Money

Is Bill Gates shorting Tesla? He certainly didn’t deny it in an interview with the Today programme. The suggestion is that he has upset Elon Musk, who has complained that he couldn’t take Gates’s philanthropy on climate change issues seriously if he was betting against the share price of the world’s biggest electric car-maker. But Musk’s outburst rather evades the issue: is Tesla’s share price destined to fall? You could be the most ardent climate change campaigner, the biggest enthusiast for electric cars in the world – and still think that Tesla is overpriced. The trouble with Tesla’s market valuation is that not only does it assume that electric cars

The Federal Reserve is playing catch-up. Today’s interest rate hike is only the second rate rise since 2018 – but it’s the first half-point rise in 22 years. As expected, the federal-funds rate – the interest rate banks use to lend to each other on a short-term basis – will rise from a target range of between 0.25 and 0.5 per cent, to a range between 0.75 and 1 per cent. After many months of insisting price hikes would be transitory, with inflation soaring to a 40-year high in the meantime, the Fed is finally acting to curb it. By historical standards, today’s hike keeps interest rates very low –

As the Prime Minister pointed out this morning, looming recession and soaring inflation are not uniquely British problems – though right now the UK economy is slowing faster than many of our rich country competitors. In the US for example, the IMF’s former chief economist Ken Rogoff has warned just today that the Federal Reserve’s official interest rate may have to go as high as five per cent to suppress rampant inflation. Which is one of the reasons I was nonplussed when the PM told Susanna Reid on ITV’s Good Morning Britain that he’s reluctant to increase universal credit and benefits and protect poorer people from the ravages of inflation

The state would be prioritised over everything else. Taxes would be constantly, if stealthily, raised. Spending would be reclassified as investment, and shifted off the balance sheet wherever possible. And macro stability would be out-sourced to the Bank of England, while the Treasury would take total control of domestic policy. A quarter of a century ago this weekend, as New Labour was swept into power in a landslide election victory, Gordon Brown, then a relatively fresh-faced Chancellor, completely overhauled economic policy. In a whirlwind week, he put in place the most far-reaching reforms in a generation. And yet, 25 years on, that consensus is still in place. Twelve years of

This week, a US economy that had been expected to grow in the first quarter of the year was recorded as having shrunk 0.4 per cent – a stunning fall, raising awkward questions about what might come next. This morning, it emerged that the Eurozone grew by just 0.2 per cent over the same period, with inflation in both the US and Europe topping seven per cent. America is ahead of Britain when it comes to the global economic slowdown For weeks now, investors in America have been spooked by the ‘inverted yield curve’: a technical term, but one which carries certain implications. When this happens (i.e., short-term government bonds

A wave of government spending would reboot the economy. Fairer taxes would pay for restored infrastructure. Skills would be improved, productivity raised, and new digital champions would emerge. When Joe Biden was elected, he promised the most radical programme of economic reform since Franklin Roosevelt’s New Deal in the 1930s, and, to his army of cheerleaders at least, the American economy was about to be completely transformed. But hold on. Only a year into his term, the reality is very different from the promises. In reality, the Biden Bust has arrived. Donald Trump may have been personally obnoxious, but he bequeathed an economy in perfectly good shape The US GDP figures

Thierry Breton, the European Commission for the internal market, lost no time in rattling his sabre at Twitter as soon as it was announced that the company had accepted Elon Musk’s offer to buy it. Even though Musk had made no announcement on how he intends to run the company, beyond stating his belief in free speech, Breton felt it necessary to warn Twitter that if it ‘does not comply with our law, there are sanctions – 6 per cent of the revenue and, if they continue, banned from operating in Europe.’ There is a reason, of course, for the failure of Europe to produce a tech giant Is Breton’s

It sometimes feels like every regulatory body in Britain today misuses its influence to advance progressive causes. A welcome exception is the Financial Conduct Authority, which last week decided to allow firms to choose whether they use sex or gender as the definition of ‘woman’ for reporting on their representation on corporate boards. It is clearly not the role of a financial services regulator to attempt to define ‘man’ and ‘woman’. Out of 540 responses to a consultation on the matter, all but one said they did not want trans women to be automatically included in the targets and data. As the group Sex Matters has pointed out, there is

Any Conservative who doubts that Labour’s promise to abolish non-dom status could seriously damage the government needs to look at the fate of Rishi Sunak. So recently the heir apparent to the Tory leadership, Sunak has this week plunged to bottom in a poll of the most popular cabinet members. It comes, of course, just a couple of weeks after the revelation that Sunak’s wife was living in Britain as a non-dom – a status which according to one estimate could have saved her up to £20 million in tax over the years. And this was a poll of Conservative party members, so goodness knows how much the revelation has