Does this include “internal inflation” that arises from spouses owning your wallet?
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The majority of non believers think its a scam to pay more tax.
Thick as shit
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Doesnt the US have some big chunk of debt to refinance in the next couple / few months?
The FED will want interest rates as low as possible for that and a bit of inflation. Open season after that I guess.
There is about $3 trillion of US debt maturing in 2025, a very large portion of that is in short-term notes (30 days to 1 year). But those Treasury placements aren’t in the Fed’s control, they are in fact when the market grades the Fed’s homework. If the Fed has to step in to buy those Treasury bills to make the auction work, well, that is quantitative easing. That will hit the inflation rate and the exchange rate in real time. If the Fed doesn’t, the market is going to set the yield rate, and the Fed doesn’t have much choice but move into alignment with what the market is saying.
That scenario is more or less what Truss inflicted on the UK with her rate spike, though the US one would be more driven by the sheer size of the debt refinancing needed. That is likely why the US yield curve is flat out to the one year mark, the market really doesn’t know what to expect next month, but there are worries.
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While Los Angeles is literally on fire. The cognitive dissonance is staggering.
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Just catching up with PMQs from yesterday…
I got a letter this week from a Tory voter in a Labour seat, I hope they don’t mind me saying who it was, it was Liz Truss. She was complaining that saying she crashed the economy was damaging her reputation. It was actually crashing the economy that damaged her reputation.
This should be interesting.
Poor Liz…
Pew! Pew! Pew!
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At least now we know Sir Keir is getting a steer from TAN re his Liz Truss gags.
I thought he was a Gooner??
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Maybe he’s their Mubbseh
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Wrote a post about this and Local Council spending yesterday - in response to a comment someone made - but decided against it. After today’s call for a review, I thought it was worth posting the link to show the potential problems with giving Local Authorities more control over their budget.
Nb. I am not being critical of anyone here, just wanted to highlight the risks of this. BCC are and were already in massive debt at the time of the Commonwealth Games.
Not great, and not helped by covid.
Lots of places seem to have this post [major event] legacy issue. The London olympic site, sydney olympic site, west hams ground, Etihad and so on.
There’s a real planning issue here i feel.
Isn’t the point simply that such major events are often a net economic negative? I presume that’s part of the reason why so few countries seem to be interested in bidding for them nowadays.
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This Birmingham one is a bit tragic to be fair. Unable to complete the village in time for the games the cost appears to have been a noose round their neck.
They’ve kept some for social housing at least.
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They often end up giving the infrastructure away (e.g. City and West Ham inheriting stadiums on the cheap). Even the 2014 Glasgow Commonwealth games, which came in under budget and used existing infrastructure, required a chunk of public money to stage. I think the legacy there was 1,000 new houses and an old people’s home.
I suppose that events like this have rather taken the place of the garden festivals in terms of economic development.
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So why did Birmingham City Council, laden in debt take on this net economic negative?
We can’t pick and choose when to ignore the effects of COVID or use it as an excuse.
It was a noose they chose to put around their neck.
To host the games it required BCC to find £184m of funding, the Central Government funded the rest.
From your trusted Guardian newspaper;
“The council has spent £325m on the development, of which £292m was borrowed. After selling off the homes, it is expected that £142m-£152m of debt will remain unpaid, costing £8m-£9m a year over a 40-year period to repay, taking the projected total loss in the region of £320m.
The report said: “This will be an additional pressure to the already strained financial position of the council, and compensating savings will need to be made elsewhere in the council’s budgets.”
It’s just mismanagement, no other way to put it.
How can the Council take on a Financial burden when already in debt, be required to find £184m worth of funding (central Government providing the other £500m+) and then end up with an estimated loss of £320m on their spreadsheet.
I can understand why BCC would want to host the Commonwealth Games. Money from the Government to invest in local infrastructure, a short term local economic boost and potentially a long term gain by raising Birminghams profile.
I live in Birmingham, and don’t get me wrong, the City was buzzing. So many people enjoying themselves, my Nieces loved it.
As I have said, I’m not trying to point fingers, shit happens. I’m just trying highlighting recent inadequacies with giving Local Governments extra powers to manage their budgets.
Unfortunately, it is not a one off with BCC.
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Is this possibly related to the Audit Commission being disbanded? The Commonwealth Games losses appear to be mainly related to this athletes’ villiage. Obviously, the lack of completion was out of their control but they should have still been able to sell the housing as originally intended. In fact, I’m not sure why they couldn’t.
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The studies around what they will contribute are usually shockingly flimsy, minimal rigour and laughably optimistic assumptions are the norm.
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Just expect all major events to be held in sports-washers newly built infrastructure.
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Shaping up to be a pretty good week for Reeves, it began with speculation that gilt could go over 5% and the government would be on its knees by March, and it might well end with the rate below 4.6%. Doesn’t sound like a high difference, but it represents time, credibility, and a greater ability to make one’s own decisions.
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