Sunday, 19 February 2017

Oops Perhaps Retail Isn't Going To Save Us After All

We had early sales before Christmas, we had January sales and late sales allied to low interest rates and money being printed willy nilly by the Bank Of England and yet consumer spending fell in December and January. The fall in January was rather smaller than the fall in December and retail sales figures are one of the more volatile indicators when it comes to the economy so the next move could be up.

Personally I doubt it will be though; inflation is making a return as wage and pensions legislation comes into effect and as the effect of the weaker pound, which fell again today on the news of the retail sales figures, starts to bite. Brexit uncertainty must be playing on some peoples' minds, oil prices are on the up, as are business rates, raw material costs and so on.

It's not just consumers who are quiet, major stockbrokers report that investors are putting off decisions too.

What's the prospect then for the Bank Of England's predicted 2% growth forecast? Looks shaky to me, I have to say. The BOE has also expressed concerns about levels of personal and household debt, dare they encourage more debt, or do they try and rein in spending on credit? To do so would probably be to rein in spending full stop and if they need to raise interest rates in a few months, as I believe they may well have to, then there will be a howl of pain from the already indebted majority.

Mark Carney could be between a rock and a hard place although he's already talked about scooting back to Canada in the not too distant future. Some of us might like to scoot off to Europe but that door may close.

Liar in Chief Boris Johnson and Universal Credit genius IDS crow about how good things are, well of course the world didn't end that day after the referendum and of course the weaker pound meant a short term bounce for exports. Unfortunately we are sleep walking over a cliff and since Mrs May can hardly play the role of siren she's pushing hard from behind. Why might be a good question.

Saturday, 18 February 2017

Can Copeland Save Britain From Itself?

The Copeland By-Election is coming up shortly. It's been a safe Labour seat for as long as most people can remember. Theresa May (not my Prime Minister) smells an historic opportunity. A ruling party hasn't won a by-election since the eighties. Largely because we're a cantankerous lot who always kick the government when we think it doesn't matter. Unfortunately Brexit did matter.

Labour has no position on Europe, divided and leaderless they could just fall victim to Mrs May's nuclear industry strategy and her visits to local schools etc. It would be a miracle if the Lib Dems took the seat, but it would send a huge message that people have their worries about the Tories' headlong UKIP inspired dash towards Brexit.

Only the Lib Dems among the major parties are united over Europe now and only the Lib Dems have been united in their pro Europe, pro joined up thinking, pro co-operative world stance in the past. Only the Lib Dems know what a principled position is right now. Nick Clegg paid a huge electoral price for two things: One for joining the Tories in a coalition. Two for not bringing the government down, at a time of financial crisis, over tuition fees. He paid the price, in effect, for responsibly putting the country first.

Labour did not pay the price for introducing tuition fees in contravention of their own manifesto and the Tories did not pay an electoral price for raising them. If you want Liberal policies you have to vote Liberal. As for the coalition with the Tories, the sums did not add up to form a workable government with debt monger Brown, the destroyer of pensions and personally I feel any coalition should always include the party which got the highest number of votes. For others to push them out seems borderline undemocratic to me.

Strangely the coalition worked pretty well, as Clegg in particular tempered the worst excesses of the Tory right. And look at the mess we're in now that Cameron bought off the electorate with his complacent, well, stupid actually, referendum pledge which almost wiped the Liberals out.

We need the Lib Dems more than ever now, just look at the attack on liberal policies going on over the pond. Please Copeland, please show the way, do something brave and wise, vote Liberal to a man, woman and youth. Do it, shine a light in the darkness, I dare you. Stoke won't, it's up to you.

Friday, 17 February 2017

With Friends Like Blair Who Needs Enemies?

Tony Blair has urged the sixteen million one hundred and forty thousand plus voters who voted for a joined up co-operative Europe to rise up and fight Brexit. He has pointed out the deficiencies in his old party, maybe they still count him as one of their own, I'm not sure, couldn't care less actually, but he was right in almost everything he said.

Sadly, for we pro Europeans anyway, he's such a toxic messenger, such a hated figure, and the man who's primarily to blame for the migrant crisis which tipped so many voters over the edge, (who says fear controls people?) that he just cannot inspire anyone anymore, or ever again.

Yes, Theresa May, liar Boris, Gove and IDS etc are on a headlong rush over the precipice, yes a vast number of people cannot have known what they were voting for. Indeed since we don't know just what will happen, or just how disastrous the consequences will be, the argument could be made that even the most educated and informed Brexit voters were simply tossing a pebble into a black, icy pool to see just what monster arose.

He was even right that Brexit may not be unstoppable and that people have a right to change their minds when they avert their eyes from Boris Johnson's hypnotic gaze and look around themselves at the world.

Blair will fail to inspire Labour, they've lost it with him and they're so divided over Europe that no leader will paper over that crack. He's muddying the waters and failing to help, indeed just his presence as a pro European on the stage will inspire the Brexit battalions to derision. Blair's motive? Crawl back into the limelight I suppose, like a downward sliding celebrity eating insects in the jungle to try and hold on to the slippery pole a moment longer.

Blair is yesterday's monster, May is today's monster. If the sixteen million one hundred and forty thousand plus Remain voters rose up and joined, or at least supported the Liberal party, then maybe we'd get some liberal, common sense, middle ground policies from a party that knows where it stands and still has some real values.

If he actually wanted to do some good it's a shame Blair doesn't give his money to the Lib Dems and pull his head back in, instead of spending it on a doomed and ultimately humiliating attempt at a political comeback.

Thursday, 16 February 2017

Our Old Friend Inflation Is Peeking And Peaking Round The Corner

UK inflation is now at 1.8%, just below the governments target that it should remain below 2%. Nothing to worry about then. Except that raw materials costs for UK manufacturers are up by about one fifth and they can't absorb it all forever. Oil prices are rising once again, but that will be exacerbated by the weaker pound as well; the cost of transportation of goods is well on the rise and that means the goods themselves will cost more when they arrive. Not to mention the rising prices for imported finished products due to the exchange rate.

Many businesses are facing rising business rates. Local authorities aren't always peopled by the brightest of souls. The huge and inexorably rising national debt means they are trying to squeeze money every which way and from everyone; one has some sympathy, the debt means no government money to speak of, but plenty of governmental obligations in terms of things they have to provide.

Nonetheless if their council tax payers go bust then they and everyone else is worse off. So bright ideas like increasing business rates for shop keepers at the same time as putting parking restrictions in place to drive them out of business in the hope a few more pennies will drop into local authority car parks is the kind of genius we've come to expect.

Anyhow, back to inflation, the minimum wage will rise in April but many businesses are actually trying to pay the living wage or higher, they will also have to support the workplace pension. Women who've lost six years worth or more of state pension and people like myself who invested in private pensions, only to see Gordon Brown destroy them will know all about trusting the government regarding pensions, but as regards inflation it's just another cost businesses have to face and WILL pass on.

The media tells us that the consumer has kept the economy buoyant post the ridiculous and foolhardy referendum vote. That's because the Bank of England has flooded the country with new paper money and kept interest rates artificially low so that people who never experienced mortgage rates in double figures can get into debt, way over their heads.

Now, with so many people in debt, the bank must be terrified of raising rates, but eventually they will have to, with all the upward pressure on prices, raw materials costs, transportation costs, wage and pension costs, business rates, expect to see that 2% inflation target lost within months and that's without the two years worth of volatility during the so called negotiations.

If you're a Brexit voter living on credit, then well done you!

You can express sympathy with this view here if you like!