The Month That Was……August 2025

I was informed this month that nine in ten UK households admit to having bad energy habits that are costing them over £200 per year (price comparison site Uswitch).

Just what sort of operation are these nine in ten households running where hundreds of pounds are being wasted and the planet is dying just a little bit more each day?

I mean, for goodness sake, more than 50% of households “admit leaving unnecessary lights on”. That can’t be right surely? How can this be? Surely every house has a grumpy man storming round the house like an angry ecowarrior roaring “who left all the lights on?”. Because that is all you need to save the earth and beat the cost-of-living crisis……someone standing in the hall shouting, “There’s a light on in the upstairs bathroom and it wasn’t me who left it on because I don’t use the upstairs bathroom!”. And then, when there is no response, adding, “I thought your generation cared about the polar bears!”

And what of this “too much water in the kettle” that is reported to cost households £40 a year? I simply don’t understand. Are husbands up and down the country failing to come sprinting in from in front of the TV to empty all but a cupful into the sink when they hear their wife putting the kettle on for tea.

Perhaps they are worried that they will get the same sort of angry reaction from their wasteful wives that I got last night from Rachel, who yelled, “I was boiling that water for the kid’s pasta!”.

“Fair enough,” I told her. “But turn that tap off when you’re talking to me……and why are you running it while washing up anyway? That’s costing families up to £11 a year, that is.”

My goodness, it is hard work being a domestic ecowarrior like me. It makes me want to leave the survey results lying around in the hope that my family will see them and grasp that I’m not just making all this up. Like the £32 a year that is literally evaporating in 65% of households each year because of saucepans being boiled without the lid on.

And don’t get me started on “running the dishwasher when it’s not full”, which costs every family £10. Yet fortunately I can see that by turning all the cups round so the handles are on the same side, and then rotating them so the handle is at 45 degrees to the perpendicular instead of 90 degrees, they will tuck in more tightly and can be shuffled up to make room for at least two more.

I don’t think anyone realises the energy it takes to haul myself up from the football when Rachel is cooking, to come into the kitchen and noisily cover all the saucepans on the hob. It’s tiring.

Do you think I take three houseplants with me into the shower for the good of my health? No, it’s a cupful of water a week that won’t be wasted watering them.

Imagine my disbelief when I read of the £31 per household per year lost to “using the tumble dryer when it’s hot outside”. We haven’t used our tumble dryer in three years. Rachel thinks it’s broken but I just took the fuse out, obviously. Same as I disabled the heater in our electric car. Even if I’ve smart-charged it at the cheapest rate, I worked out that it costs around 9p an hour to warm the car on a frosty morning or close to 5p on an average school run. Five pence! Not gonna happen on my shift. That’s what driving gloves are for. I got her a pair for Christmas. Preloved obviously.

Probably the greatest day of my life was when I realised I could reduce the target temperature of our domestic boiler from 70C to 64C without compromising the quantity of hot water available or the warmth of the house……saving untold kilowatt hours and dozens of pounds a month……with only a 30% risk of cultivating Legionnaires Disease in the underheated tank. What a day that was.

My next task? To save the £1.90 a year burnt away by “leaving the TV on when nobody is watching”. Who does that? (unless it’s football on, obviously). Dads who are serious about the environment switch the telly off even if people ARE watching it. It’ll only be some rubbish anyway. What you do is go in and say, “What are you watching?” don’t wait for an answer, turn it off, then leave. Turning the lights off as you go, obviously.

I have come to accept that my life has morphed into a one-man domestic ecowarrior. And I like it.

The Numbers

August can be a bit of a numbers non-event in my world as those with too much to say or too much responsibility down tools. But the 2025 offering was really quite the feast.

The Bank of England’s Monetary Policy Committee (MPC) voted 5-4 in favour of lowering borrowing costs by 0.25% to 4.0%, the lowest level in over 2 years. This is the 5^th interest rate cut since the 2024 General Election.

For the anorak wearers amongst us……the ultimate decision required 2 votes after an initial ballot was inconclusive. It was the first time the MPC required two ballots to reach a majority rate decision since its inaugural vote in 1998. You’re welcome.

Inflation rose from 3.6% to 3.8%, with the Bank of England warning that inflation will scale to a near 3 year high, projecting that inflation would hit 4% in September. This is a key month for inflation news as the rate is used for State Pension increase calculations. Another economic headache for Rachel Reeves.

The higher inflation is being mainly driven by higher food, energy prices and rising household utility bills.

Food price inflation hit 4.2%, a 17 month high. The increase in employer national insurance contributions and increase in the minimum wage has increased labour costs that are likely to have pushed up food prices. Food price inflation is likely to rise above 5% later this year as businesses are having to pay a packaging levy to fund recycling.

The energy cost announcement from Ofgem highlighted that gas and electricity prices will rise by 2% for millions of households under the latest cap announced from October.

In addition to food inflation, the other significant consequence of Rachel Reeves 2024 Budget has been the reduction in confidence in the economy among business leaders. The impact of the cost increases for business and rumours of further tax rises in the next Budget has seen the optimism index slide from -53 to -71, the lowest level since the Brexit vote.

The knock on impact of a loss of confidence in the economy is also a lack of confidence in Rachel Reeves. This in turn has a knock on impact on the cost that the Government must pay on debt. The cost of which rose to 5.63% this month, putting it near a 27 year high (on 30 year bonds).

Elevated borrowing costs have led economists to warn that Rachel Reeves will need to increase taxes by up to £30 billion at the Autumn budget to comply with her fiscal rules, having already raised them by £40 billion last October.

Yet more taxation? More taxation it seems is a bandage that can never staunch the wound. I am starting to question if the problem is State spending being out of control and getting higher. There are two ways to look through a telescope……perhaps it might be better to look through the right end. Just a thought.

And what of The Trump and the US I hear you (very quietly) ask? Well, wacky as ever!

US job growth slowed sharply in July and the unemployment rate rose as businesses navigated uncertainty over The Trump’s trade war. The US added just 73,000 jobs this month, well below the amount expected by economists. While the unemployment rate rose to 4.2%.

That left The Trump with only one option…… he fired Erika McEntarfer, the head of the US Bureau of Labor Statistics (BLS) after claiming jobs figures had been “rigged in order to make the Republicans and me look bad.”  The Trump provided no evidence to support his claims……who’d have thought it!

US inflation held steady at 2.7%, raising bets that the Federal Reserve will cut interest rates in September. This is definitely one to watch as markets will be all over this.

My favourite number this month was……5……the number of miles walked hanging on for dear life walking the canyon of the Caminito del Rey.

Trump of the Month

Plenty of lunacy options to choose from this month. A syndicate of succulent silliness.

August 2025 marked the moment when Andrea Jenkyns, one of the great thinkers of our generation (not), dropped a bombshell during a Reform UK press conference.

Following on from the historical atrocities of “Blair’s babes” and “Cameron’s cuties”, Jenkyns has decided this need to refer to female politicians as a subgroup must continue……“I’m proud to be one of Farage’s fillies” she told the press conference……looking very pleased with herself (as usual).

What was she thinking? Will any other women self-identify as a Farage filly? Will the fact that Farage filly suggests you have a face like a horse discourage potential advocates? What next, offering female politicians a sugar lump? Does any woman want to be a political horse? I guess we’re about to find out. Sheer stupidity.

Ed Miliband re-entered the craziness after coming under extreme criticism from the Government’s climate advisers. The Energy Secretary has made “no progress” on making electricity cheaper over the past year, despite his pledge of it being a “number one priority.” A unit of electricity costs almost four times that of gas……the worst ratio in Europe. So exactly what else has the Energy Secretary being doing? 

Mark Wild the latest excuse of a Chief Executive of HS2 has made a solid contribution to lunacy. A fraud investigation will now take place into HS2 over allegations of “large-scale” financial impropriety. The company responsible for building the high-speed rail line has referred itself to HMRC after completing an internal review which highlighted that a subcontractor may have been committing tax fraud. In short, a subcontractor working on the project had falsely declared self-employed workers as directly employed staff and charged inflated rates, including submitting fake payslips to auditors.

I am not sure what I am most offended by……insufficient due diligence on the subcontractor receiving ‘our’ money……the auditor not picking up on the fraud (it was a whistleblower that highlighted the issue)……or the fact that I am simply not surprised by any incompetence offered by HS2. Nuts on every level.

Secretary of State for Business and Trade, Jonathan Reynolds, offered plenty of head scratching opportunities this month. A report into the Department for Business and Trade (which he fronts) efforts to recoup fraud-related losses from the £47 billion covid bounce-back loan scheme have been “passive” and “largely unsuccessful, with only a small fraction of losses recovered”. The Government has estimated that at least £1.9 billion of pandemic loans have been flagged as suspected fraud. This is in addition to the £10.5 billion the Government has paid to banks under the state guarantee for loans that went bad. Any chance of a little more effort Jonny?

And don’t get me started on Gillian Martin (the Scottish Energy Secretary). In short, households have paid £810 million for Scottish wind farms not to produce planned electricity output over the last 6 months as the national grid did not have the capacity to move it to where it was needed.

I’m no expert in renewable energy but it’s absolutely crazy to build wind farms where there’s no grid, then pay them to sit idle and then pay the most expensive fossil fuel plants to generate the power instead.

Gillian Martin said: “I have been clear that the current UK energy system is not fit for purpose.” Ok, so make it fit for purpose then. Mental.

And what to make of Angela Rayner? Her department (Ministry of Local Government) said "a significant amount of money" could be saved by merging councils in 21 areas into single authorities. A £2.9 billion saving over 5 years……I’m all for that.

Except it has come to light this month that the department based its cost estimates on a 2020 report by County Council Network. The figures have now been reworked and, you guessed it……the reorganisation is likely to make no savings and actually cost money in some scenarios (up to £850 million extra). Take a bow Angela Rayner……impressive lunacy.

Which leads me to suggest that David Goldstone, the head of the Office for Value for Money might just be offering us maddening levels of incompetence that is off the scale. The department was set up to ‘root out waste and inefficiency’. So why is it not scrutinising the above?

It’s not like the stories are buried and difficult to find. If I read them, surely somebody who is responsible for ensuring public money is well used must raise an eyebrow? Surely! Exactly what else are we paying David Golstone a daily rate of £950 to do?

August 2025’s Trump of the Month could only go to…… David Goldstone.

I think we are now at the stage that we need to set up a department to investigate if we are getting value for money from the Office for Value of Money.

It shouldn’t be like this. Absolutely bonkers.

Trump Lunacy Rating: 10 / 10

And Finally……

“Money often costs too much.”

Ralph Waldo Emerson

The Month That Was……July 2025

July saw the one year anniversary of Labour getting into power. As anniversaries go, this was right up there with the Brexit Referendum anniversary in June.

On his first anniversary, you would expect the Prime Minister to be all over the media blowing his own trumpet (or any musical instrument involving wind for that matter) and doing a political lap of honour. Instead, he went on the Sunday morning political TV programmes to explain that he didn’t make Rachel Reeves cry during PM Q’s the previous week.

If ever there was a metaphor……the Chancellor of the Exchequer in floods of tears behind a Prime Minister who carries on regardless……oblivious to the train crash happening behind him. How apt.

When asked whether Rachel Reeves was for the chop……Keir paused……and then didn’t answer the question. So, the financial markets wobbled like only a Rachel Reeves chin can……the cost of Government borrowing shot up……and then finally Keir confirmed……oh, go on then, she can stay a little longer……pacifying all things financial for 10 minutes.

It was the most surreal political scene since……Liz Truss’s 10 minutes of fame……no hang on, BoJo’s lockdown lies……wait, Matt Hancock's kiss / grope during Covid……(in fact, insert anything to do with the Tories since the Covid outbreak).

The most remarkable thing about this Government is that they have had 14 years to prepare for this moment. 14 years of saying it’s their fault, followed by 1 year of saying it’s their fault from the other side of the house.

Inspirational leadership it is not. A political mess, it is. U-turns, incompetence, a split party, no direction, et al. Labour were voted in to change things……but there has been no difference whatsoever. Tory chaos rebadged with a red tie. Even Labour’s backbenchers have had enough of the political ineptitude.

The key thing about politics is that you have to get elected and then you have to deliver what you said you were going to do. Wake up Starmer……20% of your time in Government has gone already. A majority of 165, yet he looks absolutely clueless. We need better. We deserve better.

And the biggest winner in all of this…… Nigel Farage. 

Enough now.

The Numbers

The narrative dominating the numbers was the Office for Budget Responsibility ringing the alarm on the ballooning trajectory of public debt and the widening budget deficit. It was another reminder for the Government of its perilous fiscal situation.

And the figures are not good reading:

- UK debt interest spending for the month jumped to £16.4 billion, the second highest for a month since the records began in 1993 (behind only June 2020, which was heavily affected by the pandemic).

- Borrowing, essentially the difference between public spending and tax income, was £20.7 billion for the month, up £6.6 billion from the same month last year.

- £1 of every £10 of Government spending is spent servicing Government debt.

Big figures, which are compounded by the cost to borrow.

The rate on the 30-year UK Government Bond (or gilt) now stands at 5.43%, up from 4.67% compared to a year ago. By comparison, the US equivalent has risen to 4.93% from 4.48% over the same period.

It is clear that Reeves needs tax income……and quick.

The biggest rumour seems to centre around a wealth tax, which Reeves believes will raise around £10 billion. However, 80% of the potential revenue will come from just 5,000 people……and 15% from just 10 people. So, it would just take a handful of people changing residence and it could remove billions.

Another option is to remove the triple lock on the State Pension (the promise to raise the state pension every year in line with the highest of consumer price inflation, average earnings, or 2.5%). Raging inflation and wage growth since 2021 has meant that the policy will end up costing £16 billion by the end of the decade compared with original forecasts of £5 billion. With inflation jumping to 3.6% this month (the highest since January 2024), this is a strong consideration……but clearly not a vote winner!

Keir was pushed and prodded on whether he was ruling out extending the stealth tax. He refused to say whether the Government would lift the freeze on income tax thresholds in 2028, as it has previously stated. Freezing income tax bands for longer would drag an estimated 1 million people into higher rates by 2030.

No doubt further options will be rumoured but this will be a theme running up to the Autumn Budget as the Chancellor will look to raise as much as £30 billion.

Debt was a key theme also in the US this month as The Trump’s ‘One Big Beautiful Bill’ passed through the Senate by one vote. Estimates suggest the fiscal impact of the bill will add $2.4 trillion to deficits over the next decade, with a total debt increase of $3.0 trillion.

Don’t panic though……The Trump is still flexing his orange muscles as he threatens 30% tariffs on Mexico and the EU bartering him down to 15%.

My favourite number this month was……6……the little lady finishing Year 6 at Primary School with the School Girl of the Year award tucked under her arm as she skips towards Senior School.

Trump of the Month

I am not messing about this month. The Trump of the Month award for services to lunacy has to be…… Keir Rodney Starmer.

See above.

End of.

No further questions your honour.

Trump Lunacy Rating: 10 / 10

 

And Finally……

“Incompetence is often highly regarded in governmental circles.”

William Wallace

The Month That Was……June 2025

June has been a funny old month of jumping from one video conference to another for regulatory briefings, pension legislation changes and economic guidance. I know……living the dream. It really feels like death by webinar.

One of the most disturbing things I have learnt is that we are now morphing into a completely different language. And quite frankly, I am baffled by the moronic meaningless maunder.

“Just to bring you up to speed and take a deep dive before we circle back and drill down on the granular detail” was the opening line from Hugo on my webinar last week. When Hugo caught someone smirking on video (it wasn’t me, I was wiping the blood from my eye as I had stuck a fork in it) he responded with “I am pivoting to get you up to speed so you can hit the ground running and start on a level playing field.” Wow……and this was from a compliance consultant.

The day before, Casandra provided detailed analysis of new pension legislation by delivering “no one is trying to reinvent the wheel here, I’m just reaching out to run a few ideas up the flagpole and see who grabs the low-hanging fruit.” And just for good measure, apparently it is “going to require a paradigm shift in your attitude and a step change in gear.”

When I reached my third webinar of the week, I quickly looked to see who was presenting…….Dave. Thank goodness for that. A proper steady name and one that won’t be new-world brown box thinking. That was until the second minute when he let me down with “no one is trying to reinvent the playing field because I just wanted to loop you into a holistic approach from the get-go.” That handy fork was now in my other eye.

Perhaps the most disturbing thing of all is that the linguistic disease is highly contagious. I have since found myself “putting ducks in a row”, “getting plenty of boots on the ground”, “optimising the visuals” and “synergise to energise”.

Be very careful out there guys as it’s like the wild west as the sound bar is totally transmittable.

I’m off for some blue sky thinking to ensure I am an early adopter to move the needle on all things mission critical to ensure core competency.

Or alternatively, shoot me now.

 

The Numbers

This month’s numbers were dominated by Rachel Reeves Spending Review and announcement to Parliament.

The hours, days, weeks and even months after a Spending Review can feel like peeling away the layers of an onion.

First, there is the speech from the chancellor in the Commons: the political rhetoric and the numbers often designed to sound big but which are often incomprehensible. Then there are accompanying documents……in this instance in particular a blue-covered, 128 page tome crammed with words, numbers and graphs.

And as the detail is pored over, elements that were not put up in lights by the chancellor become clearer.

The main political message of the spending review was to announce plans to “renew Britain”, betting that £20 billion a year in extra funding for public infrastructure such as railways, roads and power would spur the economy and improve living standards by the time voters go to the polls. Reeves promised an extra £29 billion a year for the NHS and cut spending elsewhere to channel money to “our most treasured public service”.

Reeves’s ferociously tight numbers leave no room for downturns, pay strikes, trade wars or shooting wars. Her plans also depend on £14 billion in hazily detailed “efficiency savings”. Significant tax rises look far more likely come the next Budget in Autumn.

Public spending is running at 44% of GDP, a historic high. Taxes, too, are historically high and universally expected to go higher.

Her report highlighted that, not only have we been spending like crazy (not least because of the pandemic) but we’ve been spending money we don’t have. The resulting annual bill of more than £100 billion just to cover the interest on our debts is quite the burden.

These numbers can be hard to put into context so consider this way of looking at it……we are now spending £23,757 for every adult in this country, which is roughly 65% of the average full-time salary (£37,500). That includes £3,807 on health, £5,817 on welfare and pensions and a shocking £1,955 for that debt bill.

Now, just for a bit of fun……restrict the calculation to those of working age and spending is above £30,000 a head. Factor in economic inactivity and the state is spending nearly as much as workers aged 18 to 65 are earning.

This is very obviously not sustainable, so is Rachel Reeves the right person to find the solution?

Elsewhere……

Love or loath, Amazon is ploughing in another £40 billion to the UK over the next 3 years for yet more expansion plans. Amazon is now one of the UK’s top 10 private employers with 75,000 members of staff.

And spare a thought for Elon Musk……his net worth dropped by $34 billion in a day as his personal feud with The Trump hit Tesla’s share price. The fortune of the world’s richest man fell to $335 billion, with his net worth declining by $98 billion since January. It is clearly an expensive hobby to be associated with the orange one.

My favourite number this month was……800……the little lady put on a fine display in the 800 metres at sports day.

 

Trump of the Month

There was some classic lunacy at front and centre stage this month and it wasn’t hard to find.

Elon Musk and The Trump ended their bromance over social media in a tit-for-tat slanging match in response to Musk disagreeing with The Trump’s proposed economic bill. Musk declared "I'm the reason Trump won!" and that The Trump was on "Epstein’s client list!" What Musk failed to mention is that he spent $275 million to elect a man he apparently knew to be ‘associated’ with Epstein. Crazy.

The Trump rose the lunacy stakes further by placing a travel ban on 12 countries after the targeted Boulder terror attack, yet didn’t ban the country where the attacker was from (Egypt).

There are clues as to why that is the case……the US and Egypt have a strong defence alliance……a partnership that the US calls a "pillar for regional stability". Egypt is one of the biggest beneficiaries of US economic and military aid in the Middle East, receiving a total of $1.4 billion from US agencies.

Then there was The Trump bombing Iran. In typical fashion……he created a problem……backed down……said he solved the problem……patted himself on the back.

And don’t get me started on Rachel Reeves desperate political u-turn on the winter fuel payment. It’s amazing how things change. Just a few months ago Rachel Reeves told us the financial situation was so grim she had no choice but to take the winter fuel payment from all but the poorest pensioners. And now, thanks to Labour, it’s all going so well she can afford to give it back. Utter madness. She must be on borrowed time.

All worthy, but this month’s Trump of the Month for absolute dedication to lunacy is……Daniel Hannan. I have waited 9 long years for this.

This month marked the ninth anniversary of the EU referendum of June 2016. This is a date that will be seared in many of your brains and will, for all the wrong reasons, be a permanent fixture in history books.

What you might not be aware of is that June 2025, is also a symbolic month……this is the date that featured in an article written by Conservative Party member, Vote Leave co-founder and former MEP……Daniel Hannan.

In his piece written two days before the referendum, Hannan invited us to cast our minds forward to June 2025 and imagine a utopian world where Britain is no longer part of the European Union. He writes of Independence Day celebrations with fireworks, improved relations with the EU and a country where the economy, democracy and liberty have all been reinvigorated thanks to nine years outside the EU.

Meanwhile, in Hannan’s imaginary world, the EU “continues to turn inwards, clinging to its dream of political amalgamation as the euro and migration crises worsen. Its population is ageing, its share of world GDP shrinking and its peoples protesting.”

And the article goes on like this for several paragraphs of sunlit Brexit uplands.

Of course, none of this has come to pass. Instead, Brexit has left the UK isolated, had a disastrous impact on the economy and is widely acknowledged by even the staunchest Brexiteers as being a failure of epic proportions.

And what of Hannan now? What was his punishment for misleading voters? A peerage to the House of Lords by none other than……Boris Johnson. If anybody knows anything about lunacy and being rewarded for failure, it’s Bo Jo.

Good luck explaining that to any rational person. UK political craziness as its finest.  

Trump Lunacy Rating: 10 / 10

 

And Finally……

“One person's craziness is another person's reality.”

Tim Burton

The Month That Was……May 2025

Conquering and improving allows me to grow and build confidence as a person. It makes me a better version. I am always looking to test myself and May has been a challenging month for sure.

I managed to bring the emptied wheelie bin back in without having a quick peek inside first. It was a struggle to begin with but then a significant win.

I took a taxi journey and avoided asking “you been busy” and I didn’t end the journey with “anywhere here’s fine.” I know, revolutionary.

I walked past a large house without making the usual boring comment on what the heating bill must be like and how I wouldn’t like to cut the grass. Progress.

I didn’t stare at the washing machine for the first few spins after switching it on just to make sure. A small victory.

I visited a garden centre and was able to resist the thrill of having a go on a swinging garden bench. I also avoided buying what is essentially a home-made jar of Branston Pickle, just not as nice, for £8. And just to show off, I refused all offers of help to carry compost to the car despite completely forgetting that I have the strength of a child. Treble win.

I ventured to my Sainsburys Local, placed the items on the shop counter and managed to avoid the compulsory “just these please.” Clearly a win in any decent person’s eyes. However, it created a counter problem in that the shop assistant then asked, “is that everything”. It was a bolt out of the blue……I just didn’t see it coming. I might need to go back to the drawing board on this one. I did manage to hand over a note to pay without adding "sorry I don't have any change" (as if the shop doesn't have a till full of coins). A small victory.

(no, I didn’t use the self check out……I decided I could better use the 20 minutes trying to “find item” that needed weighing).

I avoided telling anyone within earshot that I am “all over the place this week with which day it is” due to a bank holiday. Which psychopath puts two bank holidays in May anyway? That’s a double challenge. This was my biggest win of the month.

It’s not all been straight wins though……there is still room for improvement.

I still haven’t managed to avoid saying ''it looks like rain'' at the sight of a few dark clouds……or trying the handle after locking the door, just in case……or whispering "you're welcome" as quietly as possible when I hold the door open for someone who offers no gratitude……or pay for petrol without looking back at the pump number 12 anxious times before paying.

I am sure you would agree that I’ve had a positive month of personal growth……but clearly it is a work in progress. Still plenty to work on.

 

The Numbers

Like him or not (no need to answer that one), the big news centred on The Trump’s inconsistent (who would have thought it) approach to trade tariffs and three deals that he has / hasn’t struck. The moving of economic goalposts on an (almost) hourly basis will have the most astute dizzy……so sit tight……here goes……

US Trade Deal #1

From absolutely nowhere, the UK was first in line. Now, I have been pretty scornful of Keir’s kiss ass approach to The Trump and the grovelling way he has bowed to the President with a letter from the King. However, he might just have played a decent hand.

The economic deal reduced tariffs on car imports from 27.5% to 10% and tariffs on steel and aluminium to 0%. The blanket 10% tariff on UK exports to the US remains in place. Keir said that “it was jobs saved, jobs won but not job done.”

However, given the starting point and The Trump’s attitude to tariffs on other countries, it felt like a win (of sorts).

US Trade Deal #2

Well, not so much of a deal……more a pause on being an idiot. The United States and China agreed to pause reciprocal tariffs temporarily and co-operate to avoid rupturing the global economy. When The Trump announced 145% tariffs on Chinese goods, it felt like an act of economic war……with a 60% chance of a recession the world over predicted.

Much lower tariffs between China and the US, albeit for 90 days, will further fortify hopes that The Trump is still a dealmaker at heart. Fingers crossed.

US Trade Deal #3

Again, not so much of a deal……more a slap in the face if you don’t bring the teacher an apple. If you are not playing the game properly, The Trump will flex his muscles in a breath. Just ask the EU……as he has announced a 50% tariff on all EU goods from 1^st June (then extended by a month for no apparent reason) as he complained that the EU was “very difficult to deal with” and that “our discussions with them are going nowhere”. Perhaps Keir deserves a little credit after all.

Despite The Trump claiming at the start of the month that he had already “struck 200 deals” on tariffs with foreign leaders and that negotiations with foreign powers would be “finished within 3 – 4 weeks”, he has yet to release details of any agreements other than with the UK.

Still with me?

Then from absolutely nowhere, The Trump’s economic agenda was thrown into turmoil when a federal court ruled that his worldwide tariffs were unlawful and should be overturned. A panel of three judges on the US Court of International Trade found that Trump lacked the authority to begin his trade war and the court ordered the tariffs be “vacated”.

Where does that leave us? Who knows……to be continued……

The best way to track The Trump saga is to watch the yield on treasuries. These are the bonds the United States Government issues to raise money (their version of a gilt). Yields reflect what markets think about the credibility of a Government’s finance plans…….it’s a simple measure of confidence.

3 years ago the rate on the 30-year treasury was just 3%. To put it another way, investors wanted a 3% return to agree to lend money to the US Government for 30 years. Now it is 5%. It has only been this high twice in 20 years. What is remarkable this time is how quickly US yields have risen to show a significant lack of confidence in The Trump’s trade plans.

Then add in the impact to US companies that build and provide services across borders, the situation is a chaotic mess. Take Apple as an example (see last month’s Trump of the Month)……the tariffs will cost the company about $900 million in the current financial quarter alone.

Whilst all of the topsy-turvy trade talk continues, The Trump is trying to push through a tax cuts bill in what he described as “one big beautiful bill” that would continue the cuts made during his first term. In other words, he wants to raise debt beyond the bulging $2 trillion a year budget deficit. It was no surprise that the US has been stripped of its top-notch credit rating by Moody’s.

A little closer to home……

The Bank of England’s monetary policy committee, the 9 member panel that sets the base interest rate every 6 weeks, voted 5 - 4 in favour of lowering borrowing costs by 0.25% to 4.25%. However, with the latest gloomy inflation data, interest rates are not predicted to lower much further in 2025. 

UK inflation jumped to its highest level in more than a year……pushed higher by a range of household bills rising sharply in “awful April”. The Office for National Statistics (ONS) said inflation climbed to 3.5% (up from 2.6%) the steepest level since January 2024. Food inflation climbed to 3.4% and services inflation, which is closely watched by the Bank of England, rose to 5.7% and above the Bank’s expectation.

Keir announced a second trade deal of the month……with India, the 5^th largest economy in the world. Presumably this was a little easier without The Trump flexing his orange muscles? Most important of all is the opportunity it gives the UK to catch up after years of underperformance in trade with India. India is only the UK’s 12^th largest export market and the UK has only a 2.1% share of India’s imports despite more than 9,000 businesses exporting there. There is clearly scope for these figures to be improved upon.

India will remove or reduce tariffs on 92% of UK goods exports and UK firms will be granted access to around 40,000 Indian procurement contracts with a value of at least £38 billion a year.

And then for the hattrick……a new trade deal with the EU. Since the UK formally left the EU in 2020, trade and cooperation between the two sides have been governed by the Trade and Cooperation Agreement (TCA). However, this arrangement led to significant friction, particularly for food exporters, manufacturers and travellers. UK exports to the EU fell by 21% and imports by 7% since Brexit. So, Keir set about a “more promising and pragmatic, growth-focused approach.”

The devil is always in the detail and the small print will take quite some time to truly understand the benefits of the new trade deal. However, the biggest concession that the UK had to make was extending the agreement that grants EU fishing vessels continued access to UK waters……for 12 years!

My favourite number this month was……23……a company birthday……the number of years that Davison Smith has been trading!

Trump of the Month

Quite a gaggle of worthy nominees to consider this month……

Donald John Trump was a strong consideration. After digesting the news that he has the lowest approval rating after 100 days of a President in 80 years, he went rogue by suggesting the need to reopen Alcatraz as there has to be another place in the US for dangerous repeat criminals.  Presumably, the White House only has so much room. This was closely followed by a declaration that “I’d like to be Pope.” Wow.

George Gideon Oliver Osborne (remember him?) emerged as a strong candidate. NatWest has taken another step towards escaping the shadow cast by its £45.5 billion taxpayer rescue after its stock price rose above the bailout price for the first time in more than 14 years. The downside is that the Government has been selling NatWest shares at far lower prices for years and now owns less than 1% of the company. The taxpayer will have made a multibillion-pound loss on the rescue because all previous sales of NatWest stock have occurred below the bailout price! Yeah, good one George. Farcical.

Edward Samuel Miliband (another blast from the past) put himself in the running as a report highlighted that his department racked up a bill for domestic flights worth more than £40,000 during Labour’s first 6 months in power.

And just for absolute clarity……Ed is the Energy & Net Zero secretary! The trips come on top of overseas travel by Miliband, who has also undertaken long-haul journeys to attend international summits aiming to tackle climate change. Astounding hypocrisy!

Elsewhere, a Government report has been produced that suggests that insider dealing could be taking place before as many as 1 in 3 company takeovers in the UK……but yet it still continues. If only we lived in a developed country with the most heavily regulated financial systems in the world. Ah……

All worthy of consideration but this month’s Trump of the Month was thoroughly deserved by…… Nigel Paul Farage.

Farage has all the characteristics of craziness to rival The Trump if he was given a little more limelight to shine on some of his antics. Some of his lunacy goes under the radar, which is such a shame quite frankly.

Never one to miss an opportunity to flex his racist muscles on immigration, enter Farage from stage right to proclaim that it will be “20% cheaper to employ an Indian worker” as part of the new UK-India trade deal. It stoked a fire with certain elements of society that don’t need much prodding……yet Farage selectively missed the point……and truth.

At the heart of Farage’s issue is a provision in the trade deal that Indian workers will no longer have to pay national insurance contributions for up to three years while in the UK and will now be 20% cheaper to employ. 

Yet the point is, it stops the need for workers on short-term visas from paying social security and national insurance in both the country they work in and their home country. What Farage has selectively failed to mention is that the UK has similar reciprocal agreements with more than 50 other countries, including the US and EU. All the UK has done is extend the double contribution convention to one more country.

Farage and Reform UK position themselves as defenders of UK workers……yet this is simply a headline grabber for Daily Mail readers.

Farage has taken this right out of The Trump lunacy playbook……and that should be recognised and commended. Utter craziness.

Trump Lunacy Rating: 10 / 10

 

And Finally……

“Racism is a refuge for the ignorant. It seeks to divide and to destroy."

Pierre Berton

The Month That Was……April 2025

Oh, man. Where do I even start with April 2025?

I guess I better get the two ‘t’ words out of the way first……Trump……tariffs. There was a third ‘t’ word but my daughter reads this. You get my drift though.

If you are a little t-worded out, now would be a logical place to hop off. No offence taken……I get it.

To understand the whole tariff mess, there is a need to understand why The Trump is doing it firstly. In essence, The Trump doesn’t like the global trading system. For more than a generation, the US economy has been dragged hideously out of shape by a massive financial distortion caused by the way investors use the dollar.

The dollar solves a dilemma. When a country accrues lots of savings, perhaps because it sells huge amounts of oil or has built a whole economy around battery or semiconductor exports, it needs to store the cash. Storing it in the country’s own currency presents two problems.

The first is that a lot of these countries have volatile exchange rates because they are ruled by thieving dictators or because their financial markets are very small so it’s risky to have all the money in local unstable currency. The second is that if they convert their savings into local cash, they’ll push their exchange rate up and that will make their exports more expensive until they become uncompetitive (killing the golden goose).

So, they don’t let that happen. Instead, what all these Governments and Sovereign Wealth Funds (plus a few rich families and pensions) do is buy US Treasury Bonds. The US Treasury Bond market is seen as big and stable, open to anyone and underpinned by the rule of law.

And when I say big……$27 trillion……or for theatrical drama…… $27,000,000,000,000.

The outcome is that dollars, in the form of US Treasury Bonds, have become the backbone of the world’s piggy bank. And The Trump doesn’t like that. He sees the money being made by Governments around the world through the charging of tariffs that the US must pay for their imports. These profits are being converted to dollars and keeps the dollar exchange rate artificially high, which impacts US ability to sell their more expensive goods.

So, in The Trumps eyes there is only one thing for it……reciprocal tariffs. If you want to sell your product / service to the US and you are not a US company making the product / service in the US, then you will pay a tariff to do so.

The Trump announced the tariffs in a speech like a game show. What did your country win (or get away with)? He named it “Liberation Day” and 2 April 2025 will be studied by many generations to come. The UK got off lightly at 10%......China took a hit at 145%.

The financial markets hated it as the outcome of the tariffs was clear for the rest of the world……economic gloom likely to lead to recession……increased inflation……higher interest rates. It was no surprise that within a week The Trump reversed out of the tariffs by announcing a 90 day delay so he could figure out the mess he created.

And what a mess. Classic Trump.

April Fool’s Day just hasn’t got the same spark about it anymore. I blame The Trump……he acts like it’s April Fool’s Day every day.

The Numbers

In response to Liberation Day, the US stockmarket fell 10.5% over a 2 day period……the biggest fall for 5 years. Then when he reversed out of the tariffs with a 90 day delay, the index gained 9.5%......the third-largest one-day return since 1987.

Volatility that only The Trump can create. He really will test Americans threshold for pain this year.

What does this all mean for the UK?

More than £60 billion worth of British goods are exported to the US each year. The Trump’s tariffs threaten sectors from pharmaceuticals to whisky. Most of those exports are now going to be subject to a 10% tariff, although there will be some exemptions and some higher rates. The Trump published a list of more than 8,000 products that could be subject to retaliatory tariffs.

Predictions on the exact financial impact to the UK economy is not an exact science, given that The Trump is full of contradictions and throwing exemptions about for fun.

However, as little as a 0.6% reduction in GDP would wipe out Rachel Jane Reeves’s budget headroom and force her to find almost £18 billion worth of further savings or tax rises. Even a slender 0.2% reduction would result in a £6.2 billion hit to the economy,

The key sectors that will take the biggest hit are likely to be cars, pharmaceuticals, food and drink.

As a whole, US imports of vehicles amounted to $217 billion last year, 6.6% of all goods imported. The US is the UK’s second largest car export market (after the EU), with exports of more than 101,000 units in 2024, equating to £9 billion of cars. There is now a 25% tariff on UK car imports to the US, with up to 25,000 jobs at stake.

Pharmaceutical goods are one of Britain’s top exports to the US, with exports to the country worth £6.5 billion last year. GSK makes more than 50% of its sales in the US and AstraZeneca 40%.

Big figures and a likely big impact……unless we see further reversals from The Trump.

Talking of reversals……Elon Musk performed an amazing U-turn. Having literally been The Trumps ‘go to man’, he announced that he was standing down from Government responsibilities. Perhaps it had something to do with Tesla’s income falling by 39%......or Tesla shares falling by 37% this year. It appears to be expensive to be a friend of The Trump.

Another key measure of confidence in The Trump’s tariffs is the price of oil……with the price falling below $60 for the first time in more than 4 years during April.

As a little light relief, my favourite number this month was……11……the (not so) little lady turning 11 on her birthday!

Trump of the Month

There could only by one winner of the Trump of the Month award for April 2025……Donald John Trump.

To understand how out of touch he is on the reality of how products are made, the answer is probably in your pocket……the iPhone. Consider the journey of an iPhone microchip……the small wafer that powers the supercomputer in our back pockets (it is half the size of a 5p coin).

To make a microchip, white lumps of quartz are mined in Galicia, Spain, before being smelted in Berghausen, Germany. This “polysilicon” is then flown to Oregon, United States, where a Japanese company turns them into silicon wafers, before being shipped halfway round the world again to Taiwan.

There, arguably the most important company in the world (the Taiwan Semiconductor Manufacturing Company – TSMC) takes these wafers and, following designs from British-based, Japanese-owned Arm, etches semiconductors into them using a machine made exclusively in the Netherlands.

The chip then zips up to Malaysia for inspection and wiring. It then lands in Zhengzhou, China where workers for Taiwanese-owned Foxconn attach it to the rest of the phone. From mine to motherboard for just £35 a chip.

If the iPhone were swept up in the tariff war, the cost of the end product would double. There are about 150 million iPhone users in America, comprising almost 60% of the market (the UK is 45%). It is the indispensable consumer product (even The Trump uses one) that any President would do well to avoid doubling in price.

So there was only one action available to The Trump……to perform one of his customary U-turns……and exempted smartphones and semiconductor chips from the new tariffs.

It was a victory for Silicon Valley, proving the power it can exert on The Trump. It also demonstrated the limits of The Trump’s understanding, rhetoric and freedom to operate.

Two things can be true at the same time……US companies are still the best and most innovative in the world and there is no current alternative to Chinese manufacturing. Capitalism at the end of the day will prevail.

The Trump’s craziness has been taken to a whole new level……it’s almost admirable. Almost.

Trump Lunacy Rating: 10 / 10

 

And Finally……

“History never repeats itself; man always does."

Voltaire