Labour isn't working - Thread 21

[TheNuthatch]

A chat thread for those who don't like this Labour government. 💙

We are bracing for the budget 😬

The problem with socialism is that you eventually run out of other people's money.

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I’m not surprised.

Also the OBR downgrade just after the budget, I question if that was a handy date change to help get this one through.

Could be. I don't trust anything anymore.
They are determined to lie their way out of trouble at every turn.

Quite.

If there is one certainty with this lot, they have an uncanny ability to make an unforced error, which they subsequently attempt to spin their way out from.
Deflection is their stock-in-trade.

Can I pick your brains please? You understand this stuff far better than I.

So I had a conversation with someone today. They are crazy intelligent, too intelligent sometimes to properly articulate so I've been trying to translate it in my head all day. 😂

Here goes. So he said that Reeves deliberately announced an income tax rise (early morning speech), knowing that she would shortly change course once the result had been achieved with the markets. Followed by loads of shop speak that I didn't understand.
The inference was that this would give her better figures to work with re bonds or similar etc from the OBR or similar. She could then use those figures in the budget, but still row back on the income tax rise without those better figures being affected.
I hope that makes sense. Basically it was done to manipulate the figures Reeves had to work with, but I don't know if any figures were due, or any particular event took place between the income tax speech and the row back.

Good grief.

It’s a fair question, interested in answers to this

I wouldn't credit her with enough nouse to plan anything so clever.

I can make a tentative guess at this:

This marks the window of the obr taking the temperature read of the bond markets which is used to make their forecast of how much spending we'll have to make on our debt repayments. And it was in that window when she was doing the big income tax gesture that settled down the markets.

And so, the suggestion is that she manipulated the landscape to her budget benefit by floating policy that she never intended to follow through on.

Thats a fair point. Torsten Bell though?
I just want to know if those cleverer than I thought it was even plausible what he was suggesting to me. I dont really understand 'the markets'.

Actually, if I had read the article that I just nicked that graph from it explains it better:
Cunning plan or a gamble that didn't pay off? Why some think the chancellor pulled off something extraordinary | Politics News | Sky News share.google/CQWKBZtZDzLoqZCdU

Incredible. Well found

Oh yes, I didn’t know that the game was to then not do the income tax rises but that weird early press conference was definitely all about bond markets and managing the debt. Given that it ‘worked’ we’ll see more of it.

Labour probably think the interest on the debt and the fiscal headroom is a bigger issue than the economic uncertainty they’ve caused with all the speculation. Of course, they’ll say it was simply the nasty media speculating.

You're a star! Thank you. I think that was what he was trying to say. Its been bugging me all day trying to work it out.

Just to add, I was not in a position to say that I didn't understand what he meant. That would not have been met with good grace. He is not political, but has made an awful lot of money with stocks and shares. I was boxing above my weight 😂

You're welcome. Let me know if he gives you any hot tips 😁

Will do.
I doubt I'd understand them if he tried, but you'll be top of the list 😂

I'd whoop his ass in a quiz about aggregate, or 50 different recipes you can make with sausages. 😂

I understand.

It would make sense in so far as a straight, say 2p, on income tax, would be the cleanest way to raise revenue, and would unquestionably have been welcomed by the bond markets, despite being a clear manifesto breach.

I think what your friend is saying is, that therefore the OBR’s improved numbers were a consequence of the bond markets reacting favourably to the proposed income tax hike, before it was pulled/replaced.

The large bond investors are primarily concerned with inflation, and fiscal discipline (read headroom), through a combination of tax rises (and ideally, spending cuts), hence the markets have been relatively sanguine recently, given the former. They are naturally unkeen on uncertainty and flip flops, so I struggle to see how Reeves would have benefited from another u-turn.

For context, taking 5 year gilts, YTD they have traded at 3.85-4.6% approx, with today marked at 3.97%. Point being, they are volatile.

If there was a particular fiscal event, where Reeves needed to ‘capture’ that day’s value - for mark to market purposes - I am not aware of it, but your friend may know better.

Sorry for the windy reply!

Edit: I see the team have found the answer - chapeau!

No, thats great. Thank you.
I knew you could explain it better than he did. Asking him to explain would have amounted to me lowering myself iyswim.

He's not a friend btw, he is a now ex client that I have to associate with. Total arrogant twat now I think about it. Likes to call me 'flower' in meetings. Think Elon Musk without the medication. 🙄

Flower, lol!

I knew a CFO who was called ‘darling’ during a board meeting - it ultimately cost the firm 500k when she subsequently litigated…

Dinosaurs!

If they were 'Lying' to the markets, what are the consequences when this comes out. How can the markets lend to them at inexpensive rates, if they tell lies about policies and the countries current economic situation.

There is going to be 'Hell' to pay if the Government figures cannot be trusted or seen to be lying to the markets. I sincerely hope the press conference and briefing was down to incompetence, than trying to play the market.

Dinosaurs indeed. Fuckers.

Anyway, I'm glad I won't have to deal with him for much longer. Every cloud...

Thanks again

Dinosaurs reminds me of Lammy, if only we could sue for that.

Kenneth Clarke was talking about not leaking budget stuff because it impacted the markets, now it seems to be the only think Reeves and Starmer have left.

What a complete arsehole @TheNuthatch Yeah, you can't offer a sliver of ignorance around people who are scanning for opportunities to make you feel small. I would have kept quiet too.

Well if they have tried to manipulate the markets, it seems they messed it up and got their timing wrong. Anything is possible with this shower 🤷‍♂️

Flower, love, darlin'...all red rags in my book.

I am contemplating buying a lettuce on Wednesday….