics.  Tax income is about 33% of GDP yet the government is spending 45% of GDP. The 12% gap is basically £288 Billion of additional borrowing each year of top of the £2.7 TRILLION debt pile. The Bank of England sell bonds on behalf of the government to fund the government credit card. Typical credit card interest rates for UK gilt yields are between 3.5% and 4.25%. So an additional £12Bn each year of interest payments to service the debt.  The typical cost of interest payments today is £114 Bn per year and it will rise. So here's the confusion I have.  The Bank of England is saying it's going to contract money supply and not raise capital yet the budget deficit is not goin...

 The thing about blackholes is they are invisible. They are so big that light cannot escape. In the case of Labour (and previous governments), they can't see vast swirling financial blackholes in front of them.  In the case of Rachel Reeves she managed to find the £20Bn blackhole simply because she created it by paying £9Bn in inflation busting wage settlements but so far she hasn't found the £5 TRILLION blackholes left but the successive morons running our country. In the case of one blackholes it is sucking £100bn per year mostly into foreign governments pockets.  Clearly £100bn is bigger than £20bn but eagle eyed Rachel hasn't spotted it.  Let's start with the basics.  Tax income is about 33% of GDP yet the government is spending 45% of GDP - and growing. Labour, and previous successive governments, are spending more than they are earning so they have been hitting the credit card.  This borrowing has accumulated to a massive £2.7 TRILLION bounds.  L...

 Starmer, in order to deflect news from his disastrous scrapping of pensioner winter fuel allowances,  claims Britain is business friendly and a great place for inward investment of foreign capital. Just how true is his claim? Let's start with corporation tax since it's highly likely a foreign investor would form a company if they wanted to create a business in the UK. The headline rate of UK corporation tax is 19% provided profits are less than £50,000.   The next headline rate is 25% tax if the company makes a profit of greater than £250,000.  Now the band in the middle does not have a headline rate - it's referred to as tapered relief.  The reality is the marginal rate of taxation in this band is a punitive 26.5% tax rate.   The average corporation tax rate across 181 countries world wide is 23.45% so Britain is actually a high tax country if the company makes a reasonable profit.  Contrast the UK's rate with that with the average corporat...