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Archive for the ‘UK economy’ Category

UK trade deficit widens as fall in sterling fails to improve export sales

Posted by seumasach on August 11, 2017


10th August, 2017

Britain’s trade position with the rest of the world worsened in June as the sharp fall in the value of the pound since the Brexit vote failed to lift sales of UK-made goods abroad.

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Foreign takeovers proliferate post-Brexit

Posted by seumasach on August 12, 2016

When you have massive debts and you’re never anywhere near to getting to0 the end of the month there are three logical options. Firstly, you can enter into a deal with your creditors, in this case, primarily, China. This is the now discarded Osborne option after the lately departed Chancellor of the Exchequer. Secondly, you can “take out” your creditors. This is the al Capone/Hillary Clinton option. Or, finally, you wait for the bailiffs. This is are post-Brexit option. As the pound falls the Chinese and others will simply buy up the UK in the Great British sell-off. In a way, it is good news since they could simply convert the sterling reserves to gold or other assets, leaving the pound to sink even further. By triggering the regionalization of the UK the Scottish independence referendum has helped to prepare for this scenario by dividing the country into bite-sized units forced to sell assets to make ends meet. Regional administrations can also easily be dominated by overseas interests. I have long argued for the first approach whereby we continue to act as a sovereign nation by resolving the debt issue through negotiations at state to state level. That approach has been spurned and the Panarin scenario looms. Of course, it’s not too late to change course.

From semiconductors to soccer, foreign takeovers are good news for Britain post-Brexit


12th August, 2016

While alarmist in tone, this narrative is in part borne out by data – stats recently released by Thomson Reuters point to an increase in the value of foreign takeovers in the month after the UK’s vote to leave the EU. Almost 60 transactions totalling $34.5bn were struck by foreign companies for British firms in the month after 23 June, compared with 79 deals worth $4.3bn in the month leading up to the vote.

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UK’s financial services sector will retain its passporting rights despite Brexit, Boris Johnson says

Posted by seumasach on July 23, 2016

Johnson’s “everything will remain the same despite Brexit” argument reflects either that he is completely delusional or that he is strongly hinting that Brexit is not going to happen at all. Regarding passporting rights, that will be in the hands of the Europeans and it is no secret that Paris and Frankfurt are vying to succeed London as Europe’s financial sector. His assurances lack all credibility and reflect the bizarre post-Brexit limbo into which we have been cast. Meanwhile, as the incoming capital flows on which we are dependent dry up, the perspectives for the UK economy and living standards are dire in the extreme.


23rd July, 2016

London will remain a global financial centre, according to Boris Johnson, the UK’s newly appointed foreign secretary. Speaking at the United Nations in New York, Johnson dismissed fears over the country’s financial services sectors losing its passporting rights amid the Brexit vote.

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China, Britain and Brexit

Posted by seumasach on June 30, 2016

As I have argue insistently on this blog, the partnership with China is the only solution to Britain’s deeply entrenched economic problems. Brexit would anyway place it at risk but it’s much worse than that: Britain is now run by people openly hostile to Europe. The “golden relationship is now neither politically nor economically in China’s interest. The reality of Britain’s economic plight will now be cruelly laid bare.

Vote to leave EU robs ‘golden relationship’ of its lustre


30th June, 2016

It was all sealed over a pint of Greene King IPA.

One Thursday evening in October 2015, David Cameron strode into a Buckinghamshire pub with another of the world’s most powerful men to toast the beginning of a golden era of relations between the UK and China.

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Britain courts fate on Brexit with worst external deficit in history

Posted by seumasach on April 5, 2016

Arch-Eurosceptic Evans-Pritchard seems to have lost his nerve on Brexit. That a”No” vote is a vote for disaster is increasingly clear. However, a “Yes” vote in itself will not resolve Britain’s deep-seated problems. We await a positive programme for the reconstruction of British society and economy so far absent from the debate.

Ambrose Evans-Pritchard


Britain’s current account deficit is the worst ever recorded in peace-time since the Bank of England started collecting records in 1772 under the reign of George III.

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The UK could learn a lot from Germany’s long-term industrial strategy

Posted by seumasach on March 31, 2016

With a consensus emerging that the British steel industry is a strategic asset which must be saved and a leader of the opposition calling for a “strategic state” and a”national investment bank”, the post- thatcherite consensus on non-interventionism is breaking down. This is a very recent shift and a very sharp check on the opposite trend embodied in the Tory/SNP regionalisation of Britain project. Both centripetal and centrifugal forces are currently vying for primacy and yet it is clear that central control is necesarry to rebuild Britain’s industrial base.

Larry Elliot


30th March, 2016
As a share of its economy, Germany’s manufacturing sector is twice the size of Britain’s – 23% of national GDP, compared with 11%, according to the World Bank. Unlike Britain, it runs a large surplus on trade in goods. The German steel industry has not buckled under the pressure of dumping by China.

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Cameron’s UK and EU economic governance agreement

Posted by seumasach on March 5, 2016

At the heart of negotiations between Cameron and the EU was the issue of the single rulebook on banking regulation and , more particularly, the rules on bank recovery and resolution, the power of the European Banking Authority to

“apply bail-in measures: i.e. convert debt to shares or write it down – in this way, losses are imposed, according to an established order, on bank shareholders and creditors, not on taxpayers”.

These rules are applicable from 1st January, 2016 and are apply throughout the EU. As this article argues, the concession of “some flexibility” in the application of these rules  gained by Cameron is unlikely to amount to much. So it looks like continued membership of the EU makes a further bail-out of British banks inconceivable. This would explain, perhaps, why so many within British elites are up in arms against the Cameron deal and now support Brexit. It also provides strong motive to support a “Yes” vote.

The UK in a changing Europe

23rd February, 2016

Within the rules of the club, Prime Minister Cameron achieved as much as could be expected on economic governance from the European council negotiations. But the gain in flexibility he obtained may turn out to be rather less significant in practice.

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Decision Time: New Politics, New Economy, New Britain?

Posted by seumasach on March 3, 2016


Decision Time: New Politics, New Economy, New Britain?

A speech by Jeremy Corbyn to  the British Chambers of Commerce conference

Labour Press

3rd March, 2016


This speech sets out a major policy framework including some notable quotes (with my own comments):

And we cannot outsource economic policy to the City of London. That has not served our economy well, and it has not served business well.

The subordination of the UK economy to City interests is, indeed, at the heart of the matter

The banking sector has to be reformed. Finance must support the economy and not be an extractive industry that treats consumers, entrepreneurs and businesses as cash cows.

Rather than simply going on about capitalism Corbyn clearly distinguishes between predatory finance capital and productive capital in the real economy. Robert Owen the 19th century socialist and entrepreneur who wanted an alliance between the working class and the industrial capitalists against City interests would be very happy with this speech. It is significant that he is addressing the Chamber of Commerce.

We need a national investment bank at the heart of economic policy to target investment on key public and economic priorities, not just for quick returns.

As Den Xao Ping used to say: “whatever you do never lose control of financial system.” We never had control of it but perhaps that’s about to change

For some politicians, the state is only a burden, to be reduced or removed.

But we see a crucial role for the strategic state to create the conditions for people and businesses to thrive and deliver prosperity that is stable and shared.

The term “strategic state” is an absolute taboo in British politics. Are we becoming French dirigistes? If there is one word(or two words) to sound the death knell of the thatcherite consensus, it is this.

Regarding crisis in NHS

First, there is the legacy of PFI debt – an inefficient way of delivering necessary investment.

The last Labour government lacked the confidence to make the argument to borrow to invest, and so it did what banks thought they could get away with before the crash, an off-the-books accountancy wheeze.

In both cases, putting debt off the books did not work it came right back onto the books and helped trigger crisis.

Corby takes  the Blairite legacy head on! Blair put dodgyPFI deals at the heart of his programme

Then there is the problem of infrastructure. Think about the creaking, underfunded infrastructure our country relies on.

Enterprise and innovation cannot flourish when our roads and railways, ports and airports are lagging behind our competitors.

To do this , of course, requires long term investment and planning another no-no in Thatcherite Britain

…we are campaigning to remain in the EU because we believe, like 60 per cent of businesses the BCC surveyed, that the EU is the best framework for trade and cooperation in the 21st century.

None of the above can be accomplished without incoming investment, several hundred billion of which have already been promised by China. He knows that they are awaiting the “yes” vote before committing themselves to this but it is not very politically correct to point this out since the British people are still largely unaware of the fact that we have been living off incoming investment for decades. The difference now is that investment will not be going into UK government bonds but will be direct investment in finance, manufacturing and infrastructure.

Read speech in full

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Brexit!? France and Germany cannot wait

Posted by seumasach on March 1, 2016

This is essential background for understanding the EU referendum and particularly the rather surprising decision by Cameron to support a “Yes” vote despite having no opt-out on European banking regulations. But a “No” vote would be even worse from a City point of view as this article makes clear. Still, there will be winners and losers and clear and bitter divisions are emerging in the British  ruling class which we haven’t seen since the period following the “loss” of the USA in the American Civil War by way of the defeat of the Confederacy. That period of internecine warfare in the British elite was eventually resolved by the expedient of outsourcing the empire via a truly massive flow of capital into the USA. Similarly, today we face a historic transformation of the City of London although, this time,  based on massive capital inflows through our Comprehensive Strategic Partnership with China and the new relationship with Europe which corresponds to it. The strong support for a “Yes” vote by Goldman Sachs and JPMorgan suggests the possibility that London could also serve as a conduit to Wall Street for Chinese investment via those chosen vehicles.


19th February, 2016

If London decides to leave the European Union nobody in Europe will even notice. Great Britain is an entirely separate country, isolated from the European Union and does not participate in the Euro or Schengen Agreement. The European Union as a political platform is disintegrating and becoming more and more irrelevant and will be displaced by the European Monetary Union (EMU).
The center of power in Europe has shifted from the EU to the EMU and London politicians are fully aware of it. A Brexit will accelerate the process of political integration of the EMU members and make the EU politically less significant.

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Who are the real culprits behind UK’s collapsing public services?

Posted by seumasach on February 29, 2016

Dan Glazebrook


27th February, 2016

Anyone following David Cameron’s negotiations with the EU, or the subsequent ‘in-out’ referendum debate in Britain, would perhaps forgiven for believing that migration is the cause of all Britain’s woes.

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Johnson adviser: protections for City “unimpressive

Posted by seumasach on February 22, 2016

Boris Pensions Tsar: EU Deal ‘Unimpressive’

Sky News

Protections for the City of London secured by David Cameron as part of his deal to reform Britain’s membership of the European Union (EU) are “unimpressive” and amount to “no more than a whingers’ charter”, one of Boris Johnson’s key advisers has said.

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