Has crypto finally had its day?

If you run an organisation, there are some reporters you definitely don’t want around: Ronan Farrow asking for comment; Madison Marriage or Dan McCrum with a couple of questions; Michael Wolff hanging out on a sofa taking notes. Michael Lewis is not one of those reporters. If he wants to spend time with you, you are about to be lionised as a decent person who sees just a bit more clearly than the fools who run the system of which you are a part, which will make you wildly rich (unless you’re an academic or a public servant) and famous. When Michael Lewis calls, people answer. Lewis raises enough questions


Does the ‘anti-growth coalition’ run the Treasury?

‘Permanent revolution’ is the on dit in Whitehall these days – and what it means is that the Truss administration U-turns so often the whole machinery of government is constantly spinning round on its axis. The latest volte-face is the decision to appoint James Bowler, a 20-year establishment veteran, as Permanent Secretary to the Treasury. The Chancellor, Kwasi Kwarteng, declared himself ‘delighted to welcome James back to the Treasury,’ which is causing a few chuckles in SW1. The joke in Westminster today is apparently that the anti-growth coalition actually runs the Treasury It’s well-known that Kwarteng’s plan was to shake up the Treasury. Bowler represents precisely the sort of orthodox

Bernard Looney shows why every board should be braced for scandal

Bernard Looney, the fallen BP chief, always had a certain swagger about him. I’ve no idea whether he was unsafe in taxis, but he was certainly prone to unguarded remarks. ‘Not every barrel of oil in the world will get produced’ was a bold way, back in 2018, to introduce BP shareholders to the idea that the world’s energy giants will one day have to strand remaining carbon assets if they really intend to achieve net-zero targets. ‘This is literally a cash machine’ was not the best way to describe BP’s profit performance in November 2021, when British households were beginning to feel the pain of soaring energy bills. And

Kate Andrews

How far will Truss’s ‘growth plan’ go?

It was only a few weeks ago that Liz Truss was talking about holding an ‘emergency’ fiscal event towards the end of September, mainly to address rising energy bills and how the government would support people through the winter. This targeted approach helped to justify the speed at which her new government would announce some major policy, and even more importantly was used to justify not commissioning analysis from the Office for Budget Responsibility to go alongside it. Energy bills were too time sensitive for the government to wait for the OBR to run all the numbers and produce forecasts, Team Truss’s argument went. The independent assessment of her plans (which must

Where were the longest A&E waits?

The bare platform A 112-space car park built to serve the railway station in the Cambridgeshire village of Manea was used by just three cars in its first week. — The station, formerly a ghost station with one train a week, has been revived but even so is only served by two trains every hour. — Yet had it not been for the Civil War, it could have been the capital of England. Charles I planned an English Versailles there, surrounded by a great city called Charlemont – all built on land reclaimed from the fens. Thanks to the war, however, nothing ever got built. — The name Charlemont lives on

Will Brits feel richer if inflation halves?

The government’s objective to ‘halve inflation’ by the end of the year seems to be back on track – for now. Last week’s interest rate hike was delivered with an updated inflation forecast from the Bank of England, showing the rate slowing to 4.7 per cent by the end of the year, just below Rishi Sunak’s target. The better-than-expected fall in the headline rate last month has forecasters thinking things are finally moving in the right direction. As Ross Clark reports on Coffee House, Capital Economics is expecting another major fall in the rate next week – down to 6.9 per cent on the year – when July’s figures are released.

How to increase your home’s value – with a sandwich

It is a tenet of neo-liberal economics that there is no such thing as a free lunch. This is obvious baloney. There are free lunches everywhere. The problem is that those free lunches are no longer served to people doing useful work. They are instead handed out to the owners of a few favoured asset classes through untaxed gains. We have created far more tax breaks for rent-seeking than for productive work… and then we wonder why Britain has a productivity crisis. Under a future Sutherland regime, there would be no tax paid on beer drunk in a pub I must admit I enjoy a few free lunches myself –

Russia’s complex relationship with the ruble

The most impressive banknote I have ever seen is the 500 ruble note produced by the Imperial Bank of Russia between 1905 and 1912. About four times the size of a modern £50 note, it is magnificently emblazoned with a portrait of Peter the Great and a profusion of cupids and classical pillars. It looks as high-denomination money should look – luxuriant, confidence-inspiring and valuable. The ruble (from ‘rubit’, to chop) was originally a chopped-off piece of Viking silver ingot Appearances can, of course, be deceptive. My Russian wife’s great-great-grand-father, the owner of the Volga Bread Bank of Saratov, unwisely chose to keep his considerable savings in the form of

Britain could come to regret moving away from China

China’s relationship with America is getting worse and worse. The Chinese Foreign Minister, Qin Gang, warned yesterday that ‘containment and suppression will not make America great. It will not stop the rejuvenation of China’. The Biden administration, meanwhile, recently accused China of readying to send weapons to Russia, and Americans are still fuming about the Chinese balloon that entered their airspace. China thinks they’re being hysterical. Britain will soon be forced to decide whether it will decouple from China. The Americans no doubt want Britain to join them in cutting ties to Beijing, but it is not clear that British policymakers are ready to do this yet. In 2020, China accounted for

Liz Truss: my part in her downfall

Now that the final curtain has fallen on Liz Truss’s brief and tumultuous premiership, it is time for reflection. A chance to set the record straight and also to own up to mistakes – especially for those of us who tried to advise her. What went wrong? Yes, the tipping point was Kwasi Kwarteng’s mini-Budget. But three problems were by then already brewing. First, the leadership campaign over the summer had become very focused on tax cuts. Even Rishi Sunak ended up saying he would cut the basic rate of income tax from 20 per cent to 16 per cent by the end of the next parliament, while Jeremy Hunt

These figures show the enormity of the next PM’s task

Next week we will have a new prime minister (again), but the economic problems facing the country will remain the same. This morning’s update from the Office of National Statistics shows public sector net borrowing was  £20 billion last month: the second-highest borrowing September record and significantly higher than the Office for Budget Responsibility’s last forecast, which put the figure close to £15 billion. It’s this rapid rise in borrowing that the markets have turned on in recent weeks Economists thought borrowing would rise, but even the consensus (roughly £17 billion) was lower than what the government borrowed in practice. While total borrowing for the financial year is slightly below

Can you feel sorry for Liz Truss?

It is not easy to feel sorry for Liz Truss. She has a deeply unattractive streak of vanity – when in the Foreign Office, she seemed more interested in posing for the official photographers who trailed her round than she did in building relationships with the places she visited. She campaigned hard and sometimes dirty to obtain a job for which she was manifestly out of her depth. Once in that job, she exercised power with peremptory arrogance. She rewarded people who had sucked up to her, cast out anyone who had spoken up for her rival, and allowed experienced civil servants to be hoofed ruthlessly out of their jobs.

Truss says no to spending cuts. Here’s the caveat

The mini-Budget was a spending spree. The ‘medium-term fiscal plan’ was meant to explain the funding. But what exactly is going to be in it?  Liz Truss and Kwasi Kwarteng were thought to have (finally) come to terms with the need to address the need for some restraint, after their mini-Budget led to market chaos which is yet to settle. Their fiscal statement – in other words, how they would fund their tax cuts – was moved forward by almost a month, to 31 October. Its contents were thought to include some major spending cuts, in a bid to convince markets that fiscal discipline still guides the Tory party. If there are

Kwasi Kwarteng’s easy ride

Tory MPs were in an anxious mood as they returned to the Commons this afternoon after weeks of conference recess and government meltdown. Their first session in parliament was, appropriately enough, Treasury questions, where they had a chance to air some of their anxieties with the Chancellor and his team. It could have been a much worse session for Kwasi Kwarteng, given the way things have gone recently. But the number of MPs seeking reassurance won’t have left him feeling very relaxed. Kwarteng told the Commons that his mini-Budget had been ‘really strong’ Kwarteng told the Commons that his mini-Budget had been ‘really strong’ and that MPs constituents would have

What crisis? A tough week for Trussonomics

What’s the sign of a successful Budget? Chris Philp, the new chief secretary to the Treasury, gave his answer moments after Chancellor Kwasi Kwarteng’s statement last Friday: a strong pound. ‘Great to see sterling strengthening on the back of the new UK growth plan,’ he tweeted out. A (temporary) rising pound made sense to Truss supporters, who argued that markets would support their transition to a lower-tax, higher-growth economy. This was, they thought, their vindicating moment. The moment didn’t last. Within minutes, the pound had entered a steep descent and UK borrowing costs surged. But Kwarteng is not a politician who panics. Instead of staying in the office and trying

Will Liz Truss take on the IMF?

Tonight the International Monetary Fund has weighed in on the UK’s mini-Budget, offering a direct rebuke of Liz Truss and Kwasi Kwarteng’s tax cuts. ‘We are closely monitoring recent economic developments in the UK and are engaged with the authorities,’ its spokesperson said, in reference to the fluctuating pound and rising borrowing costs. ‘Given elevated inflation pressures in many countries, including the UK, we do not recommend large and untargeted fiscal packages at this juncture’ – suggesting some concern that the measures could be inflationary. The IMF seems more frustrated with the ethics of the policies rather than their economic impact It’s the kind of intervention that does little to

Why football needs a regulator

Plans by the government to introduce a regulator to the football industry – endorsed by all Westminster parties just a year ago – have, to use jargon oddly appropriate in this case, been ‘kicked into the long grass’. Truss is instinctively against regulating almost anything. When I asked her about the ‘fan-led’ Crouch Report on the campaign trail a few weeks back, she replied, not very cryptically, that she would apply a ‘very high bar’ to any new types of regulation. So, the news that the legislation has been paused is no great surprise to me. The Premier League has, in effect, largely become a closed shop of the 20

Can the Bank of England inspire confidence?

It has dawned on the government that last week’s mini-Budget might have been a bit too one-sided: £70 billion worth of extra borrowing and not a single mention of spending cuts or efficiency gains has seen borrowing costs spike (up by 0.3 per cent just today). As James Forsyth reports on Coffee House, this afternoon’s announcement that a ‘medium term fiscal plan’ will be announced next month is an attempt by the Treasury to reassure markets – and convince them that fiscal responsibility has not totally disappeared from this government’s agenda. Emphasis is being placed on previous promises to make sure debt falls as a percentage of GDP in the

How worrying is the falling pound?

How are markets responding to Kwasi Kwarteng’s mini-Budget? A sharp fall in the pound today has plenty of critics arguing that the tax-slashing announcements have already proved a failure. Sterling fell this afternoon to $1.09, bringing the currency to another 37-year low against the dollar. This is more than a 3 per cent dip in just one day. The euro took a hit too, but a smaller one at 1.5 per cent. It’s difficult to separate this new record low from today’s announcements – but also near impossible to draw direct correlation, as the pound and euro have both been in freefall against the dollar for weeks now. With the

Kwarteng axes top Treasury civil servant

Liz Truss’s shake-up of Whitehall continues. Her Chancellor Kwasi Kwarteng has sacked Tom Scholar as permanent secretary to the Treasury – with the Cabinet Secretary to begin the recruitment process to find his successor. Announcing the news in a government press release, Scholar made clear the decision was made by Kwarteng: ‘The Chancellor decided it was time for new leadership at the Treasury, and so I will be leaving with immediate effect’. What message does it send to the markets? There’s a risk that it suggests turbulence The new Chancellor did at least offer some parting words of praise – describing Scholar as ‘a dedicated and exceptional civil servant’ who had provided