Fortsätt till huvudinnehåll

£ slides relentlessly

The relentless slide of the UK pound continues. Commentators try to explain it away by suggesting that it will make exports cheaper but our manufacturing capacity is a shadow of what it was. Britain's biggest "industry" of recent years - making money by moving it around - is no longer an effective means of livelihood. And with most of the world in a similar mess, though not, seemingly, to such an extend, there is not going to be a rush of visitors coming to spend all their money in Britain.

The economic "experts" assure us that there is a danger of deflation, but the falling exchange rate will soon enough translate into higher prices in the shops, and the growing body of government debt will unleash a tidal wave of inflation around 2011.

The interest rate cuts are proving useless except as a means of driving down the value of the £, whilst hitting the thrifty and provident, and since the recession will continue for at least three years longer than the Chancellor has confidently assured us it will end, the government debt will be about three times more than it is counting on, which means that inflation will continue until 2015 or so, probably at the same rate as in the later 1970s.

The whole unfolding disaster is a monument to the incompetence of British politicians and the people who advise them, bankers, and, behind them, the entire body of "professional" economists. In more barbaric times, those responsible would have lost their heads.

Kommentarer

Skicka en kommentar

Populära inlägg i den här bloggen

The dreadfulness of British governance

I wrote to my MP on two entirely separate issues recently. The first was to do with the replacement for the Inter City 125 train, which at £2.6 million per vehicle, is twice as expensive as it ought to be. The second concerned the benefits of a switch from business rate and Council Tax to a tax based on site values. In both cases, the replies were full of spurious, unsubstantiated assertions and completely flawed arguments. This is typical. You will not get an iota of sense from the government on any area of public policy at all - finance, economics, trade and employment, agriculture, housing, health, transport, energy. All junk. If you write to your MP you will invariably receive answers that are an insult to your intelligence, no matter what subject you are writing about. Of course they cannot understand statistics. They are innumerate. Whitehall is staffed with idiots with a high IQ. Look at their IT projects. And mind your purse, they will have that too.
Skicka en kommentar
Läs mer

How much more will the British tolerate?

The British are phlegmatic, tolerant and slow to rouse. Thus there was no great reaction after the terrorist attack in July 2005. The murder of Lee Rigby created a sense of outrage, but nothing more, since it appeared to be an isolated incident. Two serious incidents within a fortnight are another matter. Since the first major terrorist incident in 2001, authority has tried to persuade the public that Islam is a religion of peace, that these were isolated events, or the actions of deranged "lone wolves", having nothing to do with Islam, or to reassure that the chances of being killed in a terrorist attack were infinitesimally small. These assurances are are beginning to wear thin. They no longer convince. If government does not act effectively, people will take the law into their own hands. What, however, would effective action look like? What sort of effective action would not amount to rough justice for a lot of innocent people? Given the difficulties of keeping large n...
Skicka en kommentar
Läs mer

Importing people to sustain demand

I got involved in a discussion with a Youtuber called “Philosophy all along”. This was in connection with criticism of Trump’s policy of deporting illegal migrants, which he argued would be bad for the economy as it would reduce demand. This implies that there is a need to import people to sustain demand. There is no obvious reason why a population should not be able to consume everything that the same population produces. If it can not, then something else is going on. It is a basic principle that wages are the least that workers will accept to do a job. Wages are a share of the value added by workers through their wages. The remainder is distributed as economic rent, after government has taken its cut in taxes. Monopoly profit is a temporary surplus that after a delay gets absorbed into economic rent. Land values in Silicon Valley are an example of this; it's like a gold rush. The miners get little out of it. Rent and tax syphon purchasing power away from those who produce the g...
Skicka en kommentar
Läs mer