The Guardian has a story, published last night, that says:
Bank of England meeting could discuss cutting interest rates
A recent run of bad news on the economy may have chipped away at Mark Carney and other policymakers' certainty on the path for interest rates
The logic is:
The Bank of England's interest rate setters meet against a gloomy economic backdrop this week that could prompt at least one policymaker to push for a cut in borrowing costs to shore up stalling growth.
Let me be clear, I think the chance of such a cut is very low indeed, at least at present. And the article could be a little mischievous by the Guardian (although I suspect it is based on a tip off; that's the way these things work). But that said, the idea is also not so far fetched.
The March budget from George Osborne has unravelled, faster even than his notorious pasty budget of 2012. The U turn on school academies - which many would argue he had not reason to announce - is just the latest debacle he has associated himself with. And the economy is, without doubt, doing worse than expected.
It is also beyond question that the so called political master mind has lost his touch. Goldsmith did not win London. The referendum campaign is not exactly zinging.
What is almost certain is that there will be a major cabinet re-shuffle and blood letting after the referendum on 23 June, whatever the result. In that case, and given Osborne's threadbare recent track record is it unfair to wonder whether his time at the Treasury might be coming to an end?
In which case who (Philip Hammond) might replace him? And with what impact?
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I’ll do it.
May be someone who understands economics – Adair Turner. Or at least someone willing to listen and learn, and is driven by what is good for the economy rather than ideology.
You’re suffering from overwork, Richard;o)
🙂
Osborne will survive, I suspect. These people are ‘plastic politicians’ and no more than ‘simulacra’ (cf. Baudriard) of political discourse. We all know that there cannot be a recovery and globalisation is causing its own destruction We’ve got global oversupply and weak demand due to debt deflation combined with mindless austerity on top of burgeoning ecological disaster. We know the model needs changing and Labour, as yet, is not unambiguously stepping up to this plate.
Khan as shown himself to be a backward looking figure wanting to be another ‘man in a suit’ with notions of trying to shove Labour to the right again to make it ‘electable’-these are the people of the past. Most people dislike the Tories and regard them as shysters and amateurs but the alternative is not as yet, being articulated.
My prognosis: everything needs to get worse before it can get better, maybe a lot worse before the idiocy in its fullness is revealed.
“My prognosis: everything needs to get worse before it can get better, maybe a lot worse before the idiocy in its fullness is revealed.”
Humans are unbelievably resilient and adaptable. They can survive without complaint from the frozen tundra to the Arabian desert, on tiny Pacific atolls or Lagos rubbish tips. Tragically, there are almost no depths of deprivation that cannot be endured by humanity – waiting for things to get worse before they change means that, sadly, we could be in for a very long wait indeed.
True, Mr. Shigemitsu-but I hope we don’t have to wait until we have reached the lower levels of hell like the Lagos world techno-dump with its Dante-esque scenario. But I agree the wait will be long-waiting for Labour to clear out the Blairites and allow new economic thinking and myth busting to come in could be years ahead.
In the meantime we have to keep our spirits as alive ans hopeful as possible-my daily diet of Murphy and Mitchell with some added Richard Wolff keeps me going!
You may not be wrong at all.
I think he will survive as the Tories routinely reward mediocrity and privately endorse his main aims and objectives which is to eviscerate the public sector and the role of the State.
Having said that, would anything change if we had a new chancellor? It seems to me that Francis Maude and Oliver Letwin are still the back seat drivers here.
Worth reminding ourselves of Letwin’s book written back in 1988 called ‘Privatising the World’. see: http://www.amazon.co.uk/Privatizing-World-International-Privatization-Practice/dp/0304315273
I like the Amazon reveiwer who gives the book five starts and writes: ‘Buy this book to get angry.’
Cut in the Bank Rate? A classic case of denial by Mark Carney and the business and government elite (who appointed him to do the PR) that the real problem is inadequate demand:-
http://www.thomaspalley.com/?p=544
Donald Trump has declared today that he’ll be partially jumping on the MMT band-wagon. You will immediately recognise his debt discounting arguments Richard!
http://socialdemocracy21stcentury.blogspot.com/2016/05/trump-mmt-covert.html
Won’t be long before the Conservative government does the same but I wonder how they’ll lie (apply spin) to justify their about-face?
Scarily, he gets it
I think Trump has been consistently blending elements of libertarianism, anti-military-industrial complex,Christian right, nationalism, Pro Putin, anti-immigration idea.
He’s trying to be a catch-all that blends bits of the whole spectrum. He’s ‘America can’t default’ isn’t an indication of MMT understanding, I think it’s rather a parroting of Greenspan who said the same thing and he was a free market fundamentalist.
What more evidence do we need that we’ve reached the ‘End of Normal’?