Well are we on home strait for World Cup bid?

Whenever I read about our World Cup bid (a bit of a misnomer because we are not prepared to pay the commissions required) I am always amazed about the news management we put up with in the UK. Last night both the ITV and the BBC interviewed David Beckham, who was upbeat about the bid, without mentioning the fact that the Russians were favourites with the Spanish/Portuguese. Although there would be different time zones, which would probably affect television coverage, I am quite happy for the competition to go to Russia. We have already got the white elephant of the 2012 Olympics, where I suppose there will be the benefits of opening up a part of East London and of West Ham moving to a new ground.

The main advantage for our World Cup bid is that we have the stadia in place such as
Wembley, Old Trafford and the Emirates. There would not be major distances for fans to travel and there would be the added bonus of our football yobs not having to travel abroad. I suppose this will all be irrelevant after the BBC's Panorama programme on FIFA.

If we did not get the 2018 competition, at least we would avoid the embarrassment of England being knocked out in the qualifying round. With the Premier League you could not set up a more inimical structure to the interests of the national team. How many
domestic players get picked for Arsenal?

David Cameron and his vanity staff!!

There are claims that British Prime Minister David Cameron used the announcement of the royal wedding to bury the "bad news" that his personal photographer and his wife's stylist would not be going on the government payroll after all. I don't believe these claims at all but the proposed appointments did show an unhealthy interest in media management. Well, at least we have got the new term "vanity staff" in the UK political language.

What is perhaps more worrying is the pressure on the BBC to delay a Panorama programme on the World Cup bidding process because it would annoy FIFA. I think the
BBC's independence should be cherished more than winning the right to host the
World Cup.

David Cameron in Vichy-style surrender? EU budget.

Is Norman Tebbit right in saying that UK prime minister David Cameron is carrying out a French Vichy-style surrender over European Union plans to increase its budget?

Apparently, we have to go along with a 2.9 pct increase compared with a wish of 6 pct. This does not sit well with benefit cuts in Britain. Maybe Mr Cameron is being patient because the Eurozone could collapse soon thwarting the attempts by German and French banks to pass on their losses on government bonds from countries like Greece to European taxpayers.

David Cameron is not the only Euro leader having difficulties. Some 11 member countries are not overly impressed by German chancellor Angela Merkel's idea for
profligate countries to temporarily lose their voting rights.

I think I have said previously we, the UK, have to be in the Euro game to win it. A bit of intelligence might get what we want rather than implacable opposition. I suppose it is difficult to go to these Euro summits, if you are always portrayed as the trouble maker, although Lady Thatcher did not mind and some of our Euro partners
did hide behind her skirts.
If I was Cameron, I would suggest that the EU Commission should relocate out of Brussels and Strasbourg to a cheaper location such as Vilnius or Riga. This would avoid the scandal of Baroness Ashton taking up very expensive office space in Brussels for her Euro diplomatic corp. I am sure you could have a purpose-built Euro village in Latvia for not too much money.

Cameron could also propose that European Commission president Jose Manuel Barroso, such a talented politician, should go back to Portugal and help sort out the political/economic mess there. Obviously, these things would not happen but it might prove a reality check for the Eurocrats. Barroso wants the full 6 pct rise in the budget. I remember even the hapless John Major easily blocking a Belgian candidate for an Euro post.

Apparently the UK has secured a more stable rating.

One of the credit rating agencies considers that the rating of the United Kingdom economy is more secure following the public spending review of George Osborne, where
spending is going up in nominal terms. However, quite a few domestic commentators are concerned about the widening gap between north and south. There is the argument that if the regions did not create many private sector jobs when things were good, then they are unlikely to do so after public sector job losses.

If the public sector job losses are decided by the bureaucrats, then they will be safe and front-line services will be hit. My health services have already been affected and the NHS is supposed to be safe with the Coalition government! In the Greater London area Enfield and Sidcup, A&E services are to be "reconfigured". Just hope the ambulances can go faster to reach their longer destinations in time.

In the "New Statesman" US-based economist Danny Blanchflower is pretty scathing about the economic experiment of George Osborne but the recent quarterly GDP figure of 0.8 pct growth is not bad and maybe the British economy might be lucky. However,
lifting exports is going to be hard with such an unbalanced economy.

UK chancellor George Osborne gambles our future - papers.

I have been reading quite a few of the commentaries on the public spending review announced by UK chancellor George Osborne published in the newspapers today. Quite a few make the point that in nominal terms public spending will still go up while others say that Osborne is gambling that the net drain on disposable incomes in Great Britain (with the onslaught on welfare bills) will be offset by new private sector jobs.

His figures do not really add up. I doubt if the government will cut welfare fraud by
£5bn and I doubt that a new aircraft carrier will actually cost £7bn. I suppose there will be more spending cuts and tax increases down the line.

Will UK spending cuts work??

I wonder if the UK public sector spending cuts will actually work? Chancellor George Osborne highlighted the various elements of the £83bn package yet at the same time the Bank of England is considering printing more money (quantitative easing) to get the economy moving. I suppose it makes some kind of sense to build an aircraft carrier with no planes and launch a money saving assault against the disabled classes. But I was more impressed with the Irish government, which pushed through pay cuts for the country's public sector.

If the massive public sector pension liabilities are true, then the imperative is to cut more than the possible 500,000 jobs, which won't be fun. The jobs are to go over four years and Mr Osborne hopes most of the strain will be taken by natural wastage.
A hope in vain I am afraid.

In the early 1990s the Tory administration got rid of a major budget deficit without scaring everybody to death. It took a few years but it allowed my old friend Gordon Brown to go on the splurge later, since he inherited such a good fiscal situation. Any improvement in the public finances will take time. I don't think private job creation will be enough to offset the public sector job losses. Together with quite
a few of the disability living allowance and incapacity claimants moving to other benefits, then you could increase the British unemployment total by a cool one million without breaking sweat.

The end of the Wayne Rooney dream at Man Utd!!

After turning Wayne Rooney into a global superstar, Manchester United have decided not to stump up an increase in wages. Apparently, Rooney wanted something in the range of Cristiano Ronaldo's £11m plus a year compared with his current £5.3m.
(I have not got the details of the contracts!!). Man Utd are a selling club and there was the background fear that the American owners would want to cash in on their main asset. However, it looks like Rooney wanted to leave the club anyway, which is a shame since the fans always roared when he started to run against defences.

Real Madrid tried to win things with a bunch of global superstars but these players need others in the team to win the ball and pass to them. Even without Rooney, Man Utd can score enough goals but need a stronger midfield to give the defence a bit more protection. Giggs and Scholes can't go forever and the Euro loss against Bayern Munich showed that major investment/surgery was needed.

PS. As we now know our Wayne is staying at Man Utd on a major increase in pay. He is not as quick as he used to be.

In Great Britain: The squeezed middle classes.

The reduction in children benefits and the increase in university tuition fees will hit middle England hard. I suppose they did not expect this to happen when they voted in a Coalition government (sorry my joke). It looks like we have moved to a U.S style private market system for university education but we have had no transitional period to adjust to this. The British government is eliminating children trust funds and so there are no secure long-term investment programmes to help hard-pressed families finance higher education if the state refuses to do so.
I invested in one of thoe investment schemes for children marketed by one of the major financial services groups and it has been very volatile in terms of
performance. One minute it was doing quite well then it halved. That is equity performance for you!

The universities themselves are not financially strong enough to offer reasonable bursaries and I am sure the government will still want to control these institiutions whatever happens. I saw Lord Browne defend his report last night on the BBC web but just raising university fees without any commitment towards improved teaching or research did not make a lot of sense to me. I suppose he hopes that market forces will work towards improvements.

The elite universities will become more elite in terms of student composition and the trend to increase the number of non-EU students will continue. I wonder if Vince Cable had that in mind when he took over his ministerial brief. The Lib-Dem politician has at least admitted to the fact that he benefitted from a free university education.

Was it the banana that did it for David Miliband?

I suppose it is too early to comment on Ed Miliband.

The new leader of the British Labour party, Ed Miliband, says he is not going to squeeze the country's middle class but who is going to believe him? The current coalition government seems to have a few tax-raising initiatives of its own. There is the possibility that HMRC wants to take central control of payrolls so as to deduct
income tax and national insurance and then send the remaining amount to your bank account. Is this Stalinism or Conservatism? I don't know if Tory voters knew this would be in the pipeline when they voted for David Cameron. Apparently, the HMRC wants to cut down PAYE errors with people who get multiple payments from different jobs and various pension payments. I think HMRC would need a few more staff and a bigger computer to cope.
To be fair Allister Heath puts it far better than me:
http://www.cityam.com/news-and-analysis/allister-heath/don%E2%80%99t-reward-hmrc%E2%80%99s-massive-failure

Sincere condolences for David Cameron, UK prime minister.

The blog sends its sincere condolences for British Prime Minister David Cameron on the passing of his father in France yesterday.

Football economics defy the laws of gravity!!

The economics surrounding football clubs here in England & Wales and in Europe are perhaps a contradiction in terms. I think the word "economy" is derived from a Greek word for housekeeping. I don't believe Real Madrid was thinking of its profit & loss account when it shelled out a tonne of cash for Kaka and Ronaldo (let's call it £130m for the two players). I hope Man Utd took straight cash rather than the instalment deal it got for Beckham)
I suppose their market values went down following their lacklustre World Cup
performances. Let's hope the Spanish team wins the European Cup so that it can make some return on its investment.

However, in their way stand the mortal enemy FC Barcelona as well as clubs such as Inter Milan and Manchester United. The draw for the next stage of the European Cup is being held in Monaco tonight. The lure of a Wembley final would be pretty big for the four English clubs in the draw. It would be virtually a home fixture for Man Utd and Chelsea. Hopefully the pitch would be sorted out by then.

Apparently, when Tottenham Hotspurbooked their passage last night, the north London team hit a £20m jackpot. For the first time the capital is putting up three contenders for this competition. I have a shameful admission to make. Although a Cockney Red, I am a bit schizophrenic in supporting Spurs about 49 pct of the time. It was good to see Crouch bagging a hat trick but I suppose a tougher European defence would have countered two of those goals. Although we did not get the robot dance, which celebrated those English goals.

The free milk controversy - back to Thatcher!!

It just proves that there is nothing new under the sun with the proposal (personally squashed
by UK Prime Minister David Cameron) that free milk should be withdrawn from under five year old children at educational establishments. It just shows my age that I can remember this type of controversy dogged the old battle axe Margaret Thatcher herself. I know I should not poke fun at the victor of the Falklands War but her economic policies were pretty responsible for the reduced industrial capability of the UK.

It was sad watching a programme of "Top Gear" when Jeremy Clarkson visited the old empty factory, which manufactured the Jensen sports car in West Bromwich and said that we don't manufacture anything anymore in the UK.

I suppose we don't go in for suporting industrial champions but we did rescue Rolls Royce in the 1970s and that was a pretty good move for both the aero-engine maker and for us as a nation. Currently, it is open season for the world class manufacturers we still have in Great Britain and Northern Ireland. Who would have thought a bidding war would have broken out for Chloride!

Will the UK coalition government unravel?

I was watching a BBC interview with Lib Dem MP Simon Hughes yesterday and I was wondering if the UK coalition government will unravel. He made a good job batting away a question about a possible graduate tax but then was asked about the Iraq war.
Perhaps his reply was not helpful to the coalition government but shows up the differences in the administration. Hughes said all Lib Dem MPs thought the war was illegal.

The UK coalition government has to get on with the situation as it is now. The aim must be to extricate our troops from fighting abroad rather than worrying about the illegality of the Iraq war, which is just too late.

It is amazing that the Labour Party is taking so long in selecting a leader, when the coalition government could do with some external rather than internal opposition.
For instance, Andy Burnham should be leading the attack on the government plans for the NHS, which represent quite a gamble.

Tomorrow will see the UK's emergency budget.

Former Tory chancellor Norman Lamont says in today's Daily Telegraph that George Osborne has to be bold in tomorrow's budget so as to make a dent in the public sector deficit. We are certainly being softened up with stories of elimination of tax credits to relatively wealthy families and of civil servants having to contribute more to their generous pensions. However, if we are going to have a welfare system then there should be some universal benefits. Moving the goal posts on public sector pensions will be harder for the government to explain compared with the decimation of private schemes. This was due to the closure of defined benefit pension funds, which was not widely understood by workforces. Factors obviously include the Gordon Brown tax raid but there have been other problems such as the poor performance of equities and the increasing longevity of scheme members. Companies such as British Telecom and British Airways have become pension funds with operational subsidiaries attached.

Politically it will be a tough sell for a group of millionaires to advocate austerity. The Tories can blame Gordon Brown for economic mismanagement but I would not impose policies, which would deliberately increase UK unemployment from 2.25m to 3m. It is alright being critical of the fact that 60 pct of the workforce of the north-east depend on the public sector but it is unlikely the private sector could step in to improve matters.

Some of our problems are European-wide. The wheels are falling off in countries such as Spain and Portugal due to deficit problems, poor educational systems and weak employment formation. Much has been made of the collapse in Spanish property prices but our banks have also become property companies due to the weight of questionable loans to the sector. State pension ages have to be harmonised throughout Europe. However, there is little point us making transfers to the French economy via the Common Agricultural Policy (CAP), if the Frogs can retire at 60 while we have to soldier on until 66 plus.

On a more optimistic note the devaluation of the pound has given us some breathing space. Hopefully, families will be using the low interest rates to cut borrowings. Gilt yields are low so the financial markets are being sanguine about our prospects at the moment.

It is a shame I can't get on a Quango!!

It is a shame I can't get on a Quango especially with the Tory-Lib government committed to cutting down waste. Apparently, there are quangoes to monitor the work of other quangoes!! Maybe that is not true but in the British National Health Service (NHS) the sheer number of these quasi-non-governmental organisations were unable to prevent major negative outcomes at a Staffordshire hospital. I suppose I am not a member of the great and the good or of the politically correct. There was that couple in Scotland, which made an absolute mint by sitting on loads of public sector boards.

Changing the subject you do wonder about our government bosses. Defence Secretary Dr Liam Fox has berated our NATO allies for not pulling their weight in Afghanistan. I think it would make more sense for Fox to start howling when there is a full moon than to expect the Germans and Italians to put any combat troops near trouble zones. If the Canadians can set a timetable for pulling out then we should do the same. There is plenty of anti-British rhetoric coming out of Barack Obama, a bit more would not make any difference. The way he spits out "British Petroleum" maybe we should set up a peace and reconcilliation commission and investigate did we really torture his Grandad in Kenya. Perhaps the Brits should kick up more of a fuss about extraordinary rendition, water-boarding etc.

I miss Gordon Brown!!

I miss the former UK premier Gordon Brown, who is keeping a low profile.
There does not seem to be the same chaos in the internal workings of the government of Great Britain. His successor David Cameron has the herculean task of making a dent in the British public debt mountain. I would have gone for a gradual approach to cutting expenditure given that the UK economy has had the equivalent of a heart attack. Cameron has extolled the "Canadian approach" when there were major education and health cuts. These would be very, very unpopular here and if these areas are ringfenced, then the cuts will be worse for the other departments. I would merge the Foreign Office and International Aid departments, which could produce some cost savings.

Selling austerity will not be an easy task for the Old Etonian club. I thought Brown did well in the last election to play the class card, which ensured that the Labour vote did not completely collapse.

It will be interesting if George Osborne will come up with any surprises in the June 22nd budget. One Daily Telegraph columnist says the Chancellor of Exchequer would not know an economic theory, if it hit him on the head.

My opinion of Andy Burnham has gone up considerably!!

My opinion of Labour cabinet minister Andy Burnham has gone up considerably when he said today that his party lost the general election. I believe the Health Secretary, who supports Everton I think, has shown some sense of reality. His party is the main beneficiary of the first-past-the-post system with each MP taking the equivalent of around 34,000 votes compared with 36,000 for the Tories.

I am surprised by the lack of comment on how Labour can negotiate with the Liberals without a leader. It seems quite a leisurely departure by Gordon Brown. By September, there could no British Airways or British Petroleum or will Brown save the day!!

Is it really a three horse race!!

I have struggled to get excited about the UK general election campaign because in reality it seems to have been going on for so long. It was a surprise Nick Clegg winning the first televised debate but for me even more of a surprise was Gordon Brown campaigning on the economy, which is a pretty poor one. David Cameron has had to change tactics. But
whoever you vote for, I think it is very important that you do vote. I am saddened by the low electoral turnout. Perhaps we should consider a compulsory voting system like in Australia.

I was surprised that so few of the British expat community vote in percentage terms. But this community seems to want the UK government to act on their behalf when things go wwong such as the bulldozing of illegal appartments in southern Spain.

The volcanic ash cloud from Iceland has at least reduced the UK electoral coverage
and some areas around Heathrow must have enjoyed the quiet skies. My nipper says that Kew Gardens was a real treat!

Is it really a three horse race? It would be interesting if the Liberal Democrats really did top the number of votes nationwide and lost out on the first-past-the-post system.

Gilts at just over 4 pct but for how long?

British government bonds or gilts are trading at just over 4 pct but for how long? The Bank of England has artificially distorted the market by buying £200bn worth as part of its quantitative easing (QE) programme. There is now a pause in the gilt buying by the UK central bank but inflation is running at 3 pct and the pound is getting a right kicking in the foreign exchange markets at around $.150.

We have annual public borrowing of £180bn, which is over 12 pct of GDP and the highest per capita level of any big economy.

**** These figures were later revised downwards in the last Darling budget but are still high.

Sorry about the long delay since the last blog!!

I am sorry about the long delay since the last blog, which was perhaps an unfair diatribe (are'nt diatribes always unfair) against British premier Gordon Brown. Since the last blog Brown has survived the Chilcot waffle and a further decline in sterling. It appears Brown was less than transparent about his role as Chancellor of the Exchequer in the funding of defence expenditure. What was obvious was Brown was not going to take the blame for anything.
However, it looks like there could be a double dip recession in the United Kingdom with the rise in VAT to 17.5 pct and the end of the car scrappage scheme. The economy is still in a very fragile state and Brown is perhaps gambling on a return to growth to make a dent into the public sector deficit. Yet the markets fear that if Brown remains as prime minister, he would put Ed Balls as
chancellor.
The message of "blood, sweat and tears" from Tory shadow chancellor George Osborne has not really set Middle England alight. The Conservatives are obviously not going to attract too many seats in the Labour client regions of Scotland and Wales. They have got to win a battle against Lib Dems and Labour in English seats. The Lord Ashcroft affair makes David Cameron look weak.
Whatever party wins the forthcoming UK general election it will have to deal with a
National Health Service (NHS) sliding towards bankruptcy. The primary care trusts or PCTs are already running out of money and still the NHS is more geared towards its employees than its patients.
In London, there are proposals to cut A&E and maternity
services. In the north of the capital all roads seem to lead to the Royal Free at Hampstead with the plans for consolidation/centralisation of services.
There will have to be some real productivity improvements/changes in the NHS. A hard nosed attitude over missed appointments, staff absenteeism and treating tourists for free would make a difference at the margin. Labour has trumpeted its planned increase in NHS expenditure for the next couple of years but after accounting for the rise in national insurance (NI) payments, PFI charges etc this will leave little extra for the average patient.

Scottish machine politician cries on telly!!

There have been heart rendering stories of a Scottish machine politician crying on a set-up interview with Piers Morgan. You can't play it both ways Gordon Brown. You either protect your family from the public gaze or you use them for your political ends. For instance, your performance allows me to say that your wife has so many charity engagements here and in the United States that no way is she looking after the family. Sorry, the Daily Mail has already said it!!

The new book by Lance Price, which I have yet to read, does not give you a very flattering picture. I get the sense that over half of the Labour Party would be estatic, if you were run over by a Clapham omnibus. That might be a bit harsh but Mr Brown, you screwed up my pension (dividend tax changes) and cost me a fortune in council tax paying for all those Labour areas. I would have forgiven you if Great Britain had pulled out its troops from Iraq and Afghanistan. The US anyway have been critical about our military performance (Basra and Balaclava, army disasters beginning with B?) Sorry, Singapore begins with an S). However, that would have screwed up your chances of top international jobs a la Blair when you retire. Or are you going to write your memoirs and explain how you employed a yob like McBride?

You are always grandstanding on the world stage but I get the impression that the IMF thinks you are an economic cretin. How you let Lady Ashton get a top EU job is beyond me. She is an easy pot shot for the French. Ashton should never have been let out of UK quango land.

However, Gordon, you are a very determined politician. I think the class card strategy might be working with the dim British electorate. The Tory Party does seem to have been taken over by Old Etonians and Cameron cuties. I get the sense the US would prefer working with you. Dave has never really hit it off with the Americans. I know the European Union would be aghast if the Tories got in. Peter Mandelson saved you last year from your Cabinet revolt but as you are not really a loyal kind of guy, he has been disappointed by your behaviour since.

I think you might struggle in the forthcoming general election campaign. It will be a test of what the voters think of a Scottish machine politician.

PS. Dear Reader, I am sorry this might not be a balanced, nuanced view of a complicated individual but you should read Jeff Randall's demolition of Gordon Brown
in yesterday's Daily Telegraph.

Eurozone "Pigs" could lead us all to slaughter!!

In Saturday's Daily Telegraph the economics columnist Jeremy Warner has written an interesting article headed "Eurozone #Pigs# could lead us all to slaughter".
Warner writes "both Washington and London seem gripped by the sort of political paralysis that can indeed prove lethal. We should not assume that the sudden loss of confidence that has afflicted Greece - essentially a developing market economy that should never have been in the euro in the first place - will be confined to the "pigs" (Portugal Ireland, Greece and Spain). The burgeoning size of public indebtedness the world over makes all economies vulnerable."

On the following day Liam Halligan, in the Sunday Telegraph, notes that the budget deficit in the United Kingdom is running at 13 pct of GDP compared with 11 pct in Spain. I wonder if his figures include the borrowing figures of the Spanish regional governments and regional health authorities? I remember years ago the Andalusian health body Insalud seemed to take almost years in paying its suppliers. Personally, I think Mr Halligan is comparing apples with pears when he talks about the UK and Spain. For instance, our town halls might be useless and incompetent but they are not as corrupt as Spanish ones, which Brit expats are finding out to their cost.

I think Liam is also too harsh on the Tories since there is no point in David Cameron scaring the voters (who are a pretty dim lot in the UK) with ideas of public expenditure cuts. People who voted Labour in 1997, 2001 and 2005, knew that the middle classes would be crucified by tax rises and that there would be redistribution from the south-east to Labour areas. However, I would not expect these policies to figure explicitly in any Labour manifesto but more cunningly in phrases such as "opportunity and prosperity for all". Then, there would be increased funding on Labour councils and less funding for Conservative ones leading to
higher council tax bills for Tory voters.

I think both Labour and Conservatives will cut public expenditure and increase taxes.
We could save a few bob by pulling out of Afghanistan and lifting VAT to 20 pct
from the level of 17.5 pct. The Irish government has received quite a few plaudits in cutting the pay levels of the public sector by levels ranging from 5 pct to 15 pct. This would be fought tooth and nail by the trade unions here in the United Kingdom but we are already being softened up by stories on police overtime scams. In the private sector the choice has often been a stark one "Do you want a job or not?"
and people have had to take pay cuts, reduced pension schemes and loss of crucial overtime.

A rant against David Lammy, Labour MP for Tottenham.

I have nothing personal against David Lammy, Labour MP for Tottenham. However, I think he is a bit of a worm for announcing major cuts in UK budget expenditure for British
universities in his role of minister.

As an ex-alumnus of Harvard Law School and a big pal of Obama, he himself has benefitted from a world-class education. The least Lammy could do his resign his UK ministerial post. In the 1960s Labour Chancellor of Exchequer, Jim Callaghan, resigned after a devaluation and still made it to Prime Minister in the 1970s. A resignation might do the political career of Lammy some good. He is famous for his leaden performances in the
House of Commons.

It is estimated that 200,000 kids could miss out on an university place in 2010-11.
There is a high number of applicants due to various factors such as a birth-rate bulge, disguised unemployment, gap-year students and places going to Chinese and Indian students, whom the universities can charge virtually what they like in terms of fees. The grove of academe!!

Lammy says that university expenditure has risen by 25 pct since 1997, when Labour got into power. However, I think National Health Service expenditure has risen by 100 pct during the same period.

Part of Lammy's current job is chasing up on Islamist extremists in our universities.
I don't think the United States is overly impressed by the role of University College of London (UCL) in educating the Detroit bomber.

Note for our foreign readers: Tottenham is the famous home of the Tottenham Hotspur (Spurs) football club based at White Hart Line. Perhaps it is fair to say that the
fans, who go to the matches, do not share the same demographic profile as the current residents of the area. A lot of the fans have moved out to Essex and
Hertfordshire.
Tottenham is now locally famous for deprivation, poverty and Turkish gangland violence.

For our American readers the JT problem explained!

I am assuming there are American readers of this priceless blog and so I will explain a bit about the John Terry (JT) scandal. You lot are used to your sporting heroes being overpaid and oversexed, which we share, although there is not the same problem over the use of weapons. Being captain of the England football team is still an honour here and team manager Fabio Capello had warned his players to behave up to the run-up to the World Cup in South Africa. Dipping your wick with your mate's ex-bird is not really a hanging offence but we got to put our best foot forward. So, Capello just took a 12 minute meeting to strip the captaincy off
Terry.
On a personal note a few years ago I was behind the Chelsea goal at Stamford Bridge when JT gathered the ball, took a few paces and then delivered this amazing curved pass to the left wing. It was literally a thing of sublime beauty. And I am a ManU supporter!

UK lights go out from 2015? Ofgem.

UK power regulator Ofgem has probably timed its intervention into the murky political/energy arena to perfection with its "Project Discovery". The report also probably makes the case that Ed Miliband, the Labour minister for environment, is a a complete **** (you chose the epithet!).
Ofgem chief executive Alistair Buchanan says decisions on energy security
have to be made by 2013 so as to prevent the lights going out in Great Britain from 2015.
One possibility outlined by the Ofgem report is a central buyer of energy, which is the nationalisation of part of the market.
We let Iberdrola take over Scottish Power for a very small premium but if Scottish & Southern wants to buy a Spanish utility the screaming from Madrid would be amazing. As for dislodging the EDF monopoly in France, don't even think about it.
One minute E.on was planning to build a new power station (Kingsnorth) and now it is not. We might as well as offer the Germans a low price for the old assets of Powergen. There was environmental opposition to the new unit at the existing power station but we are going to have to get real eventually.
I am not a little Englander but can we can really let our energy security be dictated by external groups and countries?
The dash into renewables such as wind power will probably prove a waste of money.

Quantitative easing, public sector debt and that nice Mr Blair

There is an excellent article by Claer Barrett of the Investors Chronicle, which tracks the positive effects the UK's quantitative easing programme has had on the commercial property sector. Foreign investors have been making hay with major investments and they have also been helped by the fall in sterling. However, one analyst cited by Ms Barrett notes that the £200bn quantitative easing programme (printing electronic money) of the Bank of England is going to have to be covered by the sales of government bonds (gilts) or government assets.
I don't think there is much left in the privatisation kitty (Scottish Water, the Tote!) and so I believe there should be more UK retail investment in gilts. These securities did have a dreadful year in 2009 but hey we have to think of our patriotic duty!!
It is a truism that Labour governments always run out of money but I wonder what would have happened if Tony Blair had sacked Gordon Brown. Then, we would have avoided unconfirmed reports of the UK premier throwing phones and printers around. There might also have been a chance of a few less gilts about.
Has quantitative easing worked? The UK government and the Bank of England have managed to avoid a complete collapse in economic activity. RBS and HBOS were rescued
and we are just out of recession although the youth unemployment figures are awful.
Lib Dem shadow chancellor Vince Cable had a good soundbite when he said the UK economy had just come through a heart attack.
The deleveraging of both the public and private sectors is going to take a few years. Commentators have been calling for a move from domestic consumption to exports. This is going to need a low pound against the euro for quite a few years yet. How it will be achieved when interest rates go up should be quite interesting.

The Independent's Johann Hari criticises Cameronics!!

In today's Independent its columnist Johann Hari criticises the economic policies of Tory leader David Cameron, which have been instrumental in the collapse of the Irish economy. He makes an excellent case for continuing stimulus policies and laments the self-strangulation of Labour.
Hari notes that Nobel Prize winner Paul Krugman is shocked by the economic policies of Cameron.
I suppose my view is that the UK economy has received quite a bit of medicine in the form of low interest rates, low exchange rate and high level of printed money, so we will have to wait a bit for the patient to recover. I don't share the view that economic growth will make the public debt problem go away but it will help if we make a modest start in reducing the state deficit. There will probably be an increase in VAT, whatever the result of the general election, and future cuts in the health and education budgets using inflation. For instance, there has been an explosion in the number of unqualified assistants in primary schools, which has not really led to an increase in educational standards.
What we do not need is heavy-handed attempts to reduce governmental budgets such as Labour's slashing of expenditure for the universities.
Going back to Hari's article, he notes that China and Germany are carrying bigger stimulus policies than the UK. However, these two countries can probably afford them.
He also calls for a labour-intensive transition to renewable energies.