OT Tax cut madness

[ramAnag]

£1 = $ 1.11. best (or worst) exchange rate since I left bermuda with dollars in my pocket 37 years ago

$1.11...if only! It’s $1.03 now isn’t it?
So...putting aside our differences and accepting your much greater knowledge of all things economic...WTF is going on and is this anything other than Truss and Kwarteng doing as much damage in as short a time as possible? Why? What’s the ‘endgame’.

[Trickytreesreds]

$1.11...if only! It’s $1.03 now isn’t it?
So...putting aside our differences and accepting your much greater knowledge of all things economic...WTF is going on and is this anything other than Truss and Kwarteng doing as much damage in as short a time as possible? Why? What’s the ‘endgame’.

They certainly haven't helped, but you do need to look fourther then the 2 clowns.

"If a sense of crisis about the world economy were to emerge, the USD could jump significantly."

The euro fell to fresh 20-year lows versus the greenback amid growing recession fears linked to the war in Ukraine and in the wake of Italy's elections that will see a far-right leader become the country's new PM.

The Japanese yen was among other currencies in focus.

The trouble for both the UK and Europe more generally is that weak currencies raise dollar denominated import costs, potentially fuelling inflation further.

[Geoff Parkstone]

$1.11...if only! It’s $1.03 now isn’t it?
So...putting aside our differences and accepting your much greater knowledge of all things economic...WTF is going on and is this anything other than Truss and Kwarteng doing as much damage in as short a time as possible? Why? What’s the ‘endgame’.

No, 1.074 as I write. You may be looking at the rates to deal at Sainsbury for small bundles, where the but-sell spread is much broader.

[ramAnag]

The trouble for both the UK and Europe more generally is that weak currencies raise dollar denominated import costs, potentially fuelling inflation further.

I think we all understand that, Tricky...even if I don’t understand GP’s reply...still

My question, to GP especially, is still...what is going on? Since Truss became PM and immediately appointed Kwarteng as Chancellor everything has played second fiddle to the Queen’s death and now to the Party Conference season.
They had time to think things through (although footage of the Chancellor in Westminster Abbey was bizarre) but have now implemented a strategy that has seen the £ spiral in a record breaking way that has dismayed even those who actually understand the finer points of economic strategy.
All ‘Crazy’ seems to say is, ‘As you know I don’t comment on the currency market’.
Well perhaps he duckin’ should seeing as all the money people will eventually get back in tax cuts will have long gone, as you say, via the increases in ‘dollar denominated import costs’ eg...oil!

[MadAmster]

£ against the $ fell to $1.04 overnight but has "recovered" to 1.07 this morning so far. £ to € is €1.11.

Imports will be dearer. I'll get more £ for my € on trips back although 1/3 of my income will be slightly reduced to "compensate" that "bonus".

Apparently "KamiKwasi" has said, over the weekend that there are more tax cuts in the pipeline. That will almost certainly entail even more borrowing by HMG and drive the £ even lower against other currencies.

They've either gone 100% doolalley or they are determined to do everything in their power to lose the next election, whenever that is. Failing that, they've done both.

If any "normal person" looks at the past few months where first one Chancellor took cash from the energy and oil companies but gave them even more back in tax breaks a couple of years down the road and then a 2nd Chancellor took £150Bn off them but promised them that the good old British taxpayer would give that back to them over the next 15 to 20 years, how on Earth could they possibly vote Toraidh at the next election?

If the Lib Dems were to promise to reverse those give backs, they might actually get in. If the Red Toraidh did it, I'm not sure anybody would believe them. That, IMO, is the sad state of UK Politics at the moment.

[Geoff Parkstone]

Last paragraph spot on MA. Libdem have no credibility, Labour still cannot be trusted and the new Tories would appear to have neither.

Makes us all want Boris back, eh?

[MadAmster]

Not quite that desperate GP but it does make you think May/Cameron/Major would be extremely acceptable right now..... and I am far from being a Toraidh (red or blue variety) supporter as you all well know.

[Trickytreesreds]

Not quite that desperate GP but it does make you think May/Cameron/Major would be extremely acceptable right now..... and I am far from being a Toraidh (red or blue variety) supporter as you all well know.

Definitely not May. Despite the liar being a back stabber, anyone who dances like her, has to be deranged

[MadAmster]

KamiKwasi - asset stripping en masse knowing they are gonna be voted out.
There cannot be an economics expert worth their salt who would approve what Kwarteng did on Friday.

That he worked in the banking sector as an adviser prior to politics tells us he's not naive and that it's a deliberate act.

They've mooted more tax cuts on the way. Probably for the top 5% again. More borrowing to fund them?

First Sunak puts a windfall tax in place taking money off the obscene profits of the energy and oil companies. He then gives them tax breaks in the near future which will more than offset what he took in tax. Now we get Windfall round 2 in which Kamikwasi and Thick Lizzy take £150Bn off them but promise that taxpayers will pay them back over the next 15 to 20 years. The companies got those obscene profit levels completely by accident. I'd take the £150Bn and leave it at that. However, I would ensure that, should they be hit by circumstances beyond their control whereby they make a huge loss, there should be some form of compensation for them. PS - with inflation as high as it is will the Toraidh again dump the triple lock on pensions? They probably will but if companies can get to keep extra profits they didn't "earn" but by accident of circumstance, why can't pensioners get the rise indicated by the triple lock?

Is there no end to their skullduggery?

[Geoff Parkstone]

KamiKwasi - asset stripping en masse knowing they are gonna be voted out.
There cannot be an economics expert worth their salt who would approve what Kwarteng did on Friday.

That he worked in the banking sector as an adviser prior to politics tells us he's not naive and that it's a deliberate act.

They've mooted more tax cuts on the way. Probably for the top 5% again. More borrowing to fund them?

First Sunak puts a windfall tax in place taking money off the obscene profits of the energy and oil companies. He then gives them tax breaks in the near future which will more than offset what he took in tax. Now we get Windfall round 2 in which Kamikwasi and Thick Lizzy take £150Bn off them but promise that taxpayers will pay them back over the next 15 to 20 years. The companies got those obscene profit levels completely by accident. I'd take the £150Bn and leave it at that. However, I would ensure that, should they be hit by circumstances beyond their control whereby they make a huge loss, there should be some form of compensation for them. PS - with inflation as high as it is will the Toraidh again dump the triple lock on pensions? They probably will but if companies can get to keep extra profits they didn't "earn" but by accident of circumstance, why can't pensioners get the rise indicated by the triple lock?

Is there no end to their skullduggery?

I've struggled to find a single redeeming feature in that budget. It's aimed at creating growth, hence employment, hence improving the tax take and cutting the benefits bill longer term.... and thus increase productivity and exports maybe.

Bit all I see is rising prices falling currency rates and a dark tunnel. The triple lick looks doomed again I suspect.

If I had rA's mindset I'd blame it all on Brexit, and undoubtedly there is an element of blame to be laid at that door, but essentially a problem driven by wider issues as all economies are suffering. But I don't see many countries cutting tax for high earners as a solution