Well it wasn't the best of starts and then it got worse in the middle and lets not even talk about the end but Liz Truss is out but she leaves Office a record breaker.
With 44 Days in Downing Street, of the 56 Prime Ministers she is the shortest serving, beating George Canning's 119 days in office although he arguably had a better excuse as he died of tuberculosis.
Straight faced some MP's are asking for Boris Johnson to come back, if Johnson is the answer, it's a very silly question as that's the same Boris they removed two months ago after his multiple lying and sleaze scandals and a contender for the worst PM in history until Truss came along but the favourite is Rishi Sunak although he was rejected by the Conservative Members in favour of Truss (not white enough for them) and Penny Mourdant who was rejected by her own MP's in the last coronation so neither are a good fit.
As the Government are facing being decimated in a General Election, letting us pick our own leader is highly unlikely, as one MP brilliantly put it, going to the country wouldn't just be Turkeys voting for Christmas, it would be them also basting themselves and turning the oven on.
Unfortunately, after the 44 days she was in charge, she has left a legacy of everyone being poorer but at least the guy who gets to haul the podium out into Downign Street is being kept busy.
Thursday 20 October 2022
Downing Street Podium Makes Another Appearance
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4 comments:
The same people that defend massive deficit spending and money printing as the solution to UK economic problems blame the Truss deficit-increasing budget. How ironic.
It wasn’t just a problem in the UK. The euro, yen, krone, and most emerging market currencies had like like problems versus the dollar. What about bonds? It is the worst year since 1931 globally. The collapse in prices of sovereign and private bonds other economies is much like UK fixed income equivalents.
The leftist economists that say deficits are okay and that nations can spend and print money as they please, now say that a UK Keynesian budget, but with tax cuts, will kill the economy - god forbid you reduce the cost of government.
British pension funds are not selling sovereign bonds because they don’t trust any another government’s budget. So, they are selling their negative-yielding sovereign bonds (that they jumped into created by falsely cheap money believing central banks would keep fixed income prices elevated with constant repurchases – which was foolish at best and perhaps corrupt and self-serving at worst.
British pensions with unfunded liabilities are not a problem caused by the Truss budget. It was an enormous problem in 2019–20 disguised by stupid currency printing.
What happened with years of negative rates and currency printing? Pension funds used liability-driven investing (LDI) strategies with derivatives to hedge inflation and interest rate risk. As interest rates increased, the notional value of derivatives in LDIs fell. So, you get increased collateral calls. Thus, rising rates mean pension plans have had to liquidate portfolios to meet collateral calls... bad.
Truss didn’t cause this insanity. The blame belongs to negative real rates and huge liquidity injections by the Bank of England. UK pension funds need to get rid of the liquid assets they own as margin calls rise. Inflation arrived after years of massive money printing and debt monetization and investment funds all over the world, but especially in the euro area, UK, and Japan. They are now having melt downs with massive nominal and real losses. When margin calls kick in, many must sell their liquid assets, Gilts, or government bonds.
Truss is not at fault for the insanity of Sunak’s ultra-Keynesian budgets. She is to blame for believing more Keynesian deficit insanity would work.
Truss is not to blame for twenty years of monetary insanity and fiscal irresponsibility. She is to blame for a budget that increases spending without cutting unnecessary expenses.
The irony is that the defenders of huge deficits and borrowing (the left) causing bigger government feel vindicated – they blame evil tax cuts.
Typical of the left and biased, ignorant, press.
Funnily enough that’s exactly what I said this afternoon
what did you say, that Keynesian economics and growing government caused the current economic problem, or that the problem is due to the "evil tax cuts"?
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