Politics Thread (encompassing Brexit) - 21 June 2017 onwards

[Kopfkino]

8 hours ago, Fox Ulike said:

 

You’ll need to dumb-it-down for me a bit. I’m not an economic expert. Are you? Out of interest, what are your credentials? Genuine question: You certainly sound like you know what you’re talking about.

 

Which is sort of my point.

 

What I would like to know is this. Does it "make sense" ‘ o impose a regulatory barrier between ourselves and our biggest trading partner? And do you need ‘empirical data’ to answer this question?

 

I'm not an expert by any stretch of the imagination, it's just the subject I study but more so I enjoy reading around it and delving deeper. And the one thing that racks me off (more than it should) is the fact economic forecasts seem to be taken as too matter of fact, or even just wholly reliable. Not that they perform much worse than other forecasting disciplines. I like this quote from a relatively young, but distinguished Professor, "On top of this, asking an active researcher in macroeconomics to consider what is wrong with macroeconomics today is sure to produce a biased answer. The answer is simple: everything is wrong with macroeconomics". 

 

Anyway, away from, then yes of course it does not make sense to impose barriers with our biggest trading partner. But also nor does it make sense to have barriers imposed with other trading partners, of which must be added our share of trade is increasing. But that is what being in the customs union does. And the only thing I care about with Brexit is leaving the customs union. I'd love for a deal which is based on reciprocity, with no regulatory barriers erected "it makes sense". New Zealand and Australia trade well by doing deals based on reciprocity rather than common agreement on regulation. China and Georgia trade with each other largely based on reciprocity, managing a trade deal in just 8 months. But no the EU in trade negotiations often acts like a monopolist, do it our way or not at all (yes that's hyperbole). And then we see the EU's protectionist instinct in these negotiations. The persistent, though slightly wavering, notion that there can be no special deal for financial services is case in point. It makes absolute sense for the EU to have as much access to London's financial sector as possible. It's the leading financial centre in the world for a reason. It has the infrastructure, the knowledge, the efficiencies, the law, the language, the deep capital markets, a top pool of talent, its also the leader in the future of fintech and to boot is supposedly the top city to do business in the world. Nowhere in the EU comes close to matching it and none of it is easily replicated, certainly not quickly. EU firms absolutely benefit from access to London's capital markets and financial sector nouse. But the EU wants to make access more difficult for its firms because, well it won't be the EU. And just to add, they'll likely make things more difficult for themselves because won't be there to veto the heavy-handed regulation they love to dream up for financial services. I mean MIFID II has come along and we were around to try to stop it. Just look at how that's affecting London with some derivatives trading moving over to NY as a result less than a month into its implementation. The point is, no it doesn't make sense to impose any regulatory barriers, but its not like what the EU does makes a whole lot more sense. 

[The Doctor]

33 minutes ago, Carl the Llama said:

Pigeons are renowned for their outstanding navigational abilities. They use a range of skills, such as using the sun as a guide and an internal ‘magnetic compass’. A study at Oxford University found that they will also use landmarks as signposts and will travel along man-made roads and motorways, even changing direction at junctions.

But do those feathery bastards show proper lane discipline and indicate? No. 

[Guest]

Be afraid, Tories – even the Davos elite now fancies a bit of Corbynism

Richard Power Sayeed

John McDonnell was a guest speaker because, unlike his rivals, he has a plan for ending the global economy’s structural woes

199

 Follow Richard Power Sayeed

Published:11:31 GMT+00:00 Fri 26 January 2018

 

John McDonnell at the WEC. ‘His series of emollient conversations last year with City executives – his ‘cup of tea offensive’ – seems to have worked.’ Photograph: Steve Parsons/PA

The UK’s business leaders are not, on the whole, committed Corbynites, but last autumn their political centre of gravity started to shift. At the CBI’s annual conference in November, the warmest applause went not to Theresa May but to her rival on the opposition benches. After the Labour leader’s speech, the measured reaction of one captain of industry – “These are great aims. But how will they be paid for?” – reflected the perhaps surprisingly pragmatic response of British business to the prospect of a socialist government.

Few corporations are keen on taxes or regulation, but all will welcome the state investing £250bn in infrastructure and research and development, as well as billions more on education. They are also grateful that Labour has maintained its position as the party of soft Brexit.

Paradise Papers: Davos panel calls for global corporate tax reform

John McDonnell’s series of emollient conversations last year with City executives – his “cup of tea offensive” – seems to have worked.

AdvertisementHide

 

But this morning Corbyn’s key ally presented a less rosy picture when he spoke at the World Economic Forum. Although he wanted guests there to know he’s a man they can do business with, he also made clear that they don’t have much of a choice. “Out there, beyond the Davos compound, many people feel the markets are rigged against them,” he told his audience. “There is an anger building that you have to deal with.” As he warned on Wednesday: “Change is coming either way.”

The shadow chancellor has been invited to Davos because the global elite know he has got a point. “Business … needs to have a societal tone,” admitted John McFarlane, chairman of both Barclays and financial services lobby group TheCityUK, last year. “Ordinary people have spoken out and they are finding it hard.” He concluded, in his interview with Reuters, that Labour’s confidently leftist general election campaign had been “bang on”.

You might think that the forces of global capital really should be a bit more consistently antagonistic towards a party “for the many, not the few”. But consider what motivates the people who were sitting in McDonnell’s Davos audience.

A minority of those who were there – the hedge fund types – are professionally obliged to focus not on grand political questions, but on short-term prospects. Even if they suspect their margins might feel a little pressure from Labour’s redistributive plans, they are principally concerned with identifying how they would make a profit in any likely scenario.

However, different concerns occupy the archetypical guest at the WEF, one of those who might happily chat with Bono and the Gateses in the hot tub after a long day of seminars. They hope a brief spell of social democracy will save capitalism from itself, just as it has several times in the past century.

McDonnell’s long-term goal of a democratic economy is very different to that of WEF ticket-holders, but evidently the conditions for a truce are promising, hence the invitation to Switzerland. The change in tone from business a few months ago was a sign that ideology and power were rearranging themselves.

‘Ordinary people have spoken out and they are finding it hard'

John McFarlane, chairman of Barclays and TheCityUK

The save-capitalism-from-itself crowd hopes Labour and other leftists can cure some of globalisation’s pathologies, social and economic. Since the 1980s and 90s, privatisation has prevented the state interfering, as the free marketeers see it, in what is supposedly the realm of business: creating value.

But as has been elaborated by economist Mariana Mazzucato, the state often leads the way in incubating innovation. Many high-growth areas, from computing and the internet to biotech and nanotechnology, have been identified by the state, supported for years and even made commercially viable by it, long before venture capitalists or big corporations got involved.

Consequently, in the UK’s heavily privatised economy, growth and living standards have depended not on creating value but on merely extracting it, on borrowing from the oil producers of the Middle East and the manufacturers and industrialists of south and east Asia. This global imbalance precipitated and shaped the crash of 2007, and since then the Tories’ response has been to encourage more of the same, so that our economy is still overheated with private debt. Free market policies haven’t just made Britain violently unequal: they have made our economy unstable.

Labour’s manifesto last year offered a solution. Government borrowing will have to increase, but if the state pulls its weight as an investor and an entrepreneur, stimulates growth and helps to rebuild industry and manufacturing in the UK, Britain can become a value creator once more.

This is implicitly acknowledged when even mainstream Tory MPs such as Sajid Javid, Nick Boles and Tom Tugendhat demand an end to austerity or when May starts talking of her “industrial policy”, a vaguely Keynesian phrase all but banned since 1979. Those Tories know Labour’s economic plans are not just popular: they provide a response beyond keeping calm and carrying on.

Few at Davos or in the City will have agreed with every word spoken by the shadow chancellor today, but they are pragmatists. After McDonnell met BlueBay Asset Management in November, the $57bn hedge fund cut its short positions against sterling in half. Previously, its managers had been betting against the pound, but they explained that they had liked what they heard from the shadow chancellor. Indeed, they publicly dismissed fears that if British voters put Labour into office currency speculators might sabotage sterling.

McDonnell’s appearance at the WEF confirmed not only that his solutions sound attractive far beyond his voter base, but also a more pragmatic message: the global elite knows he and Corbyn may enter government very soon, and that by 2022 they could well have been joined by a President Mélenchon and a President Sanders. McDonnell’s rivals at Westminster, and around the world, should be worried.

 

[Guest MattP]

 

I don't know where to start with that, imagine being under the impression a mysonginist bigot who turned up to the despatch box with Mao's little red book is actually going to change the World's economy through excessive borrowing, a bloke who went onto the television a few weeks ago and didn't even know whether the British deficit is going up or down, that person.

 

No mention of Trump's economic reform in there which is probably the most important piece of financial news we've seen since the crash, not a mention.

 

Quote

 

Corbyn may enter government very soon, and that by 2022 they could well have been joined by a President Mélenchon and a President Sanders

 

This is comfortably my favourite part though,

 

Jeremy Corbyn - a man who can't even extend a lead against the worst Tory government in sitting memory

 

Bernie Sanders - a man who couldn't beat Hillary Clinton among left-wing voters.

 

Jean-Luc Melenchon - A man who got less than 20% in the election last year after the ruling socialist party had collapsed. (The idea he could get 50% in a run off is so stupid how a political journalist can write it is laughable)

 

The amazing thing is he will actually have got paid to write this garbage, I need a drink.

Edited 26 January 2018 by MattP

[Guest]

24 minutes ago, MattP said:

 

I don't know where to start with that, imagine being under the impression a mysonginist bigot who turned up to the despatch box with Mao's little red book is actually going to change the World's economy through excessive borrowing, a bloke who went onto the television a few weeks ago and didn't even know whether the British deficit is going up or down, that person.

 

No mention of Trump's economic reform in there which is probably the most important piece of financial news we've seen since the crash, not a mention.

 

This is comfortably my favourite part though,

 

Jeremy Corbyn - a man who can't even extend a lead against the worst Tory government in sitting memory

 

Bernie Sanders - a man who couldn't beat Hillary Clinton among left-wing voters.

 

Jean-Luc Melenchon - A man who got less than 20% in the election last year after the ruling socialist party had collapsed. (The idea he could get 50% in a run off is so stupid how a political journalist can write it is laughable)

 

The amazing thing is he will actually have got paid to write this garbage, I need a drink.

Yeah the last paragraph was different level.

The point about the hedge fund is rather interesting though. Also, I can't see how you can criticise labour for borrowing yet laud Trump for adding trillions to their national debt.

[Guest MattP]

19 minutes ago, toddybad said:

Yeah the last paragraph was different level.

The point about the hedge fund is rather interesting though. Also, I can't see how you can criticise labour for borrowing yet laud Trump for adding trillions to their national debt.

Where have I done that? I said in the Trump thread adding that to the national debt was a concern.

[Fox Ulike]

21 hours ago, Webbo said:

 

 

 

So I didn't say I voted for Brexit based on common sense, I said your figures were bullshit based on common sense, and it turns out I was right.

Yes. Apologies Webbo. Looks like you were right and *GASP* I was wrong. I'm not sure why I had that impression in my head.

 

I do talk a lot of bollocks at times.

[Guest]

15 minutes ago, MattP said:

Where have I done that? I said in the Trump thread adding that to the national debt was a concern.

But I think I'm correct that you've supported tax cuts and infrastructure spending?

[Guest MattP]

7 minutes ago, toddybad said:

But I think I'm correct that you've supported tax cuts and infrastructure spending?

Nope. I support tax cuts but through cutting of the state and not by adding debt to future generations.

 

I don't really have enough knowledge of American infrastructure to comment on his spending on that and how much of a necessity it is.

[Guest]

23 minutes ago, MattP said:

Nope. I support tax cuts but through cutting of the state and not by adding debt to future generations.

 

I don't really have enough knowledge of American infrastructure to comment on his spending on that and how much of a necessity it is.

the highlighted bit is meaningless drivel

[Guest MattP]

4 minutes ago, toddybad said:

the highlighted bit is meaningless drivel

Only if you don't understand economics. Who do you think is going to pay it off? (and more importantly, have less to spend on public services because of the interest)

Edited 26 January 2018 by MattP

[Guest]

12 minutes ago, MattP said:

Only if you don't understand economics. Who do you think is going to pay it off? (and more importantly, have less to spend on public services because of the interest)

Why would a government borrowing at low interest not be able to realise benefits to cover that interest yet you believe the private sector can do so at higher interest rates? 

 

If you build a house you have an asset of equal or more value to the cost and can also rent it out to cover the interest and make a profit. This applies to many government investments.

 

Plus, inflation means that the debt and interest continually reduces in value. Growth has the same effect as a % of GDP.

 

Much as business does, you speculate to accumulate. The fact you believe only one half of the economy can do this suggests you're the one that doesn't understand economics.

[Rogstanley]

17 minutes ago, MattP said:

Only if you don't understand economics. Who do you think is going to pay it off? (and more importantly, have less to spend on public services because of the interest)

Inflation will pay it off as long as UK gov can borrow at a lower rate, as it can currently. The WW2 debt was paid off the same way.

[Guest MattP]

5 minutes ago, toddybad said:

Why would a government borrowing at low interest not be able to realise benefits to cover that interest yet you believe the private sector can do so at higher interest rates? 

 

If you build a house you have an asset of equal or more value to the cost and can also rent it out to cover the interest and make a profit. This applies to many government investments.

 

Plus, inflation means that the debt and interest continually reduces in value. Growth has the same effect as a % of GDP.

 

Much as business does, you speculate to accumulate. The fact you believe only one half of the economy can do this suggests you're the one that doesn't understand economics.

I've not said anything about private sector investement, you have just added that in to try and justify your own point. You assume that we'll still be able to raise bonds at 1.3% to do what you want to do, given your shadow chancellor has already admitted you'll be wargaming for a run on the pound I think that's highly unlikely.

 

Speculate to accumulate? You sound like me when I was begging for £50 in the casino to win it all back. If it was that easy every nation in the World would be swimming in riches and those who had followed your advice wouldn't be crawling to the IMF. We all know where this ends, high debt, high inflation and policy like capital controls to try and somehow keep the show on the road.

 

Now I'm off out for a drink, have a lovely weekend.

[Guest MattP]

Although before I go.

 

 

[Rogstanley]

19 minutes ago, MattP said:

I've not said anything about private sector investement, you have just added that in to try and justify your own point. You assume that we'll still be able to raise bonds at 1.3% to do what you want to do, given your shadow chancellor has already admitted you'll be wargaming for a run on the pound I think that's highly unlikely.

 

Speculate to accumulate? You sound like me when I was begging for £50 in the casino to win it all back. If it was that easy every nation in the World would be swimming in riches and those who had followed your advice wouldn't be crawling to the IMF. We all know where this ends, high debt, high inflation and policy like capital controls to try and somehow keep the show on the road.

 

Now I'm off out for a drink, have a lovely weekend.

Almost every comparable nation in the world does have higher productivity than us and every comparable country in the world does have better wage growth than us? We ARE falling behind.

 

Just how bad do productivity and wages have to get before you realise investment is required?

[Guest]

23 minutes ago, MattP said:

I've not said anything about private sector investement, you have just added that in to try and justify your own point. You assume that we'll still be able to raise bonds at 1.3% to do what you want to do, given your shadow chancellor has already admitted you'll be wargaming for a run on the pound I think that's highly unlikely.

 

Speculate to accumulate? You sound like me when I was begging for £50 in the casino to win it all back. If it was that easy every nation in the World would be swimming in riches and those who had followed your advice wouldn't be crawling to the IMF. We all know where this ends, high debt, high inflation and policy like capital controls to try and somehow keep the show on the road.

 

Now I'm off out for a drink, have a lovely weekend.

Good, go and talk complete nonsense to somebody else. At least if you've had a drink you'll have an excuse for it later 

[Guest]

22 minutes ago, MattP said:

Although before I go.

 

 

World growth is 3.9%

Edited 26 January 2018 by Guest

[Strokes]

1 hour ago, toddybad said:

Good, go and talk complete nonsense to somebody else. At least if you've had a drink you'll have an excuse for it later 

Oh the irony.

[Guest]

Brexit: Britons favour second referendum by 16-point margin – poll

https://www.theguardian.com/politics/2018/jan/26/britons-favour-second-referendum-brexit-icm-poll?CMP=Share_AndroidApp_Copy_to_clipboard

 

[Carl the Llama]

2 hours ago, toddybad said:

Why would a government borrowing at low interest not be able to realise benefits to cover that interest yet you believe the private sector can do so at higher interest rates? 

 

If you build a house you have an asset of equal or more value to the cost and can also rent it out to cover the interest and make a profit. This applies to many government investments.

 

Plus, inflation means that the debt and interest continually reduces in value. Growth has the same effect as a % of GDP.

 

Much as business does, you speculate to accumulate. The fact you believe only one half of the economy can do this suggests you're the one that doesn't understand economics.

Re. Houses, do you not intend for citizens to own them then if the state's renting out? IMO we need a govt that's willing to build affordable housing, not a national landlord, we already have too many landlords.

[fuchsntf]

1 hour ago, toddybad said:

World growth is 3.9%

Nope!!!

 My grans tape measure tells us, we are shrinking 23cm longitude +  43.8211 cm Latitude. Every year..

[Guest]

6 minutes ago, Carl the Llama said:

Re. Houses, do you not intend for citizens to own them then if the state's renting out? IMO we need a govt that's willing to build affordable housing, not a national landlord, we already have too many landlords.

Oh, absolutely I'm fine with that. But the government can still turn a profit whilst keeping the prices cheap. I would expect that it would rent and allow right to buy to continue with profits turned into more houses. A perfect scheme.

[Buce]

24 minutes ago, toddybad said:

Brexit: Britons favour second referendum by 16-point margin – poll

https://www.theguardian.com/politics/2018/jan/26/britons-favour-second-referendum-brexit-icm-poll?CMP=Share_AndroidApp_Copy_to_clipboard

 

 

No movement from the coffin-dodgers or the Little Englanders though.

[Guest]

18 minutes ago, Buce said:

 

No movement from the coffin-dodgers or the Little Englanders though.

Perhaps not but most of them have profited from social policies that they've voted away so I can't wait for the day they finally get ignored by a government.