Matthew Lynn is a financial columnist and author of ‘Bust: Greece, The Euro and The Sovereign Debt Crisis’ and ‘The Long Depression: The Slump of 2008 to 2031’
There are not that many advantages to electing a former investment banker as president. They are often aloof. They don’t have much in the way of a common touch. And they have a sense of entitlement that blinds them to their failings. There is, however, always this to make up for all that. They know
It is finally here. Die-hard European Union federalists have plotted for it for years. Economists and thinks tanks have argued for it. The Greeks and Italians have pleaded for it. And French presidents have made no end of grand speeches, full of references to solidarity and common visions, proposing it. The Germans have finally relented
So far, so good: the Oxford university trials on a potential vaccine for Covid-19 is reported to be going well. It has been tested on more than a thousand people, and it looks to be safe. There is another, more important question, however, and one where an answer might take a frustratingly long time. Does
Who are we kidding? If you are still furloughed through July, August, and September, the chances are that your job isn’t on hold as you wait for lockdown to gradually be lifted or for your company to get back to normal levels of demand. In truth, you have probably been fired. It’s just that no
An epidemic has been raging across the continent. The economy is in lockdown, and GDP is in freefall. But, hey, just when you thought things couldn’t get any worse in the eurozone it now has a financial and currency crisis as well, and one that is being made worse by the week with the shambolic
British Airways is laying off 12,000 staff. Virgin Atlantic is desperately looking for a buyer. Air France-KLM is being bailed out by the French and Dutch governments, Lufthansa is getting rid of planes, and Airbus is furloughing workers. The once mighty airline industry is in terminal trouble, with massive state support now required to keep
You can get 80 per cent of your salary, and sometimes even 100 per cent, without actually working. Companies are getting virtually free loans, and can dump their often troublesome staff on the Treasury payroll, and entrepreneurs can get direct injections of cash from the state without actually having to launch any products. Sure we
Emmanuel Macron is, for all his carefully polished image as a radical moderniser (and with the possible exception of not having multiple mistresses), a very traditional French president. He protects domestic industries, especially if they happen to manufacture cars or guns. He subsidises farmers, sends soldiers to small African states, and accumulates more and more
Italy’s hospitals have been overwhelmed. Its mortality rate is among the highest in the world. Its economy has cratered, its bond yields have soared. And it is starting to drown under the weight of its accumulated debts. But, hey, at least the EU commission president Ursula von der Leyen feels sorry about the way Italy has
Solidarity will be strengthened. Countries will find new ways to co-operate. And Brussels will support the economy, making sure the strong support the weak. European Commission president Ursula von der Leyen is set to unveil the EU’s response to the coronavirus crisis, promising a ‘new Marshall Plan’ to prevent the continent plunging into deep recession. It
Ten billion here. Twenty billion there. At least we now know where Rishi Sunak is getting all the money from. As of today, the Bank of England has quietly started directly financing the government. Instead of selling gilts to fund the difference between what it raises in taxes and what it spends the Bank is
In some ways we will miss John McDonnell. His reheated 1970s student union Trotskyism was always an easy target for a column. From free broadband, to nationalising great swathes of industry, to raising taxes to punitive levels, and banning just abut anything he disapproved of, he managed to come up with a constant stream of
Rising death rates. Economies closing down. People forced to stay at home. The coronavirus is a health, social and economic emergency for every country where it hits. But in Europe it has also mutated very quickly into something else as well, and which, while it may not be quite so threatening in the short-term, could
Ten billion? Twenty billion? Thirty billion? To borrow a phrase from the American senator Everett Dirksen when scrutinising the escalating costs of the military, ‘pretty soon you are talking about real money.’ Chancellor Rishi Sunak has already thrown huge sums of money at rescuing the economy. He may well spend a lot more over the
It will be impossible to calculate. There will be widespread fraud. And there is no mechanism for sending out the money. As the Chancellor Rishi Sunak scratches around for ways to bail out the UK’s five million self-employed in the same way he has done for employees he faces plenty of obstacles. No doubt his Treasury
At least no one can say it isn’t bold. The United States is fiddling around with some possible cuts to payroll taxes. Most of Europe is stuck with some printed money from the ECB. But the UK is embarking on one of the most radical experiments in modern economic theory, and one that will no
A £330 billion package of loans to business. A huge tax break to any company in the hospitality or leisure industry. Mortgage holidays to anyone who has been impacted by the coronavirus. People can accuse the Government of being behind the curve on delaying the spread of Covid-19 through the population. But it is hard
A dramatic dawn cut in interest rates. A huge blast of public spending. And immediate cash help for companies that might find themselves temporarily in trouble as their customers stay at home and staff call in sick. We will find out over the next few weeks whether the British government has done enough to fight
It is too expensive. It mostly goes to Southerners who already have plenty of money. And it doesn’t even work very well, while the money would be better spent elsewhere. As the Chancellor puts the finishing touches to his Budget, the leaks suggest that the most generous tax relief for entrepreneurs will either be curbed,
Supply chains are shutting down. Factories and offices are closing. Flights are being cancelled, conferences postponed and football and rugby games rescheduled. It remains to be seen how much of a blow the spread of the coronavirus turns into for the global economy. But one thing is now certain: it is going to lead to
