swap, twist or spin?

I often drive past a huge advert on the M4 near the North Circular off-ramp which says something like 'Been mis-sold SWAPS? Phone this number'. It's been there for quite a while and another sign of the times.

Wide boys in the city create ostensibly fixed rate business loans but then embed derivatives to hedge their position. It's another round of sharp practice and some big name banks have been implicated.

And I'm expecting the next few months to be full of politico mis-selling as we hit the election on-ramp.

According to Parliament.uk, I see the UK national debt is up at around £1.48 trillion, with £48.1bn in interest per year. That’s without adding in the extra bit for the part government owned banks.

This debt is about 80% of GDP, or about £25k per person.

Now between, say, the mid 80s and around 2009 the debt was in the 40%-50% range, but since 2009-ish it has risen steeply every year and looks set to continue at least until 2016/17. Not my figures, they are from the Office of National Statistics and the Office for Budget Responsibility.


So despite any pandering give-backs before the election, it's highly likely we’ll see another taxation rise after the election. Nothing new there, according to the Institute for Fiscal Studies, each of the last six new elected governments have announced net tax rises, which average £7.5 bn per annum.

That's unless we go back to printing money, I suppose, like the £375bn that the Bank of England electronically issued during UK quantitative since 2009. Instead of channelling the money into public schemes like, say the NHS and schools, it shunted the money directly into gilts, consequently driving bonds and equities.

And guess what?

The richest few percentage of share owners own 40% of all the shares and saw them rise 20%. They liked this and invested even more in upwardly mobile shares. Not in trickle-down spending. Okay, maybe some champagne and caviar. The banks could use their quantitively eased books to create more twisted financial instruments aimed towards those from whom they could make quick bonuses.

As for where the gap gets hidden. As gilt yields fall, so do pension annuity prospects. No biggie for the ever decreasing number of people still on final salary pensions, but for those in pension pots or whatever follows in April, it's a another devaluation.

So, most of the quantitive easing money didn't make it to the 'real' economy. That's the economy where a mere £1bn will rebuild more than 500 schools and £10bn will build 200,000 starter homes. The real workers that would be deployed could spend their sovereign money on stuff, which boosts other parts of the economy.

Oh no. This would never make a Westminster Village scheme, would it?

Even with my profligate spending above of £11,000,000,000, there's still the other £364,000,000,000 of the quantitive easing scheme to consider. That's still more than half a year's total UK government spending.

There's still arguments being trotted out around future austerity - sometimes that's also a code for punish the poorest. Another argument is about how low growth deepens debt so the private sector cuts spending - not what they said when the money was being printed. All of it seems like broken logic after the 2009-14 performances.

The political classes need fresh thoughts as we enter the last 90 days. I suspect it will all be trite polemics whilst the meaningful graphs remain hidden.

clear vision, anyone?

I know we've just been told the date for the budget as 24 March, but although there's election posters all over the place in central London now, there doesn't seem to have been a date declared.

Perhaps naively, I find this slightly insulting to the British electorate. Much of the normal business of Parliament has been turned into the theatre of pre-election sound bites and the two main parties seem mainly intent upon point scoring.

Brown eschewed the opportunity he originally had to be voted in as leader of his party, or to have an election about a year ago when there was a previous opportunity zone.

Now, instead of declaring his position on this publicly, he leaves us all guessing that it will be 6 May, aligned with the date that other local elections are due to take place. I believe there's theoretically a few weeks into the start of June which would still be available, but it would seem slightly odd to get everyone voting twice in a matter of weeks.

So now we are hearing of senior civil servant pay freezes and no doubt some candied words in the Budget, whilst Brown presides over a 12.8 percent of GDP borrowing level (just slightly higher than Greece and about double the rest of Europe).

We'll be hearing more 'weathering the storm' and 'bumps in the road' speeches over the next few days as well as the Conservatives promising to rescind whatever gets stated in the next Labour budget. On top of the sundry scandals, these points reinforce the purposelessness of the last days of the current Government.

This time, to add to the fun we appear to be getting the politician's partners being propelled into the limelight. Miriam, Samantha and Sarah are all being blended into the campaigning to support their husbands and no doubt to receive camera scrutiny of their own.

At least Brown's recent comments about the economy may be accurate: "There will be many months ahead of conflicting statistics, false hopes and mixed signals."

As long as all this doesn't start to affect Britain's credit ratings too.

brown election latest rumours

I should really be writing about something else today, but I can't help noticing that even the Scottish singing lady has been overshadowed by the Scottish talking man.

I see his current line is that we need to avoid chaos and keep the show on the road.

I may have a different view of chaos, so I suppose the small number of items I list below (last few weeks only), next to our illustrious leader (old photo, I'm afraid) officially do not constitute chaos.

Oh no.

economy deep in recession
factory closures
banking crisis
lawmakers' expense claims
tax money to pay MP accountants
snap resignations
individual Lords suspended
Royalty not invited to D-Day event
Cabinet resignations (Blears, Smith) before euro elections
Lords dosh for law change
bumper pensions for errant bankers
full salary and pension rights for ‘mistaken’ MPs
flipping houses to maximise expense claims
Speaker busted
lowest trust index ever for MPs
secret signonnow@hotmail.com plot to oust
meltdown(Telegraph), disarray(Independent), carnage(FT)

Feel free to reshuffle the deckchairs at will.

more UK election 11 July 2009 rumours started

If the Queen has quietly asked Gordon Brown to dissolve Parliament, then we need to work out the timetable. There's usually at least 30 days from dissolution to an election, which rules out most of June.

July has only been used once since 1918 and August and September have never been used because of the summer holidays and the way it would weird out the results.

So theoretically, the most likely month is October, which has been used the most times since 1918; six times in October, followed by five in May and four in June.

Now, if the level of upset was maximum and pitchforks marched upon Westminster, then a July date is still possible, but would require rather a lot of gearing up in a short time. I'm also wondering if a Speaker is needed during the dissolution process, because even that role seems a trifle fragile at the moment.

Technically, Gordon still has another year, with the last valid date of the current Parliament being 10 May 2010. Because of dissolution procedures, the election wouldn't need to be until Thursday 3 June 2010.

So will we get another year of Gordon and Co, or is there election fever in the wind?

We have the Euro elections and a few by-elections in a few days. I'm guessing Brown, Cameron, Clegg and the others are getting into huddles to think about timings and campaigning. In July, it would need to be 4th (oops - sensitive?), 11th or 18th.

And what if the Monarchy did call for the end of the current Parliament instead of it being Gordon's dice roll?

UK Autumn General Election rumours started

I wonder if the Queen could ask Gordon to call for an Autumn General Election?

Just to tidy up the loose ends around the politicians currently needing more time with their accountants.

And maybe to fill some of those gaps from untimely resignations?

Would it be a populist request, or seen as something from a parliamentary monarchist system?

Whose side would you be on?

Back in 1381, when the peasants were revolting and marched on the Tower of London, you'd need to know.

Take the Tower of London test to find out.

1. What do you usually wear?
a. A steel helmet, heavy duty body armour and stout boots.
b. An exquisite bespoke outfit made by the finest French tailors in silk and velvet.
c. An exquisite bespoke outfit made by the finest Italian tailors in silk and velvet.
d. Rags.

2. And for a special occasion?
A. Full metal jacket, gauntlets, mail collar, steel helmet, weapons, cross of St George.
B. An outrageously stunning creation fresh from the Paris catwalk, damask with ermine accents, shoes with pointed toes so long you trip over them.
C. Purple robes, white alb, red and gold girdle with matching chasuble, Mitre and Crosier.
D. Rags (plus a steel helmet, long bow and a pole arm).

3. A Beard is:
A. Bound to get caught in your armour.
B. This season’s must have fashion accessory, worn forked, with a long moustache.
C. Not as good as the old fashioned clean shaven look (including top of head).
D. A symbol of oppression. How much are these beards costing us? I bet they are all false.

4. Your ideal holiday would be:
A. A booze cruise to Calais, with plenty of action.
B. A summer relaxing on your estate in the Dordogne.
C. A Pilgrimage to Canterbury.
D. Holiday?

5. This new Poll Tax is:
A. Hard on your pay packet, but someone has to pay for the army. Perhaps the rich should pay more.
B. An excellent idea. Everyone should pay the same. You can’t get fairer than that.
C. An excellent idea, but don’t forget to put a little extra in the collection plate on Sunday.
D. An unjust oppression of the poorest in society. Make the rich pay more.

6. The Savoy is:
A. A palace in the West end. Totally indefensible. Civilians should make for the Tower if they value their lives.
B. A charming place just off the Strand where you can get a bite to eat in polite company (once it reopens).
C. A palace named after the Savoy family, one of whom was the Archbishop of Canterbury.
D. A hated symbol of oppression, home of the king’s wicked uncle, John of Gaunt. Burn it down!

7. When dealing with foreign tourists do you...?
A. Speak to them in English, but much more loudly.
B. Speak to them in French, the international language of culture.
C. Speak to them in Latin, the international language of scholarship and religion.
D. String them up. It’s the only language they understand.

8. You are visiting the Royal apartments at the Tower when you hear rioting outside. Do you...?
A. Grab your weapon.
B. Grab your hat. Your outfit needs an accessory.
C. Grab a crucifix.
D. Grab anything you can lay your hands on.

9. You find a splendidly bejewelled cup. Do you...?
A. Guard it.
B. Admire the workmanship.
C. Bless it.
D. Steal it.

10. When introduced to the king’s mother do you...?
A. Salute, and call her ma’am if she speaks to you.
B. Drop your deepest bow or curtsey, kiss her hand if she offers it and wait for her to speak first.
C. Expect her to curtsey to you.
D. Jump up and down on her bed and ask her for a kiss.

11. Finally, when Adam delved and Eve span, who was then the gentleman?
A. Adam, obviously.
B. A true gentleman would naturally recognise good breeding.
C. Ask your parish priest to look it up in his Latin Bible. Clue, it’s near the start.
D. No-one. We were all born equal!

How did you do?
Mostly As: Welcome to the Fortress, soldier! The Tower of London needs bold recruits like you to defend its walls and towers against attackers. Help shoot our siege engines this summer!

Mostly Bs: Obviously destined for a life among the knights and ladies of the Royal Court. You might enjoy a visit to the Medieval Palace at the Tower of London. Or come and cheer your champions at the Tournament this summer.

Mostly Cs. A career in the Medieval church awaits! We do have two Chapels Royal here at the Tower. But beware, churchmen have not always had it easy here. In the White Tower, you can find out more about our first prisoner, the Bishop of Durham.

Mostly Ds: You are one of life’s peasants, and proud of it! While lords and knights have tried to take the Tower and failed, it was the peasants who actually broke into the most secure place in the kingdom. Come and see the Tower of London's new display about the Peasants’ Revolt of 1381.