The Premiership ofLiz Truss. Sept 2022-Oct 2022. New PM time!

[mandryka]

Possibly, but I believe there are only around 20 members of the ERG

That's interesting if correct.

 

[Nic Robinson]

Are there no ERG'ers in the already declared numbers for spaffer?

 

[droodzilla]

Interesting graph (had seen of course, but couldn't remember exact numbers). The increase after WW1 and WW2 war years is, the economic effects causing considerable distress (WW2 rationing didn't end until 1953). In recent times interest rates have been historically low, but that could all be about to change, which would have a dramatic effect on how that looks moving forward. (Not sure what proportion of our loans are fixed rate or varioble, and what currency they need to be paid back in - do you know?)

I'm not sure that the "considerable distress" after WW2 was down to the increase in the national debt per se. Europe was in ruins.

 

[Tony L]

R.Mogg backing BJ, and making very loud noises, so not all of the erg would be supporting Sunak. If he wins, they will do their utmost to bring him down I would imagine.

Baker was really quite threatening on Sophie Ridge earlier, effectively stating that if Sunak didn’t back the international law-breaking Tory NI protocol the ERG insurgency would attempt to bring the government down. It is always good to see the Tory Party fractured and eating itself, but given the amount of bloodshed before peace in NI was found via the GFA the arrogance and recklessness of these extreme Brexit gammons is chilling. Baker and his ilk really are as CGM described. Absolute monsters.

 

[paulfromcamden]

It's also worth bearing in mind that a huge percentage of this money is money we owe ourselves via said institutional investors.

You mean undemocratic unregulated city fat cat casino speculators shirley!

 

[notaclue]

Are there no ERG'ers in the already declared numbers for spaffer?

Yes, quite a few. Mogg, Cash, Lee Anderson, Fabricant, plus others. Though I don't think the membership is officially made public. A list here, but might not be all as the Telegraph reported 60 members will be meeting tomorrow.

 

[Jim Audiomisc]

This is true. But, PR aside just for one minute (!), the biggest and loudest “we” have voted for this shit for the best part of half a chuffin’ decade.

Now while thee and me might not have voted for this shit, a democratically significant number of taunts over the years have.

And I’m not sure of thee!!!

Sadly, true.

FWIW I've voted either Labour or Scots Nat. Albeit that our local LD people are generally quite decent.

 

[notaclue]

If true, oh dear. The S*n reports Johnson has the 100 names confirmed and Heaton-Harris (message to MPs below) has now filed the paperwork. Johnson is standing.

I wouldn't put is past them to be lying (including The S*n), but best to brace for an incoming Johnson in Downing Street within days.

 

[gustavm]

M

Bonds are sold in different terms -- 2yr, 5yr, 10yr, 30yr -- with shorter terms coming with a higher rate of interest. When you hear about people talking about the yield curve they mean the shape of the curve you get by plot this interest rate over time from now to 30 years.

When the bonds expire the government borrows more by selling additional bonds at the regular auctions they hold and the price investors pay at these auctions sets the interest rate the government will pay. So at any point in time the government has a mixture of bonds of different terms and at different interest rates.

Also note that currently about 1/3rd of all these bonds are owned by the Bank of England as a result of Q/E, so in some sense we are borrowing, lending and paying interest to ourselves. Which again points to why you shouldn't think about government debt as being like credit card debt or that 50 quid you owe Big Mick from the Nags Head

(Somewhat incidentally bond traders don't generally speaking trade the actual bond but instead trade the shape of this curve by being long or short at various points through time usually via some form of derivative. Which is partly why it's somewhat confounding to hear people talk about how band traders move the curve when in fact most of their trading is about doing things in such a way that they are insulated from changes in the absolute price and are really trading the slope of the curve which is effectively the change over time)

Many thanks for this knowledgeable and comprehensive answer. The tone of much of the discussion on this thread is that the coming austerity as a result of recent events is a political choice not a necessity (Most commentators over a range of political views seem to agree with latter).

I know there is always a degree of political choice...but what is your take? How deep is the trouble the UK is actually in?

 

[MUTTY1]

So ex chancellor who told BJ he had to go is now backing him as a unity candidate?

What a state of affairs

These are intelligent/worldly people. You just have to wonder where they lost their moral compass.

 

[NeilR]

These are intelligent/worldly people. You just have to wonder where they lost their moral compass.

it is all very reminiscent of the republican party and Trump.

 

[Sonority]

Baker was really quite threatening on Sophie Ridge earlier, effectively stating that if Sunak didn’t back the international law-breaking Tory NI protocol the ERG insurgency would attempt to bring the government down. It is always good to see the Tory Party fractured and eating itself, but given the amount of bloodshed before peace in NI was found via the GFA the arrogance and recklessness of these extreme Brexit gammons is chilling. Baker and his ilk really are as CGM described. Absolute monsters.

From 'The Guardian' - I was not aware that braverman was top of the pile' in the ERG..
"In a damning verdict on the prospect of Johnson returning as prime minister, Suella Braverman has said the party “cannot indulge in parochial or nativist fantasies”.

She warned fellow Tory MPs not to be “naive” when deciding who to nominate in the contest. Braverman’s decision is significant as Johnson’s team had made a “big pitch” to her on Saturday in the hope that winning over the former home secretary would persuade fellow rightwing MPs to back him.

Braverman is a former head of the European Research Group of Brexiteer MPs. It is a further sign that the ERG is split down the middle between Sunak and Johnson."

 

[Tony L]

Good. Anything that harms the ERG is unquestionably in the national interest.

 

[MUTTY1]

Braverman is a former head of the European Research Group of Brexiteer MPs. It is a further sign that the ERG is split down the middle between Sunak and Johnson."

Hope you are right. This group of zealots have done so much damage to the country and still think they are right. Fortunately, I think the have reached their zenith and are now on the way out. I use Rees Mogg as my weather stick and he will be back to the back benches where he has spent most of his political career. I just hope the rest of Europe catch on to this indulgent rightest nonsense before it too late.

 

[matthewr]

I know there is always a degree of political choice...but what is your take? How deep is the trouble the UK is actually in?

I think in trouble is the wrong phrase as it's not like we face an existential crisis or anything. Rather we face a lot of very hard choices and the politics of our current government means that the people who will pay will be the poor and the vulnerable.

My personal view is that:

1) Monetary policy is not the answer because our current circumstances mean you want to both raise (to prevent inflation) and lower (to help with cost of living) interest rates.

2) We should therefore look to fiscal policy which basically means raising taxes.

3) Normally I think we should use taxes as a means of redistribution to help the working poor and the vulnerable, but given the current cost of living problems I think that with spades on.

4) I think ruling out windfall taxes (which are obviously one offs not on going) is nuts. When things are tough, take the low hanging fruit!

 

[Tony L]

I use Rees Mogg as my weather stick and he will be back to the back benches where he has spent most of his political career.

I expect he’ll lose his seat next election and will slink off to counting the many millions he made shorting the UK currency and our collective business interests. He is a total arsehole IMHO. The absolute worst kind of manipulative class-warrior parasite elite education can create.

 

[MUTTY1]

I expect he’ll lose his seat next election and will slink off to counting the many millions he made shorting the UK currency and our collective business interests. He is a total arsehole IMHO. The absolute worst kind of manipulative class-warrior parasite elite education can create.

And does it with such panache! He makes Johnson look an amateur when it comes to explaining how black is actually white. A national treasure in a dystopian world.

 

[tonerei]

Hopefully good news that Sunak will win out. He will close the gap on Labour so hopefully PR might get on the agenda if it is touch and go.
Feels like the end for Bojo and JRM politically but will be a slow death. Hard to see how Sunak can make much of an economic impact in the next 2yrs. Best I think to leave the Tories at it. It would be a poisoned chalice if an election was held shortly.

 

[matthewr]

will slink off to counting the many millions he made shorting the UK currency and our collective business interests.

Am pretty sure his firm trades emerging markets rather than anything UK based and they have been losing money consistently for the last few years anyway. It is in the process being sold though and he will make a pile of money out of that.

Generally I find this whole shorting the £ idea a bit spurious. Even Odey's fund is basically trend following so he will have been short the £ anyway regardless of any shady insider deal with Kwarteng. Which is not to say that these are not odious people and bad actors only that I find the "OMG shorting the £!" angle unconvincing.

 

[matthewr]

Hopefully good news that Sunak will win out. He will close the gap on Labour so hopefully PR might get on the agenda if it is touch and go.

I don't see how a Labour 40 seat majority makes PR any more likely than a 120 seat majority. To make any difference you need Labour not to have a majority and to be forced into a coalition. Or Starmer to have an outbreak of public spiritedness which I suggest is even less likely.