Liz Truss PM - Gone Within a Year?
- Thread starter MOIC
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T
The Byre
A third round of regicide would turn into a circular firing squad and spell the end of all chances of a Conservative government for decades. For that reason and that reason alone, she is safe. (It ain't much of a back-stop, but it's all she's got!)
All Labour has to do is look competent and they will nail the next election. There are far more rocks in the river to upset the Good Ship Truss -
- Falling house prices, leading to the opposite of the wealth effect - the poverty effect. Voters will blame the government for rising interest rates.
- House repossessions and negative equity - I guestimate that there are c.a. 1.5 million UK mortgages that be refinanced in 2023 and as many again in 2024. Those mortgages were locked-in at an average rate of about 2%. Refinancing will happen when mortgage companies will expect at least 6% or more.
- Then the rest of the bear market has to kick in - we had the first drop, after which the "Buy the dip!" fools that believe the pundits on CNBC go out and buy shares - forgetting that the job of a bear market is to take as much money off as many people as possible! This will affect private pensions and investments.
- The UK has one of the lowest amounts of net foreign currency and gold reserves as % of GDP in developed markets.
- Political pressure is mounting to index-link social security and benefits payments. Truss has already stated that state pensions will remain index-linked. This means that she is forcing herself into a dreadful corner of continued fiscal expansion (look at the latest BoE intervention in the long-end of the bond market!) With the Dollar Wrecking Ball hitting the exchange markets, the release valve for the UK may be the continued decline of the Pound.
- She is probably going to try another round of governmental austerity. Well, that went really well the last time it was tried - NOT! The "Austerity Anomaly" of forcing savings without restructuring will result in an increase in costs - more demands for government largesse and not saving anything!
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Theoretically as people have to continue to work and thus pay taxes instead of claiming state pensions
Not on the gdp growth side per se but reduces state spending
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I am not sure how it will help her anyway. In the 2 years left of this parliament she can't get any pension changes in and saving money - she can just make changes for the future to save future govt's.
I believe the next change is for people born between 1970&74 whose retirement age will go up from 67 to 68. That will be in 2037 - so anything that actually changed things within this parliament would be too soon for the pensions industry to adapt (remember most pension schemes start changing the mix of assets on a timetable leading up to retirement so they need roughly 5years min to react safely
I believe the next change is for people born between 1970&74 whose retirement age will go up from 67 to 68. That will be in 2037 - so anything that actually changed things within this parliament would be too soon for the pensions industry to adapt (remember most pension schemes start changing the mix of assets on a timetable leading up to retirement so they need roughly 5years min to react safely
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What happens / has happened when what used to be full-time jobs (in manufacturing for example) become automated, this rendering previously large workforces redundant?
I mean, I get that the unemployment figures are manipulated to make them look good (16 hours a week jobs, two part time jobs that used to be one full time job, family carers doing a couple of hours here and there etc).
But surely, overall, there’s less work to be done by more people (growing population). Have we reached a point where, actually, there just isn’t enough productive stuff that needs doing anymore in this country, and that’s that?
I mean, I get that the unemployment figures are manipulated to make them look good (16 hours a week jobs, two part time jobs that used to be one full time job, family carers doing a couple of hours here and there etc).
But surely, overall, there’s less work to be done by more people (growing population). Have we reached a point where, actually, there just isn’t enough productive stuff that needs doing anymore in this country, and that’s that?
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We are supposed to be short of labour at the moment.
But in any case, your answer implies the economy is a zero sum game, which it is not.
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I think that the issue is (as it was in the early 90's) that the areas we need more labour in and not aligned with where we have people looking for work - either in location, skills or salary.
Back then we had a need for IT staff as the computerisation of "stuff" happened but the majority of unemployed people were redundant from mass industry and despite what may have been said miners, car assemblers and steelworkers were all well paid workers (even compared to low and middle end IT jobs)
Now the shortage is in "people" industries like care - a lot of those require innate skills not ones you teach or can easily automate but are paid badly per hour as we just don't value those skills as a country (i think that is a sexist hangover personally)
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Coming from the tech industry for 15 years (before oldy taking the path I'm on now), we were always crying out for developers etc in order to build and maintain systems. Some systems of which were for automation projects that did indeed reduce the need for staff.
One product I had a short-staffed development team on was a bespoke bit of software for a well-known UK high street brand. The software itself made staff more efficient and reduced errors/wastage but jobs were formed in other areas in order to support this.
One example of this is self-checkouts. From my reckoning, Tesco and the likes have actually increased staff count even though traditional jobs within the business such as check-out clerks are not needed as much anymore. Instead, they are used elsewhere for jobs that automation and robots are still decades away from carrying out themselves.
My personal opinion here is that it's not a lack of jobs but more a huge shift in skill sets. Gone are a lot of the easy low skill-based jobs. Which, yes, might be a problem within itself since our education system is pants anyway.
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Precisely, and as a country we are useless at long term skills planning - we wait until the last second, look for 10 seconds then try and steal from a country with lower pay.
That only works for a while (we will run out of cheap labour sources) and it breeds resentment (see rise of UKIP) if people believe others are being bought in and taking their jobs leaving them on the dole Queue. But it is near impossible to train a developer (and even less anyone with actual analysis skills) in a few months, particularly if the trainee is older and coming from a totally different industry
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Well I can only speak about Tesco's they did lay off some staff when tills were removed, and as part of a restructure all full timers and supervisors gone replaced with part timers, only 18 hour contracts available. Only full timers in store are the manager and his immediate deputy.
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That's interesting. I do wonder though if this is because a lot were of the older generation who were originally only hired to always be on the till anyway? From a quick google, they've increased (20k or so) employees over the last 10 years. Granted a lot of this could be because of opening new stores, but would they be able to open new stores if they were not able to run them more efficiently?
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The country needs true tradespeople, particularly in construction. From bricklayers to plasterers etc, more vocational jobs but with quality training, not just cheap labour to learn on the job.
The country needs a huge house building program, refurbishment of old stock, plus major infrastructure projects. If the youngsters felt such trades were valued and paid well with a career path, they would go into them.
Unfortunately too many think doing stupid dances on TikTok is a better bet, as always for one in ten thousand it might be, most will end up in dead end jobs.
The country needs a huge house building program, refurbishment of old stock, plus major infrastructure projects. If the youngsters felt such trades were valued and paid well with a career path, they would go into them.
Unfortunately too many think doing stupid dances on TikTok is a better bet, as always for one in ten thousand it might be, most will end up in dead end jobs.
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T
The Byre
There is no such thing as a lump of labour - as @Justin Smith stated, it is not a zero-sum game!
See above - UK productivity is way behind other West-European countries and it is falling. What is going wrong is a lack of investment in technical and practical education and investment in modern production plant. We need no more Music Technology students, sociologists, philosophers, diversity specialists, historians, theologians, musicologists, Media Studies grads, golf course managers and all the other useless rubbish that still to this day is being churned out by the hundreds of thousands.
What we do need is technicians, engineers, scientists and mathematicians and we need this -
As for Comrade Truss, she has about two-thirds of Tory voters and parliamentary figures against her, ranging from sacked ministers to disaffected Red Wallers to MPs who wanted Rishi Sunak for PM. One of them said: “She is a lame duck, holed below the water line and there is blood in the water!”
This party conference was meant to be the easy part: announce loads of tax cuts, bang on about growth and be hailed and applauded by her ministers and loyal Tory MPs, all rounded off with a standing ovation from the party faithful.
Instead, it has been chaos, with a major tax about turn which will come to define the Government and top Tories fighting about whether there is a plot against her. But the real problems are going to come when the Government tries to cut spending to reassure the markets in the coming weeks.
As one former Tory strategist told the Telegraph: “If this is the good news, just wait till they get to the bad news!”
Remember that the £65bn bond buy-back by the BoE was just a stay of execution - if the money markets get wind of more unfunded government borrowings, government bonds will drop like so many stones again and the BoE cannot buy those bonds ad infinitum! If they did, all hell would break loose!
And the money markets have long since come to the conclusion that this government and this chancellor do not know what they are doing. They do not understand the one-to-one-to-one connection between bank rates, bond prices and the value of the currency.
One ill-judged statement would probably be all it would take to plunge the T-bill market into another shitstorm!
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I think outside forces will come into play, Europe, of which we are a part of, has a huge weak banking sector, probably best shown by the massive decline in Credit Suisse fortunes.
This one bank alone needs too off load mid 20 billion dollars of debt, and is likely to ask shareholder for £5 billion for a huge restructure. To say this could be a Lehman moment for Europe is not far from the truth. Who would ever think the Swiss banks would be suffering so much.
Sooner or later, a major bank is going to, or should I say should fail, and the contagion effect will push the whole world into yet darker waters.
End of the day, everyone knows what is about too happen, be it one week or one year, the longer it is delayed the worse the result and the longer the cure will have to be. The world needs to start making worthwhile products, building massive new infrastructure and millions of houses.
The crazy thing is, there is plenty of money to do so, just not the political will yet.
This one bank alone needs too off load mid 20 billion dollars of debt, and is likely to ask shareholder for £5 billion for a huge restructure. To say this could be a Lehman moment for Europe is not far from the truth. Who would ever think the Swiss banks would be suffering so much.
Sooner or later, a major bank is going to, or should I say should fail, and the contagion effect will push the whole world into yet darker waters.
End of the day, everyone knows what is about too happen, be it one week or one year, the longer it is delayed the worse the result and the longer the cure will have to be. The world needs to start making worthwhile products, building massive new infrastructure and millions of houses.
The crazy thing is, there is plenty of money to do so, just not the political will yet.
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T
The Byre
Credit Suisse is one - there are others, especially the Deutsche.
But I do disagree with the sentiment "another Lehman's" as Lehman's Bank was just $600bn. CS and Deutsche Bank are $2.8 trillion combined.
Add all the other minor banks that are hanging onto their coattails, add to that the hugely leveraged bond markets everywhere, pl;us the Wall Street banks that are holding them and you may have something many orders of magnitude greater than the 2008 crash.
But I do disagree with the sentiment "another Lehman's" as Lehman's Bank was just $600bn. CS and Deutsche Bank are $2.8 trillion combined.
Add all the other minor banks that are hanging onto their coattails, add to that the hugely leveraged bond markets everywhere, pl;us the Wall Street banks that are holding them and you may have something many orders of magnitude greater than the 2008 crash.
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And why havent we got any ?
because they won't fund 6th form or vocational colleges properly. When the funding formulae are per head and the premium for STEM subjects is less that the extra cost in space required for their teaching the economic imperative is to stack them high and teach them cheap. Plus schools are incentivised to send students to Uni not into a trade so that is what they do
This is not something new - when my wife was at Uni 30 years ago she was one of the last to do "Integrated Engineering" they then stopped it and demolished the building (including the massively expensive totally isolated vibration lab) as they could teach an order of magnitude more humanities students in the same space (contact time for an Engineering degree at the time was c20 hrs a week and my economics was c9 - she had labs and lectures I had lectures in a big lecture theatre and seminars in small rooms)
If we want tradespeople we need to train them and that means proper vocational training spaces
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I read the other day that some supermarkets are thinking of getting rid of their self checkouts because the level of theft from them makes them unsustainable. It quoted some stats saying the supermarkets average margin was about 2% and that self checkouts increased theft to over that level.
Neither Aldi not Lidl have them (not the ones round where I live anyway) and that's got to tell you something !
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If you go round any middle level housing development (i.e. still fairly upmarket) there are loads of vans parked outside the houses.
That's got to tell you something #2
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The self checkouts have some control because you have to place the right weight on the platform. The ones that are really shoplifters' dream are the self-scans. You scan as you go and don't have any firther (except for random) checks.
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Interesting thoughts! Although I have to say, I do like shopping at Aldi/Lidl mainy because of price points but I absolutely HATE their checkouts. I believe they are paid bonuses the more throughput/quicker they get through customers... and it shows in the service sometimes.
Also, to be fair, in the smaller stores (such as Coop etc) I rarely bother with self-checkouts unless the queue is big. I've never seen an Aldi/Lidl bigger than a normal-sized Asda/Tesco (before they started doing the more localised outposts) so perhaps that also has something to do with it.
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The problem with CoOp self service checkouts is they don't take cash and I try not to buy anything under about £10 with a card as it just clogs up ones bank accounts with spam. In fact if I have to buy something for the business (on the debit business card) I get charged 35p as well, an even bigger no no !
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Weighing Avocados and entering carrots I think is the classic example.
New build Aldi near us has has self scan. It's a much larger footprint than the old one, but still has the same 5 aisles, just with with more space between them. I think the booze section across the (wider) rear wall must be bigger.
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Lidl have had them since early lockdown here and Aldi fitted them a fortnight ago. I believe because the Aldi staffing model was multiskilled staff but the huge increase in footfall was meaning they couldnt do their other jobs (stacking shelves etc) as tied to tills to take money.
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