Hear hear! I was so relieved to read of “operation rampdown” the other day. Let’s hope it happens or even happens earlier than March and that other countries like poor benighted Ireland see Britain acting rationally and reaping the rewards of a return to normality
Why not tomorrow, or even tonight? What’s the point of waiting?
Graham Stull
2 years ago
This is a very sensible piece.
The first thing to do, I would say, is repudiate the failed politics of lockdown-ism and COVID hysteria, publicly and for good. Not only would this send a strong signal to those who continue to militate in this direction that they should hang up their facemasks for good, it would reassure businesses and investors that Britain will not slip down this rabbit hole again.
A second step is to refocus on stabilising supply chains: Sensible worker migration policies (the EU’s freedom of movement provisions were just that, btw), streamlining and facilitating a regulatory approach that stimulates a return to Britain’s productive capacity. And finally (though it will not be popular) frontloading some of the necessary fiscal consolidation to dampen demand-side inflation and sow the seeds for a quicker return to a recovery – one led by strong fundamentals.
“The beatings will continue until morale improves.”
“A second step is to refocus on stabilising supply chains:”
USA buys 80$ Billion more than it sells internationally A MONTH! (USA is doing $120 Billion QE A MONTH, and a trade deficit of $80 Billion A MONTH on top, and printing Trillions in ‘human infrastructure, and Trillions in the regular Fed Budget deficit as well) I do not know the British numbers, but they are likely very frightening.
So how will supply chains work in the year or two it is projected it will take to fix the supply issues? Will the Chinese still want foreign Central Bank Fiat Currency in exchange for their resources, work, and industry? Will supply diminish, and that be how it is fixed?
My guess is supply chains will be less stressed as foreigners want $ and Euros and Pounds less, as they are devalued more every day, inflated away – as $ are mere printed debt, piled on debt, with yet more debt issued to pay the interest on the debt –
Matthew Powell
2 years ago
I suspect that inflation is the medicine we are going to have to take to drain the vast amounts of cash pumped into the system during lockdowns. Yes some of this has once again found its way into the grossly inflated assets like property and the stock market but with the supply side shock of the pandemic, prices will inevitably rise.
I don’t expect the BoE to come riding to the rescue. With businesses and the government sat upon mountains of debt, charging higher interest rates would likely be even more harmful than inflation. Once the debts have been paid down and the economy has stabilised, interest rates may be able to normalised. Until then, we may be in for a rough ride.
Unicorn economics then? They going to pay the debt?
Inflation is a TAX, and an exceedingly regressive one as it taxes cash, pay, and savings. The wealthy have ‘Appreciating Assets’ instead of cash $ so are not hit by inflation – as well as they have intentionally big debt at low interest so that is inflated away so they get the asset they borrowed against cheap, win-win for them.
The Gov, via the incestuous relationship between the Central Bank and Treasury (an amazing story – look it up, how it works) causes money to be created by printing, this is spent out, this increases the money circulating, therefore inflation. Prices do Not Rise, the currency Devalues. If you double the amount of $ and keep the amount of goods and services constant, then prices inflate. BUT in this insane covid reaction the amount of Goods and Services were drastically Decreased as well. People sat at home being paid and not producing. That is also very inflationary.
SO what the deal is the Gov Debt can NEVER be repaid by tax, already every Western country was deficit spending during the good times, before the Trillions were added on, and the economy wrecked by lockdowns. Therefore it is to be Inflated Away – but it is really paid back by the stealth tax of inflation, as it sucks in all your savings, pension pot, income (which will never rise along with inflation, always lag, and FIXED incomes do not rise at all)
Then NO Interest for your savings and bonds to cover inflation – you are scre wed!
“I suspect that inflation is the medicine we are going to have to take to drain the vast amounts of cash pumped into the system during lockdowns.”
YES You Are. You have just been robbed by gov, they doubled the wealth of all the very wealthy in the last 18 Months by printing money for them to harvest! Now YOU are to pay it back by Tax Called inflation. Suck it up Bit *hes! You now have to pay for the trillions of $ the very rich just got given by the Government in the name of ‘Health’, although it did nothing of the sort – Lockdowns causing many times more harm than good, but it was a good excuse to make the filthy rich filthier, and the middle class and working poorer – just wait, the markets – super inflated values, as you point out, are poised to crash, taking you with them, but do not worry – the super Rich see it coming and have it all hedged, so will be fine…..
Hear hear! I was so relieved to read of “operation rampdown” the other day. Let’s hope it happens or even happens earlier than March and that other countries like poor benighted Ireland see Britain acting rationally and reaping the rewards of a return to normality
Why not tomorrow, or even tonight? What’s the point of waiting?
This is a very sensible piece.
The first thing to do, I would say, is repudiate the failed politics of lockdown-ism and COVID hysteria, publicly and for good. Not only would this send a strong signal to those who continue to militate in this direction that they should hang up their facemasks for good, it would reassure businesses and investors that Britain will not slip down this rabbit hole again.
A second step is to refocus on stabilising supply chains: Sensible worker migration policies (the EU’s freedom of movement provisions were just that, btw), streamlining and facilitating a regulatory approach that stimulates a return to Britain’s productive capacity. And finally (though it will not be popular) frontloading some of the necessary fiscal consolidation to dampen demand-side inflation and sow the seeds for a quicker return to a recovery – one led by strong fundamentals.
“Rampdowns” is just a short way of saying:
“The beatings will continue until morale improves.”
“A second step is to refocus on stabilising supply chains:”
USA buys 80$ Billion more than it sells internationally A MONTH! (USA is doing $120 Billion QE A MONTH, and a trade deficit of $80 Billion A MONTH on top, and printing Trillions in ‘human infrastructure, and Trillions in the regular Fed Budget deficit as well) I do not know the British numbers, but they are likely very frightening.
So how will supply chains work in the year or two it is projected it will take to fix the supply issues? Will the Chinese still want foreign Central Bank Fiat Currency in exchange for their resources, work, and industry? Will supply diminish, and that be how it is fixed?
My guess is supply chains will be less stressed as foreigners want $ and Euros and Pounds less, as they are devalued more every day, inflated away – as $ are mere printed debt, piled on debt, with yet more debt issued to pay the interest on the debt –
I suspect that inflation is the medicine we are going to have to take to drain the vast amounts of cash pumped into the system during lockdowns. Yes some of this has once again found its way into the grossly inflated assets like property and the stock market but with the supply side shock of the pandemic, prices will inevitably rise.
I don’t expect the BoE to come riding to the rescue. With businesses and the government sat upon mountains of debt, charging higher interest rates would likely be even more harmful than inflation. Once the debts have been paid down and the economy has stabilised, interest rates may be able to normalised. Until then, we may be in for a rough ride.
Unicorn economics then? They going to pay the debt?
Inflation is a TAX, and an exceedingly regressive one as it taxes cash, pay, and savings. The wealthy have ‘Appreciating Assets’ instead of cash $ so are not hit by inflation – as well as they have intentionally big debt at low interest so that is inflated away so they get the asset they borrowed against cheap, win-win for them.
The Gov, via the incestuous relationship between the Central Bank and Treasury (an amazing story – look it up, how it works) causes money to be created by printing, this is spent out, this increases the money circulating, therefore inflation. Prices do Not Rise, the currency Devalues. If you double the amount of $ and keep the amount of goods and services constant, then prices inflate. BUT in this insane covid reaction the amount of Goods and Services were drastically Decreased as well. People sat at home being paid and not producing. That is also very inflationary.
SO what the deal is the Gov Debt can NEVER be repaid by tax, already every Western country was deficit spending during the good times, before the Trillions were added on, and the economy wrecked by lockdowns. Therefore it is to be Inflated Away – but it is really paid back by the stealth tax of inflation, as it sucks in all your savings, pension pot, income (which will never rise along with inflation, always lag, and FIXED incomes do not rise at all)
Then NO Interest for your savings and bonds to cover inflation – you are scre wed!
“I suspect that inflation is the medicine we are going to have to take to drain the vast amounts of cash pumped into the system during lockdowns.”
YES You Are. You have just been robbed by gov, they doubled the wealth of all the very wealthy in the last 18 Months by printing money for them to harvest! Now YOU are to pay it back by Tax Called inflation. Suck it up Bit *hes! You now have to pay for the trillions of $ the very rich just got given by the Government in the name of ‘Health’, although it did nothing of the sort – Lockdowns causing many times more harm than good, but it was a good excuse to make the filthy rich filthier, and the middle class and working poorer – just wait, the markets – super inflated values, as you point out, are poised to crash, taking you with them, but do not worry – the super Rich see it coming and have it all hedged, so will be fine…..