That budget

On a positive note they may have just sorted the issue of lack of supply in the housing market. Just think how many extra home will be hitting the when all those who can no longer afford their mortgage are forced to sell!

The FTSE 250 is down another 2.5% at the moment.
As I work in a small financial services firm that's on the 5th floor of an office block I feel as if I should go in to lock all the windows and remove the window keys..........

I understand why they’d want rid of the 45p rate but politically it’s idiocy. I don’t agree on raising the personal allowance further, I think it’d be better to have targeted the benefits taper to encourage more people into work.
I too hope it’s a short term but the markets need confidence and we’ve got Liz Truss.

I totally agree that the taper needs to be much longer and smoother but no party has ever seemed interested in doing something that is otherwise common sense: they consider it quite reasonable that someone should come off benefits and take up full time work to be £30 a week better off - as the real life case told me, it's simply not worth going to work for £30 extra when she has to pay for transport, some new clothes and someone to pick up her children from school. She might do it for £75/£100 a week extra though. The current system is broken! 

It seesm to me that Truss and Kwarsi may be mad or genius. It's too early to tell. Market sentiment and reaction to the budget seems to verge on the political rather than the fiscal. Economic orthodoxy does not like to be challenged. When Rishi and Boris raised NI and announced a planned CT increase, sentiment was not exactly gushing either. Increasing taxes into a potential recession was widely criticised, by some of the same people now criticising what the min-budget announced. And of course the same people who now cry from the rooftops (like the IMF) all warned about inflation didn't they? Oh, no hang on, it was just transitory, wasn't it....

The underlying issue is really one of cheap money carrying on for far too long and how central banks finally - after years of low rates post the 2008 crash - try to get rates back up to normal. Which was put on hold by the 2 year hiatus - and money hosing - of Covid. Cheap money caused asset inflation from 2008 to 2020 and the helicopter money of Covid - giving money directly to people - and supply chain disclocation has now added direct retail inflation on top. US base rates are 1% higher than the UK. There's your weak £ in a nutshell. By not raising rates quick enough, the BoE has brought much of this issue on. They're independent so how can that be the government's fault? 
 
Taking the general economic view and comment, I think people like the IMF are ignoring the elephant in the room. The big one with "so what TF do we do now?" written on it. If public debt is too high and a recession is coming, then there are several options. Spending cuts. Taxes. Borrow more. Get growth. Do nothing. Nobody will stomach huge spending cuts. Nobody will stomach huge tax rises. So that leaves borrowing and growing the economy. Or doing nothing.

General economic orthodoxy is in the do-nothing camp - allowing what they euphemistically call "demand destruction" to solve the issue over time. Truss is going for growth. They hate her for it.

She may succeed, she may fail. But would all those people who now think a labour government is the "sensible option" tell me that they would actually do different? Well they'd tax "the rich", tax companies higher (windfall taxes) - both politically easy solutions that have fuck all real effect - and when that proved insufficient do what Brown did and tax everyone, especially the middle classes.  

I have a theory - said as a joke but a couple of sensible friends (well, I thought they were sensible) took it seriously) - that Truss & Kwarteng are playthings of a group of senior Tories that realise there is absolutely no way they're going to win the next election, primarlly courtesy of Boris' antics since Christmas.
OAdded to which the current economic climate is really spectacularly unhelpful.

So this fiscal event, shrouded in mystery as it is, is a deliberate ploy to ensure they have a >:(100% chance of not getting elected.
Therefore in approx 2 weeks time they'll call a general election. Labour will win it handsomely and have a clear majority in the next parliament at which point the economic headaches will be theirs.
Since the media and electorate have a very short memory this will allow the Tories to sit in opposition for most of the next 5 years and constantly ask what Labour are doing to make everyone's life better.

Clearly this'll mean that Truss will only be PM for a few short months but it would certainly explain why the Tories have allowed someone so out of their depth to become PM and then surround themselves with what increasingly looks like cannon fodder.

So, once the GE is lost there'll be another leadership election and the competent candidates will come out of the shadows.

How's that? Anyone want to expand on the theory

Apparently the Labour guy who left the note wasn't the first to do it.

^ Similar.

I reckon that sometime before the next General Election there will be another Tory leadership contest and guess who will be running for leader. Boris is back!

That's not as daft a theory as it sounds either given that his hero was Churchill who was ousted as leader before coming back to take the party back into power. He could well view it has his Churchill moment.

My other theory is similar to others above in that the Tories know full damn well that they are doomed to lose the next GE to Labour and so this big tax giveaway was a way to make their rich mates even richer in order to encourage either more party funding or to make sure there are plenty of friendly faces to offer cushy jobs to those senior MPs who will be losing their seats.

I think people seem to have little idea of the level of profits and costs involved in UK Continental shelf operations. The likes of Shell, BP, Exxon are not even the biggest operators in the North Sea - they've have, and continue to, divest themselves of their assets to smaller operators as the level of profit is too small. The largest operator in the North Sea is Harbour Energy, a recent merger of Chrysaor and Premier Oil, relatively small companies that can leverage their lower cost base to maximise residual value in old fields.

My understanding is that for off shore wind you pay a license to operate in an area, agree a price per MWh generated then go and build at risk. As the cost of hardware reduces the price per MWh based on market costs dictated by gas / coal / nuclear / older wind means newer fields are coining it in.

Who thought up the idea of linking the price of electricity to the price of gas? Apart from the fact that our short sighted Politicians decided to build some gas fired power stations, the two have nothing to do with each other and the costs are totally unconnected.

Don't forget also that the Russians had shit loads of it that they were willing to pump to Europe at super low prices providing an almost endless and reliable supply of cheap energy. What could possibly go wrong?

She came from their system, being an "Oster".