The Month That Was……October 2023

October offered up a Friday the 13^th. You know the drill……don’t walk under ladders, avoid black cats, etc. I always thought it was a load of rubbish……until this one.

My day started badly. Very badly. I brewed the perfect cuppa, only to find there was no milk left. So I popped to the local shop (trip 1) in the rain and got soaked. Brilliant.

I got home, made another brew and the tea bag split before dropping my toast butter side down. Arghhhh. I then ran out of toilet roll at a crucial moment. So I popped to the local shop (trip 2) in the rain and got soaked (again).

I’m a fully grown competent human being so I used the self-checkout. “Unexpected item in bagging area, please remove”.  But I just……I just scanned it! WHAT DO YOU MEAN? Enter Brenda from stage right to rescue the competent human being.

I decided to treat myself to a cheeky mid-morning biscuit with my tea as a pick me up……of course the wheat weakling collapsed into the cup and my attempt at a daring rescue mission failed miserably. Day ruined. 

Then the day’s task of drafting an important letter was rudely delayed by the lack of a postage stamp. Exactly who in their right mind allows the stamp hoard to run dry? Who is responsible and can take blame for my clerical oversight? It can’t be me surely? Trip 3 to the local shop (and the third drenching of the day) to queue for 15 minutes to post one letter. Well, when I say post……Sandra behind the counter seemed overly keen to inform me that she was due a break as I got to the front and that she would be closed for 20 minutes.

Death by a thousand cuts and it was only 11:00am. Maybe there was something in this whole Friday the 13^th malarky. So there was only one thing for it……detailed and in depth research (Google) to get to the bottom of this.   

The association with bad luck starts with the number 13. In Abrahamic religions, 12 is seen as a number representing perfection and completion; there are 12 disciples of Jesus Christ, Abraham has 12 sons, there are 12 tribes of Israel. The number 13 is therefore symbolically considered imperfect. At the Last Supper of Jesus Christ, Judas Iscariot, Christ’s betrayer, was the 13th guest.

The association with Friday is also linked to Judas Iscariot, betraying Christ on Maundy Thursday leading to his execution on Good Friday.

These ideas percolated for hundreds of years, growing stronger and more influential as the centuries pass, until we reach modern day. I knew there had to be a logical reason why this clumsy, ham fisted (semi) competent man was having ‘one of those days’.  

So I’m now off to my GP to discuss my self-diagnosed condition of Friggatriskaidekaphobia (the fear of Friday the 13^th). There’s got to be some tablets for that……surely?

The Numbers

The International Monetary Fund (IMF) gave some pre-Halloween fright with its announcement that it has slashed the forecast for UK economic growth. The IMF puts Britain at the bottom of the G7 league table for 2024. In its latest health check, the IMF lowered the UK’s projected growth rate from 1% in 2024 to 0.6%.

Canada, France, Germany, Italy, Japan, the United Kingdom and the United States make up the G7 and account for 50% of global net wealth. Being bottom of that table is quite an achievement given the recession-hit countries in the Eurozone.

The UK has suffered from prolonged high inflation compared with the United States and the Eurozone since 2022, owing to the economy’s delicate exposure to market energy prices. The IMF expects inflation to average 7.7% this year, one of the highest in the developed world. It is predicting this will fall to an average of 3.7% per cent in 2024, still well above the Bank of England’s 2% target.

Persistent inflation will mean the Bank of England will need to keep interest rates higher for longer than any other big central bank. Clearly not the right ingredients for economic growth.

And those higher interest rates are a problem for the Tories……a pre-election tax cut sweetener looks unlikely. Jez Hunt will warn that the economic outlook accompanying his autumn statement on 22^nd November is likely to show £30 billion in additional debt interest payments due to high borrowing costs (compared with March forecasts). And that was meant to be the cash for the tax giveaway!

The interest the Government pays on national debt has now reached a 20-year high and the balance stands at £2.59 trillion.

The timing of the latest position on Covid business loans was not ideal to add to the above. Around £11 billion of taxpayer-backed pandemic business loans are in arrears or default. The Government has paid £6.2 billion to banks that were underwritten by the state (i.e. us!). It is not a situation that is going to improve if we have to live with higher interest rates for longer.

This month’s most important number was always going to be 31 and Halloween! 

Trump of the Month

There were plenty of worthy considerations this month but the Trump of the Month award is fully deserving and goes to……Conservative Party.

It was their party conference this month and a real chance to ignite voters with forward thinking politics ready for the General Election. Instead we were treated to:

- Liz Truss smiling away and wanting another go at implementing her cartoon version of economics. And just to absolutely enforce she is as barmy as The Trump, she announced the slogan….. “Make Britain Grow Again”.

- Then Nigel Farage turned up for the usual self-promotion and then to support Liz Truss with any time leftover.

- Suella Braverman was next up and was heckled during her speech……before stepping on the tail of a guide dog wearing high heels (Suella not the dog). 

- Theresa May attended for the first time since 2018 and conducted a signing of her book.

- Iain Duncan Smith handed Rishi a list of 100 changes to make Brexit great (only 100!).

And then there was the main event……

- Rishi used the northern location of the conference (Manchester) to announce the cancellation of the northern section of HS2 due to costs. Even the dumber members of the Tories would realise that the timing and location might not be ideal……surely?   

And that is all the party conference will be remembered for, which is truly astonishing.

Whilst the opposition does not look ready for power yet, there is a national mood shift and the tired Tories are on the wrong side of it.

Trump Lunacy Rating: 10 / 10

And Finally……

“It is better to offer no excuse than a bad one.”

George Washington

The Month That Was……September 2023

Whether you realise it or not, the political shuffling for the General Election has started……especially if you are an older voter.

There is key context to Rishi’s recent behaviour……in 2019 the Conservatives vote share among the over-65s was more than 60%. Such is the extent of the divide between how the old and the young vote, age has become more important than class. There are over 11 million people over the age of 65 for Rishi to now flirt with……and he’s had his best lippie on this month. 

It started with the ‘triple lock’ this month, which pins the annual increase in the State Pension to whichever is the greatest of average earnings growth, inflation, or 2.5 per cent. The ‘whichever the greater figure’ in September each year wins the race and is applied the following April. September’s figure last year saw a 10% increase and it will now rise by a further 7.8% in April given this month’s figure (earnings growth won this year).

This is obviously good news for those retired, but difficult to justify politically in the wider economic context given the Government’s reluctance to raise civil servant pay and trying to tackle inflation / cost of living. So what does Rishi do……contest the 8% to a lower figure……or honour the triple lock?

Easy……look after the 60% and nurture the voters for next year.

When considering the 60% context, it will come as no surprise that there is strong consideration at No 10 among senior figures about abolishing inheritance tax as the headline tax giveaway next year as a pre-election sweetener.

50% of the population thinks that it is an unfair tax and 31% think that they have sufficient assets to have to pay inheritance tax (source: Institute for Fiscal Studies). Yet the reality is that only 4% of UK deaths a year result in an inheritance tax charge.

Given that Inheritance Tax brings in only £7 billion a year to the Government, it is a pretty cheap way to appeal to the 60%.

There is absolutely no doubt that Rishi is governing the country to appeal to voters rather than what is right and proper. Make no mistake……the General Election has definitely started.

 

The Numbers

Andrew Bailey, the Governor of the Bank of England, cast significant doubt this month on the need for further interest rate rises as “peak interest rates have been reached”. He also added that the Bank of England is “through with lifting interest rates” and stressed inflation was on course for a “marked” decline.

So there. It’s official. Apparently.

It won’t surprise you that there is some suspicion out there on such bold statements given the recent history of his lack of foresight on inflation, interest rate rises and the length of the pain caused by both.

Bailey at least got one month correct as interest rates were held at 5.25% as the Bank of England voted 5-4 to keep borrowing costs unchanged. It was the first time interest rates remained the same since November 2021 after 14 straight increases.

All eyes will be on 18^th October for the next instalment of the inflation game. The latest inflation figure of 6.7% suggests the direction of travel is down……just not a quick enough journey though!  

The key statistic of the month showed that average earnings across the economy rose by 7.8%, the highest pace of wage growth recorded in 22 years. It is very difficult to see how inflation can be brought down to 2% when wages are growing by nearly four times this. It makes the prediction of interest rates peaking seem premature.

And that 7.8% will be painful for the Government as September’s measure of the ‘triple lock’ is what the State Pension will now rise by in April……an increase in cost of £11 billion.

The impact of higher interest rates is being felt by UK private sector businesses as the composite Purchasing Managers’ Index (my clear favourite of all of the indices……it’s a cracker) fell from 50.8 to 47.9. This was the worst performance since January 2021 and a below 50 score separates growth from contraction. The downturn hit the services industry hardest and raised the risk of a recession.

Given the level of interest rates, it is perhaps no surprise this month that house prices saw the biggest yearly decline since 2009 at 5.3% lower compared to last year.

And the month also saw the little lady return to school and a new adventure in Year 5. 

Trump of the Month

For the second month in a row, nothing has come close to the absolute absurdity and sheer lunacy of this man’s body of work. September 2023’s Trump of The Month could only be……The Trump

In addition to facing 91 criminal charges for basically acting like a ‘wrong un’ over recent times (see August’s blog), he is also facing civil legal action on the grounds of committing fraud over many years. He essentially inflated the value of his real estate empire to gain preferential terms on insurance and loans.

In one example, The Trump claimed his apartment in Trump Tower was 30,000 square feet. In fact, it is 11,000 square feet. “A discrepancy of this order of magnitude, by a real estate developer sizing up his own living space of decades, can only be considered fraud,” the judge wrote.

The judge ruled this month that the case of defrauding banks and insurers is likely to see The Trump lose the $250 million lawsuit and his licences to trade in New York.

Did The Trump try to argue his case tactfully? Perhaps meet the accusers half way? Come clean and admit to fraud? Not a chance……he took to social media to exclaim:

“It is a POLITICALLY MOTIVATED WITCH HUNT by a Racist Attorney General, and a Deranged, Trump Hating Judge. It is ELECTION INTERFERENCE at a level never seen before.”

Even by The Trumps standards, that’s quite a response. But here’s the thing……The Trump is still red hot favourite to win the Presidential Election next year. The latest poll puts The Trump ahead of Joe B among registered voters by 52% to 42%. A ten point lead!

I scratch my head at The Trump being considered the best candidate amongst a population of 330 million to lead the most powerful country in the world.    

We are walking eyes wide open into another four years of this. All of this would be fascinating and funny if it wasn’t true.

Good luck everyone.

Trump Lunacy Rating: 10 / 10

 

And Finally……

“It is better to offer no excuse than a bad one.”

George Washington