Will the City Lose Its Euro Clearing Business?

Oct 31, 2022 | In this latest Federal Trust video, the financial analyst Graham Bishop and the Chairman of the Trust, John Stevens, discuss the likelihood and the significance of the City of London losing its approximately €100 trillion Euro derivatives clearing business to the Eurozone by 2025. Among other implications, the loss of its status as the main Euro clearing centre might also put in jeopardy its role as the leading global US Dollar hub.

Guest:
Graham Bishop is an independent consultant on European political, financial, economic and budgetary integration as well as the founder of grahambishop.com. He is also a member of the Council of the Federal Trust and, he says, a 'dedicated Europhile'. He has been a fixture in the City since 1972, beginning with Phillips & Drew and ending with Citi where he was a European bond analyst. Adviser to the Co-Chief Executives in Europe on European Financial Affairs.

Cuba: High Prices, Lines and Shortages | DW Documentary

Oct 22, 2022 | In Cuba, the socialist project begun by revolutionary hero and former president Fidel Castro is teetering on the verge of failure. The nation is sinking deeper into crisis, with many people’s daily lives marred by shortages of food, medicine and electricity.

Cuba has been subject to sanctions for decades. Despite recent attempts at reform, the country is increasingly isolated and economically dependent. A currency reform enacted in 2021 is also causing major problems, with inflation soaring and prices skyrocketing. Food is scarce, and lines in front of the few state-run stores are getting longer and longer.

Poverty is on the rise. Even the famous ingenuity of the Cuban people is reaching its limits as they try to cope with the day-to-day effects of the crisis. Images of bygone revolutionaries are fading in the streets the capital, Havana, and all over the island. Official voices continue to broadcast the state’s ideology, but ordinary people are losing hope that things will improve.

En France, la croissance ralentit, l’inflation s’envole

LE MONDE : L’économie française a ralenti au troisième trimestre, la hausse du PIB se limitant à 0,2 %.

A l’image de la météo quasi estivale pour une fin octobre, l’économie française, pourtant handicapée par des prix qui continuent de flamber, refuse d’entrer dans l’hiver. Selon les données publiées, vendredi 28 octobre, par l’Insee, l’activité au troisième trimestre a bien marqué le pas, avec un produit intérieur brut (PIB) en hausse de 0,2 %, après 0,5 % au trimestre précédent, mais elle reste positive. Pour 2022, l’acquis de croissance s’établissait donc à 2,5 % à fin septembre, un chiffre légèrement en retrait par rapport aux prévisions de l’exécutif, de 2,7 %. » | Par Béatrice Madeline | vendredi 28 octobre 2022

Article réservé aux abonnés

CBI Warns Rishi Sunak against ‘Doom Loop’ of Public Spending Cuts

THE GUARDIAN: Director general Tony Danker says it is vital new UK PM does not pursue path of austerity

The head of the Confederation of British Industry has warned Rishi Sunak against pursuing an austerity “doom loop” of cuts to public spending and tax rises amid fears over a mixed outlook for the economy.

Tony Danker, the director general of the CBI, said it was vital for the new UK prime minister not to repeat the mistakes made by David Cameron’s Conservative-Liberal Democrat coalition when billions of pounds were slashed from public spending. “Let’s remember, the 2010s began with some austerity and were then ensued with very low growth, zero productivity and low investment, right? It wasn’t a successful strategy for growth,” he told BBC Radio 4’s Today programme. » | Richard Partington, Economics correspondent | Tuesday, October 25, 2022

Brexit Crippled the UK Economy – Liz Truss Just Made It Worse | Economics | New Statesman

The UK economy under Liz Truss was a “textbook case” of mismanagement, according to economist Duncan Weldon.

Gravitas: Saudi Arabia Wants to Join BRICS

South African President Cyril Ramaphosa has claimed that Saudi Arabia wants to join BRICS. He says Crown Prince MBS showed interest in joining the bloc during his recent meeting with him. Is Riyadh trying to disassociate itself from the West? Molly Gambhir reports.

Pound Sinks as UK Economic Uncertainty Rises

GETTY IMAGES
BBC: The pound fell against the dollar on Friday as new figures showed a gloomy picture for the UK economy.

Sterling slipped to $1.11, after rallying on Thursday as Prime Minister Liz Truss resigned.

It came as official figures showed government borrowing rose to its second highest September on record.

Meanwhile, people are shopping less than they did before the coronavirus pandemic, according to figures from the Office For National Statistics (ONS).

Retail sales fell by more than expected last month, dropping 1.4% and continuing their slide from August, the official figures showed. />
The pound's latest slide comes after a period of volatile trading for the currency. » | Noor Nanji, Business reporter, BBC News | Friday, October 21, 2022

The pound sterling used to be held in high regard all over the world. Unfortunately, its value has gone down and down and down. This is known as managed decline. At the rate things are going for the UK economy, the pound sterling will be little better than junk currency! (Though it hurts me to say so.)

We should have dumped the pound years ago and joined the euro.

For your information, just by way of example, in 1963, the pound was worth more than twelve Swiss francs! 12,2443 to be precise. Today, as I write this, one Swiss franc (CHF) is worth £1.12. In 1963, one pound sterling was worth US$ 2.8. Today, one pound sterling is worth US$1.12. Exactly the same as the Swiss franc.

(Sources: XE.com and PACIFIC Exchange Rate Service)

The Brexit Effect: How Leaving the EU Hit the UK | FT Film

The UK's recent disastrous "mini" Budget can trace its origins back to Britain's decision to leave the European Union. The economic costs of Brexit were masked by the Covid-19 pandemic and the crisis in Ukraine. But six years after the UK voted to leave, the effect has become clear. In this film, senior FT writers and British businesspeople examine how Brexit hit the UK economy, the political conspiracy of silence, and why there has not yet been a convincing case for a 'Brexit dividend'.

Jeremy Hunt’s Statement on Medium-term Fiscal Plan: Key Points at a Glance

The chancellor has announced mini-budget repair measures – here are the main points, with political analysis

Read the article here.

Jeremy Hunt’s economic plan turns the clock back to austerity: UK chancellor’s tightening of fiscal policy will lead to weaker growth and a deeper recession »

The Great Gatsby Curve

Sep 28, 2022 | Miles Corak discusses the fraying of the American Dream, and the power of inequality to disrupt the promise of social mobility.

How Economists Invented Austerity & Paved the Way to Fascism

Clara Mattei discusses her new book "The Capital Order: How Economists Invented Austerity and Paved the Way to Fascism"

Mini-budget Will Likely Mean Higher Interest Rates, Warns Bank of England Governor

THE GUARDIAN: Andrew Bailey says UK borrowers can expect to feel impact of Truss government’s tax and spending decisions

Governor of the Bank of England, Andrew Bailey, says extra stimulus in last month’s mini-budget would force the Bank into tougher-than-expected action. Photograph: Drew Angerer/Getty Images
UK borrowers can expect to face higher interest rates as a result of the Truss government’s tax and spending decisions during its six weeks in power, the governor of the Bank of England has warned.

Despite the U-turn on corporation tax on Friday that saw the sacking of Kwasi Kwarteng as chancellor, Andrew Bailey said the extra stimulus provided in last month’s mini-budget would add to inflation and force the Bank into tougher-than-expected action.

Bailey said he had impressed on the new chancellor, Jeremy Hunt, the need for the public finances to be sustainable and that there had been a “clear and immediate meeting of minds”. Hunt used his first interview to stress mistakes made by Truss would require “difficult decisions” to be made. » | Larry Elliott | Saturday, October 15, 2022

Forecast by the IMF Shows Germany and Italy Are to Tumble into Recession in 2023 | Business Special

Daniel Lacalle: Rate Hikes Will Continue as Inflation Remains

Oct 14, 2022

Daniel Lacalle.

Thomas Piketty on Capitalism, Corbyn and Why Zuckerberg Is Getting It Wrong - BBC Newsnight | 2015

Renowned economist Thomas Piketty sits down for a tête a tête on the world economy with Evan Davis

More German Businesses Go Bankrupt amid Weak Economy, High Inflation | DW News

A sharp uptick in the number of German firms beginning insolvency proceedings is raising eyebrows in Europe's largest economy. Some 762 firms declared bankruptcy in September — a 34% increase from the same period last year.

And the upward-trend is set to continue this month and the next, according to the Halle Institute for Economic Research. Its new report suggests that by November up to 40% more companies could be beginning insolvency proceedings, compared to the same period last year.

Did Brexit Work for Business? | Dispatches | Channel 4 Documentaries

Sep 15, 2022 | Is Brexit, and the new free trade deal with the EU, the huge success the Government said it would be? Dispatches meets firms struggling with increased costs and dwindling profits.

Global Fallout from Rate Moves Won’t Stop the Fed

THE NEW YORK TIMES: The Federal Reserve, like many central banks, sets policy with an eye on the domestic economy. Its battle to control prices is causing pain abroad.

The Federal Reserve has embarked on an aggressive campaign to raise interest rates as it tries to tame the most rapid inflation in decades, an effort the central bank sees as necessary to restore price stability in the United States.

But what the Fed does at home reverberates across the globe, and its actions are raising the risks of a global recession while causing economic and financial pain in many developing countries.

Other central banks in advanced economies, from Australia to the eurozone, are also lifting rates rapidly to fight their inflation. And as the Fed’s higher interest rates attract money to the United States — pumping up the value of the dollar — emerging-market economies are being forced to raise their own borrowing costs to try to stabilize their currencies to the extent possible.

Altogether, it is a worldwide push toward more expensive money unlike anything seen before in the 21st century, one that is likely to have serious ramifications. » | Jeanna Smialek and Alan Rappeport | Friday, October 7, 2022

Daniel Lacalle: Collapse. Europe Energy Crisis Gets Worse

Turkey Inflation at New 24-year High of 83% after Rate Cuts | DW News

Inflation in Turkey climbed to a new 24-year high of 83.45% in September, according to official data, after the central bank surprised markets by cutting rates twice in the last two months.

Turkey's repeated reductions in rates come at the insistence of President Recep Tayyip Erdogan, who believes — contrary to well-established economic principles — that reducing interest rates can slow inflation, rather than fuel it.

Is the UK Heading for Economic Disaster? | DW Business

Rising mortgage costs, pensions eroded, despairing businesses. It's only been a week since Prime Minister Liz Truss and her Chancellor, or Finance Minister, Kwasi Kwarteng announced a new economic plan to slash taxes and boost borrowing in the United Kingdom. But what a week it's been.

Trickle-down Truss Is Carrying On the dirty Work of Thatcher, Blair and Osborne

THE GUARDIAN: Britain has endured 40 years of decline thanks to this faulty economic theory. Will Keir Starmer finally kill it off?

If Kwasi Kwarteng’s mini-budget survives the storm it triggered, a banker on a million-pound annual salary stands to receive £50,000 of income tax relief – on top of the extra bonuses the bank can throw in, now that the Liz Truss government has removed the cap on them. Meanwhile, a Deliveroo rider gets a pep talk on the emancipatory value of aspiring to be wealthy, presumably as an incentive to pedal harder. This is the gist of the government’s growth strategy or, according to former Brexit minister David Frost, its antidote to stagnation and defeatism.

While it’s tempting to draw the obvious analogy between zombie ideas such as the trickle-down growth effect, and the classic Hollywood horror film Night of the Living Dead, a more appropriate response to the seriousness of the situation is to follow the banker’s extra cash. The government claims the banker will invest it, thus promoting growth. If it were not a blatant lie, it might have passed as a touching example of unfounded faith. But unlike Adam Smith’s bakers, butchers and brewers, who would invest any spare cash into better and more bread, ale and meat, the banker will buy into some fund that will, in turn, purchase shares, derivatives and bonds.

These recipients of the banker’s extra money have a long track record of not investing in actual productive capacity. Why would they, when the masses out there can’t afford to buy new, high-value products? … » | Yanis Varoufakis * | Saturday, October 1, 2022

* Yanis Varoufakis is the leader of MeRA25 in Greece’s parliament, a former finance minister of Greece, and author of Another Now