I posted this on Twitter this morning:
But what if it isn't worth saving because it long ago ceased to add value? Why isn't the CBI asking the big questions instead of calling for state subsidies for a failed business? They should walk their talk….. https://t.co/wZ8RFmbzAU
— Richard Murphy (@RichardJMurphy) July 9, 2025
My point is serious. The CBI is saying that the situation with regard to the UK stock exchange is getting desperate, because it is losing out to overseas markets and not attracting sufficient business.
The question that needs to be asked is, why is that? The CBI believes it is due to short-term regulatory and tax issues, but the truth is that the market has been failing for decades.
If the stock market worked, we would not have a crisis of investment in the UK, with a massive shortfall compared to other countries.
Similarly, if the stock market really worked, there would be no productivity crisis in the UK.
And likewise, if the market functioned properly, we would have decent pension returns in this country, and our pension funds would want to invest in companies listed on our stock market; however, neither is true.
The London Stock Exchange is, instead, just a gambling den. The odds are stacked against the investor, as they always are in such places. The return is small, at best.
And let's not pretend that the stock market is a source of funding for businesses: it has not played that role for decades. Businesses are not funded by shareholders now and have not been for a very long time.
Why doesn't the CBI recognise the call for fundamental reform of the stock market in that case?
And why does it have the temerity to ask that we subsidise something that is so obviously failing, when it supposedly hates everything to do with state interference, let alone state support for failing industries?
The CBI needs to get its act together. It is, as usual, showing that it only acts on behalf of vested interests, and not on behalf of real business, the national interest, or the economy.
I guess there's no surprise there then.
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Thank you and well said, Richard.
In late 2021, I did some work for the LSE Group and noticed how irrelevant the stock market side was and how, frankly, odd and uninspiring and listless the managers were.
Since then, LSEG has got the Foreign Office to promote the stock market side overseas. It’s so desperate.
With regard to the CBI, I often worked with them, and other trade bodies, from 2008 – 14 and found them equally uninspiring, ill informed and, again frankly, the last bunch the government should be engaging. I note that many small businesses despaired of the CBI, especially over fair tax, excessive rent etc.
Much to agree with, based on my experience of the CBI, much of it around then
In the past you have expressed less than great enthusiasm for Pratley of the Guardian, and I agree, except I have no enthusiasm for pretty much anything printed in that rag. However, today Pratley is calling for, I suppose, some kind of government advertising/marketing campaign to boost the London Stock Exchange. Up is down, black is white, private is best, except when the private sector needs help, then socialise the costs, and any profits should then accrue to the private sector.
https://www.theguardian.com/business/nils-pratley-on-finance/2025/jul/09/london-stock-exchange-needs-a-shot-in-the-arm-from-the-treasury
That’s desperate
Thank you, John.
Pratley is showing off his ignorance again. Perhaps, he ought to get out of their rather grand King’s Cross office a bit.
A dear friend is a financial attache at large and director at the Foreign Office. Her team’s mandate is to promote British business and Blighty as an investment destination. They are assessed. The Foreign Office has been told it must pay its way.
Promoting listing on the LSE and the use of the LSE as a governance adviser is part of her remit. The government then thinks the earnings will trickle down.
It’s desperate and laughable in equal measure. The world has also moved on.
Stock market is a business. If a business fails then they are meant to shut down. Creative destruction in action. Or is the government once again picking winners at the expense of everyone else. Capitalism in name only. Socialism for the rich.
I sometimes look at systems we have created and wonder if we have a monkey, banana and ladder experiment, or variation of, going on. The people in the stock exchange need the line to keep going up because they have all forced each other to believe something bad will happen if it doesn’t or if anyone tries to do something different.
The thought that terrifies me is that society itself may be a giant version of this and that we’re unable to make things better as there’s too many violent people (monkeys) that will destroy the world over trying to make it better.
Everything about the stock market is regulated. The objectives of regulation are
1. Protect regulators from criticism.
2. Protect politicians.
3. Keep the public quiet.
Providing a useful economic and social service comes nowhere.
Might the B. B.C. actually fulfil its “alleged” duty of “balance” by always broadcasting their usual/enforced data and comments/propaganda on the “market” along with ditto on unemployment, food banks, rough sleeping, homelessness etc.?
I think Harold Wilson as President of the Board of Trade brought the Stock Exchange back to life in 1950/1951.
Prior to that the UK had functioned without it.
The LSE’s primary market function appears not to be needed in the same way.
Asking why that is would be a helpful question rather than simply supporting a private concern that’s in trouble.
Source?
Richard,…
I’m convinced that the source is Selina Todd’s book The People the rise and fall of the working class 1910-2010.
However can’t find the details. I will have another .
Source search is proving difficult.
My son Luke who is more qualified in History added this comment when I was enlisting his help:
Good question. I’m not sure i have anything that would cover this point in detail.
My recollection is that Wilson did not restart trading per se, but more that he worked to remove a series of restrictions/controls that had been introduced place during the war and that he did this over a period of time rather than in one ‘moment’. I think the exchange continued trading, albeit with these restrictions in place, throughout the war and up until 1951 barring a handful of days here and there.
So because I can’t back up my comment which is a tad frustrating I’m suggesting my son’s words are more appropriate.
Wilson is a fascinating character who entered Cabinet at the age of 31. He promised a bonfire of controls/regulations but these were mostly directed towards rationing for every day living.
That sounds entirely plausible
Have you asked the Stock Exchange?
I’ve looked at their website pages on history but not good on detail.
However a phone call might be more useful. I’ve also got an academic paper on Wilson’s time as President of the board of trade which I will have a look at.