Utopia, you are standing in it!

The new Government is clearly in an almighty mess, but I’ll leave the political commentary to others. Here are some thoughts on the economics and the markets.

Let’s start by summarising what went wrong. The tipping point was the mini-Budget in September. The mistake here was not the Energy Price Guarantee, or the cancellation of the increases in National Insurance and Corporation Tax. After all, these measures had already been discounted by the markets. It was not even the absence of the usual OBR analysis. That omission was not a surprise, either.

Instead, investors were spooked by the unexpected announcements of the additional cuts in income taxes, and by Kwasi Kwarteng’s apparent doubling down on tax cuts on Sunday, despite the markets’ obvious and growing concerns about fiscal credibility.

It is just about conceivable that this storm could have passed. Many independent economic commentators initially welcomed the broad thrust of…

On August 11, 1586, after being implicated in the Babington Plot, Queen Mary I was arrested while out riding and taken to Tixall Hall in Staffordshire. In a successful attempt to entrap her, Walsingham had deliberately arranged for Mary’s letters to be smuggled out of Chartley. Mary was misled into thinking her letters were secure, while in reality they were deciphered and read by Walsingham. From these letters it was clear that Mary had sanctioned the attempted assassination of Elizabeth. Mary was moved to Fotheringhay Castle in a four-day journey ending on September 25.

On October 14, she was put on trial for treason under the Act for the Queen’s Safety before a court of 36 noblemen, including Cecil, Shrewsbury, and Walsingham.

Spirited in her defence, Mary denied the charges. She told her triers, “Look to your consciences and remember that the theatre of the whole world is wider than…

The Battle of Hastings was fought on October 14, 1066 between the Norman-French army of William II, Duke of Normandy, and an English army under the Anglo-Saxon King Harold II Godwinson, beginning the Norman conquest of England. It took place approximately 7 mi (11 km) northwest of Hastings, close to the present-day town of Battle, East Sussex, and was a decisive Norman victory. Senlac Hill (or Senlac Ridge) is the generally accepted location in which Harold Godwinson deployed his army for the Battle of Hastings. It is located near what is now the town of Battle, East Sussex.

The background to the battle was the death of the childless King Edward the Confessor in January 1066, which set up a succession struggle between several claimants to his throne. Harold Godwinson was elected by the Witan Council and crowned king shortly after Edward’s death, but faced invasions by William, his own…

As we head into Halloween, and the coming lapse of the Government’s Emergency Powers, the Covid Ghoul of the last two and half years has re-emerged with the same siren call to wanting the powers to paralyse everyone with masks and restrictions.

What I do think we need is that we have a system that when the risk of infection rises we have the equivalent of an alert level system that describes the level of risk in a way that people really understand.

We have alert level systems for fires, for earthquakes, for all these other threats. I think we need one again for the pandemic.

Michael Baker

You’d think Michael Baker would realise that in a sane world his time should be over. No one wants to hear about Covid Alert Systems and…

Regular readers will recall that since June I’ve been on the trail of events surrounding the appointment of Rodger Finlay as, first, a “transitional board” member (attending actual Board meetings) and then a full Reserve Bank Board member, at the same time that he was chair of NZ Post, the majority owner of Kiwibank, an entity subject to Reserve Bank prudential regulation and supervision. From 1 July, the new Reserve Bank Board had legal responsibility for all the powers the Reserve Bank had on prudential policy and implementation. Finlay’s term as NZ Post chair was due to expire on 30 June, but processes were in train that saw Cabinet reappoint him on 13 June.

The most recent post was here. The story gets a little complicated, and there have been various documents (from the Minister of Finance and from The Treasury), and comments from the Minister or his office…

Rocketing power prices is one inevitable consequence of the so-called ‘inevitable’ wind and solar transition. Germans know it, so do Californians, South Australians and Danes. Brits are learning fast, too.

Of course, the propaganda units that run cover for renewable energy rent seekers pretend otherwise. Francis Menton wades through their dross to reveal what Europe’s erstwhile power consumers are now living with, on a daily basis.

Cost Of The Green Energy Transition: Who You Gonna Believe, Some Research Assistants From Oxford Or Your Lyin’ Eyes?
Manhattan Contrarian
Francis Menton
16 September 2022

Over in Europe, and particularly in those countries in the vanguard of the green energy transition, the enormous costs of this folly have begun to hit home. In the UK, average annual consumer energy bills were scheduled to rise as of October 1 to £3549/year, from only £1138/year just a year ago. (The figure may now get reduced…

Edward VI (October 12, 1537 – July 6, 1553) was King of England and Ireland from January 28, 1547 until his death on July 6, 1553.

Edward was born on October 12, 1537 in his mother’s room inside Hampton Court Palace, in Middlesex. He was the son of King Henry VIII by his third wife, Jane Seymour. Throughout the realm, the people greeted the birth of a male heir, “whom we hungered for so long”, with joy and relief. Te Deums were sung in churches, bonfires lit, and “their was shott at the Tower that night above two thousand gonnes”.

Queen Jane, appearing to recover quickly from the birth, sent out personally signed letters announcing the birth of “a Prince, conceived in most lawful matrimony between my Lord the King’s Majesty and us”.

Edward was christened on October 15, with his half-sisters, the 21-year-old Lady Mary as godmother and the…

In my post yesterday I noted in passing that the Reserve Bank Board’s Annual Report had made no mention of their decision to recommend during the year the reappointment of two external MPC members (Bob Buckle and Peter Harris), notwithstanding the huge issues there appeared to be (inflation, and large monetary losses) around the handling of monetary policy. Perhaps it made sense to reappoint them, but the Board gave the public no sense of their reasoning or of what effort they had made to understand the contributions Messrs Buckle and Harris had made. Perhaps, after all, they had fought valiantly but fruitlessly to hold back the Governor’s excesses? (ok, just kidding, but you never quite know).

And then I remembered that months ago I had lodged an Official Information Act request with the Minister of Finance

and had not done anything with the response I had received in June.

There…