There are about 8 billion people in the world. To add to the drama, that’s 8,000,000,000. If an event has a one-in-a-million chance of occurring every day, it should happen to 8,000 people a day……or 2.9 million times a year……or 250,000,000 times during your lifetime.
That’s the maths of it.
Even a one-in-a-billion event will become the
fate of hundreds of thousands of people during your lifetime. And given the
news media’s insatiable appetite for shocking headlines, the odds are nearly 100%
that you will hear about these events when they happen. Probably within
seconds.
In a normal person’s life, miracles should
occur at the rate of about one per month. The basic law of maths dictates this.
The idea that incredible things happen because
of boring maths statistics is important because it’s the same for terrible
things too. Think about ‘one hundred year’ events……floods, hurricanes,
earthquakes, financial crises, frauds, pandemics, political meltdowns, economic
recessions, etc.
A ‘one hundred year’ event doesn’t mean it
happens every one hundred years……it means there is a 1% chance of it occurring
in any given year. That seems low……but when there are hundreds of different
independent ‘one hundred year’ events. What are the odds that one of them will
occur in a given year? Actually, pretty damn good.
But it’s always been like that.
The difference now is the size of the global
economy……as this increases the size of potential crazy things that might happen
increases. When 8 billion people interact, the odds of a fraudster, a
genius, a terrorist, an idiot, an expert or a visionary moving the needle in a
significant way on any given day is nearly guaranteed.
And then throw in the other major
difference……the immediacy of news. News used to be far harder to disseminate
over distances and what was going on in other parts of the world wasn’t always
a top concern. Now the news gives us every last detail of every nation,
culture, political regime and economy in the world……within seconds.
There are so many good things that come from
that. But we shouldn’t be surprised if the world feels historically broken in
recent years and will continue that way going forwards.
That’s a very long winded way of saying, the
world isn’t broken. It’s always been this way. We just now see more of the bad /
crazy stuff that’s always happened because the world is more connected now.
So the next time a world leader suggests
drinking bleach is a good way to get rid of a pandemic, remember that craziness
in world leaders has always been there……we now just watch it live.
I do love a number.
The Numbers
It’s been a month of mild chaos, medium outrage
and maximum disbelief. October arrived like a soggy biscuit……unexpectedly limp
but somehow still capable of causing a choking hazard.
The choking hazard in this case is the
impending Budget. Rachel Reeves will play the economic game of Jenga……remove
one tax-block, add another spending-block, the tower wobbles and you hope the
whole thing doesn’t collapse mid-session.
Brexit is the villain, not the immigration
wave, savage lockdowns, stubborn MPs turning down deals or the Trussonomics
earth tremor. Reeves certainly doesn’t blame the damage her own 2024 Budget did
to business or Keir’s panicked U-turn over welfare cuts. Big, bad Brexit
carries the can……because that’s Troy territory.
Regardless of the ‘latest’ reason, the figures
before the Budget look dreadful.
The most recent monthly figures highlighted
that the Government borrowed £20.2 billion, the highest comparable in 5
years. In the last 6 months, the deficit hit £100 billion.
As a consequence, the monthly interest payments
hit £9.7 billion, £3.9 billion more than a year before.
The message is pretty clear……the cost of
financing the Government’s debt is eating into the Budget, leaving less room
for discretionary spending or fancy policy experiments. All eyes are now on the
26th November at 12:30pm.
There is no doubt that the economic / political
uncertainty is now filtering into the housing market. Sales of new build homes
have sunk to lows not seen since the global financial crisis more than 15
years ago (even lower than sales registered during the pandemic).
An average of 0.3 homes are being sold
weekly per outlet (a standard industry metric) across the UK. The equivalent
average sales rate reported by the big housebuilders at the bottom of the
market in 2007-8 was 0.4 sales per outlet per week and the long-term
norm in the 2010’s was about 0.7.
The plunge in sales this summer makes it hard
to see how the Government can reach its target to deliver 1.5 million
homes in England over the five years to March 2029.
The most bizarre story this month was linked to
a unit tasked with investigating more than £1 billion of suspected fraud
on taxpayer-backed pandemic business loans. The National Investigation Service
(Natis) received £38.5 million from taxpayers to investigate widespread
abuse of the bounce-back loan scheme……but an investigation by state auditors highlighted
they were only able to verify £7.2 million of recoveries “directly
attributed to active investigations by Natis”.
So let me get this right……we paid £38.5
million to recover £7.2 million. Oh, so that’s why the Natis unit
was closed so abruptly! You could laugh if it wasn’t so close to home!
According to official estimates, at least £1.9
billion of pandemic loans have been flagged as suspected fraud, most of which
is on the £47 billion bounce-back loan programme. Although banks
provided the credit, the debt was underwritten by a 100% state
guarantee.
The other most bizarre story of the month
centred on Amazon causing an outage on its web services (AWS). In short, the world’s
largest cloud computing system hit more than 1,000 websites and apps. A
pretty big deal when you consider that this included NHS services, Government
Gateway and HM Revenue & Customs (in addition to a huge part of the banking
sector).
In recent years UK regulators have turned their
attention to AWS, which commands around 40% of the UK cloud market.
Perhaps Jeff Bezos is a bigger deal than just delivering the latest book of
choice.
Despite the gloom, there are some flickers of
light in the fog……but you have to go searching. A recent survey (the
purchasing-managers index……in my top 5 of all indices) suggested a modest
uptick in business growth (from 50.0 to 51.1). In addition, the
International Monetary Fund (IMF) says the UK will be the
second-fastest-growing G7 economy in 2025. Impressive……well, until you zoom out and realise that being
second fastest in a slow race still means you’re not exactly lapping anyone.
Rare earths are used in MRI machines, petrol, diesel
and electric vehicles, smartphones, computers and in the defence sector (F-35
fighter jets, submarines and radar systems).
China mines about 70% of the world’s
rare earths and refines about 90%, creating a stranglehold on supply.
In response, The Trump imposed a (insert the
latest made up figure) % increase in trade tariffs on China. Mainly because
he can (that’s what he does) but also out of fear of China strangling the world
of rare earths. This story will rumble on as a truce has apparently been
reached……or not reached….depending on the direction of the wind.
Elsewhere, Tesla boss Elon Musk has become the
first person ever to achieve a net worth of more than $500 billion (a half-trillionaire)……further
cementing his status as the world's richest person (Larry Ellison is the
world's second richest person with a fortune of about $350 billion).
We seem to talk about ‘billions’ without any
real context for the scale. It’s almost a mythical number. This may help for
context……
A billion seconds ago……it was 1960.
A billion minutes ago……Jesus was alive.
A billion hours ago……our ancestors were living
in the Stone Age.
And my favourite number of the month was……31……for all sorts of spooky reasons.
Trump of the Month
A month of many options, given the rich
abundance of madness before us.
Bobby has caused quite a few ripples this month
with his comments on a visit to Birmingham. The Tory MP was shocked by the poor
housing conditions……“I went to Handsworth in Birmingham and it was absolutely
appalling. It’s as close as I’ve come to a slum in this country and I didn’t
see another white face.” For context, Bobby owns two £2 million homes in
London and a £1 million manor house in Herefordshire.
Exactly what does the colour of skin have to do
with housing conditions? Is the “slum’ not the result of his party’s 14
years in power? Absolutely crazy.
A record £1 billion has been spent this year
to switch off wind turbines because of flaws in the UK’s drive for net zero.
To emphasise the madness……in a single day (1st
October) Britain’s electricity operator paid wind farm operators £1.3
million in compensation for lost revenue after ordering them to switch off
turbines to avoid overloading the grid. At the same time the grid operator was
forced to pay £4.9 million to buy energy from abroad and switch on more
expensive gas power generation to meet demand. The total amount of lost energy
was enough to power the whole of London for a day.
Who is responsible for this mess……the
Department for Energy Security & Net Zero……lead by Ed Miliband…..who is
nowhere to be seen on this topic.
We shouldn’t be surprised, Miliband and madness
go hand in hand.
Candidate #3: Keir Rodney Starmer
Lindsay Whittle, for Plaid Cymru, won the
Caerphilly by-election with more than 47% of the vote. It marked
Labour’s first defeat in the area for 100 years as they secured 11%
of the vote……with Reform coming second with 36%. 100 years!
Nigel Farage said next year’s Welsh elections
would be a “two-horse race between Reform UK and Plaid Cymru”. It is hard not
to agree (through gritted teeth!).
It was a remarkably bad performance by Labour
on what has been regarded as one of their safest seats. Even long-standing
dominance is not safe when the party leader has an approval rating of just 21%.
Keir was "deeply disappointed" and “clearly
we need to do much more." Which begs the question……why aren’t you? Utter
madness.
Some very worthy performances for Trump of the
Month……but it had to absolutely go to Candidate #4: Alexander Boris
de Pfeffel Johnson.
Amongst the usual guff, stuttering and smoke
screens, BoJo’s testimony did acknowledge mistakes but he defended his decisions
over school closures and exam chaos. He admitted children paid a “huge price”
during the pandemic and he “under-estimated the scale and pace of the
challenge”. No kidding.
Interestingly, the inquiry highlighted missing
messages……5,000 WhatsApp messages from critical early months were
reportedly missing from BoJo’s phone……which he denied removing as it was a “phone
issue” ……adding a farcical dimension to the inquiry proceedings.
He also claimed he was “bamboozled by the
graphs” and struggled to get his head around statistical briefings.
Documents shown to the inquiry revealed he
allegedly asked whether people could kill Covid by “blowing a hair-dryer up
their nose” after he watched a YouTube video.
Internal documents also show a comment of “why
are we destroying everything for people who will die anyway soon?” and “Covid
is just nature’s way of dealing with old people.” Wow.
The tone of his testimony was part contrition,
part deflection and part performance……with an agricultural sized dollop of
craziness thrown in.
The two main criticisms of BoJo are that he is
a) dishonest and b) lazy. It was arguably uncharacteristically diligent of him
to have provided such clear evidence of both within the first 30 seconds of the
inquiry.
How on earth did we endure BoJo as Prime
Minister for 3 years?
Perhaps we are the mad ones.
Trump Lunacy Rating: 10 / 10
And Finally……
“Politics is the art of looking for
trouble, finding it everywhere, diagnosing it incorrectly and applying the
wrong remedies.”
Groucho Marx
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