not sure about the economy but the u turn us stopping a rebellion and possibly riots….

So what does this give the economy back in terms of improvement?

A stress test?

Not sure I get the u- turn

It’s what they think a political masterstroke looks like. Now the door is open to say “the 45% band is maintained, lets have a look at these benefits”.

Broadly, the mini budget was popular for everything except the high tax band and bankers bonuses. They drive Mary’s popularity to the floor and then take it up slightly and say how she’s becoming more popular.

And RNP – dead right Jake Berry is an odious turd who would be pelted with vegetables if he ever showed his fat face in Rawtenstall. Which he wouldn’t

More suspicious minds might consider that Kwasi’s Fiscal Event was a good ruse to generate some earning and donations for his ‘friends’, I mean no one would deliberately create instability to earn a few quid would they? 🤣

Even with a U-turn, it’s only cost a few billion to sort out, precipitated interest rate rises, down-graded UK’s credit rating, caused untold stress for millions…

No MPs turning up for the Tory love in in brum might have had something to do with it and Gove is looking for another leaders scalp.

So what does this give the economy back in terms of improvement? I bet in reality it’s not much ?

Didn’t judge the mood correctly.

Despite the metrics.

Big picture: everything is a global mess and they don’t know what else to do – so regular old Tory style not going to cut it. We knew this of course.

Be interesting what happens next.

Depends on inflation and growth. I don’t think Truss is going to get an easy ride with what’s coming. And I don’t think any Tory is capable of fixing this, especially with supply chain issues and dollar dominance.

Frankly it would take someone with real brains and left wing balls to turn the ship.

People are so bloody thick – talking about the ‘taxpayer cost’ to the BoE for 65billion. Jesus Christ. It was a swap of reserves for gilts. No net cost.

Using the £/$ as the metric for changing something is totally misguided. It’s been dropping for years so you already have the problem. Especially when the dollar’s strength is out of your control.

Danger with charts is over analysing small time-frames.

I don’t mind the u-turn. Better to get shut of it for the right reasons now.

Wage inflation is a higher paid job though. Or am I missing something.

Not if the wage hasn’t risen for a long time.

Even with a U-turn, it’s only cost a few billion to sort out, precipitated interest rate rises, down-graded UK’s credit rating, caused untold stress for millions…

thing is none of those impacts of the mini budget were really due to the 45p rate. The cost of it was small (compared to the package of other tax cuts and, in particular, the energy price cap) so the markets won’t be particularly bothered with it. it was just politically awkward

Not if the wage hasn’t risen for a long time.

[American]Why have you sat on your arse waiting for the wage to go up? Go out and get some training so you can get a better job… [/American]

I think this is very clever.

They can say they listened to the people and have cut the smallest part of their Britannia Unchained budget, the rest will now sail through.

NHS for sale before the next GE.

[American]Why have you sat on your arse waiting for the wage to go up? Go out and get some training so you can get a better job… [/American]

Ha ha.

British: what better jobs?

Taxi for KK, if they can drag him out from under the bus.

So U-turn on that tax rate cut? No surprises they clearly didn’t like the polling on that.

Reading a report in the FT that doesn’t seem to be the reason at all. Rather than a “change of mind” and the realisation that the policy was politically indefensible and damaging it was in fact that the policy would be impossible to implement in a real and practical way.

Truss concluded after talks with her senior team that the plan stood no chance of getting through the House of Commons.

One cabinet minister close to Truss said: “It’s a very painful decision but we had no choice ultimately. There was no way we were going to get the Budget through.”

https://www.ft.com/content/29ebdd94-8c13-48fa-8718-4c86cce902a8?shareType=nongift

Obviously Truss and Kwarteng will claim that the so-called U-turn was because they listened and the issue had become a distraction from their overall economic strategy, but up until last night they were still maintaining their determination to stick with the policy, despite that by then it had become extremely clear how damaging it was for the Tories.

What appears to have happened is the cold stark realisation that they wouldn’t be having the numbers on their side when the division bell was rung.

The next battles they face with Tory rebels in marginals and leafy green constituencies will be over bankers bonuses and the Green Belt.

People are so bloody thick – talking about the ‘taxpayer cost’ to the BoE for 65billion. Jesus Christ. It was a swap of reserves for gilts. No net cost.

The ‘cost’ is £65bn moved from one account to another, but it can’t be moved again – so presumably there is a ‘cost’.

Ok I know this has had serious consequences for many folk but by heck its hilarious. I don’t think I have ever seen a political farce like this.

Look how he is wearing his watch. And this man is trusted to run the economy

Clearly a wrong-un

Saying it as it is…

UK gov u-turns on top tax rate abolition because it’s a ‘distraction’. Morally wrong and hugely costly for millions is a better description. Utter ineptitude.
Perhaps those who slammed @scotgov for not immediately following suit should also be reflecting this morning…

— Nicola Sturgeon (@NicolaSturgeon) October 3, 2022

Look how he is wearing his watch.

I’m more worried that he hasn’t worked out what the arms on his glasses are for.

The ‘cost’ is £65bn moved from one account to another, but it can’t be moved again – so presumably there is

No. New money creation.

The BoE doesn’t need to do cost. No tax-payer money involved.

They can unwind by selling the gilts back. Which they were claiming they were going to do shortly before all this kicked off.

Reading a report in the FT that doesn’t seem to be the reason at all. Rather than a “change of mind” and the realisation that the policy was politically indefensible and damaging it was in fact that the policy would be impossible to implement in a real and practical way.

They wouldn’t be ignoring the polling would they?

FT can wrap it up however it wants.

It costs a lot if you wanted to move your pension that week. Real money and it’s cost some bloke a champagne lunch.

The BoE doesn’t need to do cost.

Get another record. This one is scratched. There is a real cost to the UK of bailouts like this. A cost to us.

Question is, what else does she have to try and fix things?

It costs a lot if you wanted to move your pension that week. Real money and it’s cost some bloke a champagne lunch

That’s because pensions shouldn’t be perhaps tied to the market. And we’re all at the mercy of the ‘market’ that is the economy we’ve got – on a superficial level.

And as I’ve been saying for ages the £/$ had been on a trajectory downwards for ages – this was a few days blip on that. The news just highlighted it for a day. If you watch assets on a micro level they shoot up and down quite a lot.

You can argue forever and a day about market place but we do have the capacity for the state/BoE to do whatever the government wants it to. Hence they stepped in here, and in the pandemic and the last crash.

Being put in a secure home and ignored.
Is bedlem still open I here a few political professionals have been sent there before

Get another record. This one is scratched. There is a real cost to the UK of bailouts like this. A cost to us

I’m talking funding. You’re undermining the way things work with this sort of establishment language.

I’ve had enough of people talking like this. You don’t like what’s being said then ignore it.

Just simply not necessary.

(And yes there is a greater cost to society when things screw up but you could spend a bit of time looking at the numbers yourself. It’s not my fault the BoE produced 65 billion out of thin air. That’s what happened. And everyone thinks the tax payer is paying. I’m going to correct that every time.)

Question is, what else does she have to try and fix things?

That is the question.

Probably not much. Hope that inflation corrects itself and a recession doesn’t appear?

@rone I believe the pension fund thing is being looked at or was it’s a stack of cards waiting to fall.
Could be worse could be credit Swiss *

Just to emphasise the lack of mandate that the fiscal event has and why not calling a general election should be a stick used by opposition parties to constantly beat the new government with – the Truss/Kwarteng/Philp government today:

https://www.telegraph.co.uk/news/2022/09/21/liz-truss-rip-green-planning-laws-bid-kickstart-housebuilding/

Green planning laws will be ripped up by Liz Truss in this week’s fiscal event in a move that could see tens of thousands of new homes built on protected land.

Chris Philp of the mad trio last general election:

Labour plan to build on greenbelt

These measures are completely unnecessary to meet housing demand (which can be met through development on brownfield and sites in Croydon town centre).

The coming General Election is a chance to send a message to Labour that this kind of vandalism of our area is completely unacceptable – by voting against them.

@pk13 – I don’t know. Pensions are bit confusing to me but I know enough to know they’re linked incorrectly to a market place that works against most people.

FT can wrap it up however it wants.

Why would the FT want to “wrap it up”? They are totally opposed to the economic policies of Kwarteng/Truss

Why would the FT want to “wrap it up”? They are totally opposed to the economic policies of Kwarteng/Truss

Well I can’t read the article for obvious reasons but you suggested it was nothing to do with polling.

I feel it is.

Like we’ve said Tory tax cutting would normally be welcome to the establishment.

And RNP – dead right Jake Berry is an odious turd who would be pelted with vegetables if he ever showed his fat face in Rawtenstall. Which he wouldn’t

Or Darwen.

https://12ft.io/proxy?q=https://www.ft.com/content/29ebdd94-8c13-48fa-8718-4c86cce902a8

Thanks – that’s just a report of what happened. Not sure what that adds .

put https://12ft.io/ in front of pretty much any paywalled article and you will get it.

Well I can’t read the article for obvious reasons but you suggested it was nothing to do with polling.

I feel it is.

What do you mean you can’t read the article for obvious reasons? No FT, no comment mate.

My quote points out that Truss didn’t have the numbers on her side because of the scale of the growing rebellion in the House of Commons, and that’s the reason the policy was abandoned.

Obviously opinion polls had an indirect effect as they put pressure on Tory rebels but there is no evidence that polls had a direct effect on Truss or Kwarteng – they were still not backing down last night 10 days after the mini budget even though it was clear how unpopular it was.

What appears to have changed their minds was developments such as Gove’s intervention and simple arithmetic suggesting that the numbers weren’t there to get the policy through the House of Commons.

You are actually doing them a favour by backing their claim that they “listened”. It’s not a favour which they deserve imo. If they had felt that the policy would have easily gone through the Commons with a huge Tory majority I’m sure they would have stuck with it.

Agreed Ernie. This policy was nuked by Tory MPs. Of course they have an eye on the optics of tax cuts for the rich, planned to land straight after a hard winter for everyone else. Their constituents aren’t all on £150K+.

You are actually doing them a favour by backing their claim that they “listened”. It’s not a favour which they deserve imo. If they had left that the policy would have easily gone through the Commons with a huge Tory majority I’m sure they would have stuck with it.

I’m not doing them a favour. That’s silly. A few pages ago you were agreeing that Tories function on tax cuts!

I don’t know our opinions are that different – the’ve performed (to me) an expected U-turn because they know what they were about to do was deeply unpopular. It takes inertia to get to that point – and may I point out that even when the pound tanked they didn’t whisper about U-Turns then.

What do you mean you can’t read the article for obvious reasons? No FT, no comment mate.

I don’t do FT. Why would I! I’ve got enough to read.

And yeah they did listen for their survival – ‘course they did.

Pensions were traditionally linked to gilts rather than the stock market for low risk and predictable returns. However, the low rate of return on gilts led to a hedging into stocks and shares to maintain returns. This strategy was termed Liability Driven Investment (LDI). It unwound last week because returns on gilts rose so they become less attractive and prices fell, but pension funds needed to cover their positions in shares (using money they had borrowed) and had to liquidate (sell) their gilts into a falling gilt market spiralling the cost down. The BoE said we’ll buy those gilts thereby propping up the price (for a couple of weeks anyway).

If you are in a company pension scheme, you will see different management options depending on time to retirement. The above is why. Long time to retire? Shares will offer growth. Retiring in five years? Switch to gilts and cash.