The birth of a one-liner

Over the past few weeks, I've been critical of Team Osborne's inability to distil their economic message - and their attacks on Gordon Brown - into simple language that can sink into the public consciousness.  But, to be fair, Osborne's just coined a fairly effective one-liner on the interest rate cut, that deserves highlighting:

"It may be a shot in the arm but it shows how sick the patient is."

I'm sure there'll be occasion for the shadow chancellor to wheel this one out again, in future - and not just in...

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Now that's a cut

So, those pushing for a 1 percent cut in interest rates have got their wish - and then some.  The Bank has just announced a 1.5 percent cut in base rates, bringing them down to 3 percent.  That's the biggest cut since 1981.

Now what does this - frankly, quite astonishing - move tell us? Two things, in particular: 1) That the Bank feels that the doomsayers - the people like David Blanchflower, with their "cut rates or die" prognoses - are most probably right.  Things are worse than the Bank initially thought, and they're trying to play catch-up. And, 2) that the officials really, really want significant cuts to...

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Bank cuts rates by 1.5 percent

The dramatic and urgently-needed cut in base rates – by 1.5 points to 3 percent – is a comment on the extent of the deep recession that Britain is sliding into. It has been made possible by the collapse in inflation expectations.

Because fewer Brits will have salaries - and most of those who have are coping with real-terms pay cuts - shoppers’ wallets are empty of earned and borrowed cash. Shops will have to slash prices to move goods – it will be murder on the high street. Ergo the collapsing inflation expectations allow...

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The odds for the Glenrothes by-election

Courtesy of Ladbrokes:

SNP --- 2/5
Labour --- 7/4
Conservatives --- 100/1
Lib Dems --- 100/1

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Reasons to have faith in Cameron and Osborne

I have been pretty hard on Cameron and Osborne during the financial crisis for three reasons: their failure to shoot down Brown’s fake narrative, the sheer size of the open goal in front of them, but most of all because of their ability. Both can do far better than this, neither suffer from the politicians’ greatest weakness – being wedded to past mistakes. Some CoffeeHousers ask why I have such faith. The reason lies in Cameron and Osborne’s accomplishments so far:

1) Radical welfare reform, with an agenda so solid that Labour has copied...

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