Liz Drops The Ball

After a month in the job of Prime Minister, Liz Truss is already on the back foot. One huge policy U-turn has already been necessary, and her performance at the recent Conservative Party Conference was uninspiring at best. She must have a bad headache this weekend, as she reads the newspapers. The few politicians remaining loyal to her, mostly to protect their jobs in cabinet posts, are urging the rest of the party to back her to the hilt.

But she has dropped 25 points in the polls below the Labour opposition, giving the leader of that party, the equally uninspiring Keir Starmer, a spring his step, and a smile on his face. Next, she faces action from the fiery Scottish Nationalist leader, Nicola Sturgeon, who is tackling her head on about a referendum for an independent Scotland in 2023. With only just over a year left to make her mark, it seems that Truss may well face a disastrous defeat in 2024, unless she goes back on almost every policy she advocated during her leadership campaign.

Some of her colleagues are already calling for a vote of no confidence, and a new leadership election. The only thing holding them off is the fear that she might call an early General Election, thereby losing most of them their lucrative parliamentary seats, and handing government to Labour on a silver platter.

The U-turn that caused all the fuss was over the scrapping of the 45p in the Pound tax rate for anyone earning over £150,000 a year. One day she defended it, the next day she reinstated it. The Chancellor, Kwazi Kwarteng, defended his decision to scrap it, claiming in had been a ‘distraction’ from more important policies.

But it was too late.

Interest rates had already risen.
The Pound had fallen to an all-time low against the US Dollar.
Monthly Mortgage payments had already increased.
Mortgage availability decreased.
Anyone buying their own home was worse off.
National debt had increased because of the fall in the pound and the rising rates.

The media and various financial pundits were all asking the same question.

Why had that been done in the first place, when a financial guru like Kwarteng must have known it would be a disaster?

I think I know the answer.

Before becoming a politician, Kwarteng had been a successful hedge fund manager in the financial world. As a schoolboy, he won a scholarship to attend the influential Eton College, one of the most prestigious private schools in England. Other famous old Etonians include Boris Johnson, David Cameron, and Jacob Rees-Mogg. All of whom have had Conservative Cabinet posts, or served as Prime Minister.

In other words, Kwazi’s friends.

Kwarteng also worked for JP Morgan Chase as a financial analyst, and was a journalist on the right-wing newspaper, The Daily Telegraph. So his credentials are undeniable. He knows about national finance, he knows about international finance, currency markets, and interest rates. And he is not short of money, with his personal wealth estimated to be close to £3 million.

That means he also knows about ‘Shorting’ currency. Betting that it will fall on the world markets to make those markets nervous and guaranteeing it will fall. He also knows about buying back currency when it has reached all-time lows, and making a small fortune when it settles back to where it was before the fall.

Far be it from me to suggest he did this. That would be ‘Insider Trading’, and is illegal in UK law.

But you can bet he made a few phone calls to his rich friends, and that they are drinking very expensive champagne since Truss was forced to do her U-turn.

Pigs at the trough. Pure and simple. And what of the people struggling to pay increased loans and mortgages?

“Let them eat cake.”

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22 comments

  1. wilfredbooks

    My hope [among many, of course] is that the way ‘ordinary’ people are being treated now will cause the scales to fall from the eyes of the gullible voters who helped elect the Tories last time, and they will deliver the killer blow to this excrescence of pond life as soon as an election is granted to us. We’re still saddled with the anachronistic 2-party system, thanks to FPTP, but perhaps Labour will be persuaded to ditch it in favour of PR, when it is swept back in; in the meantime, we might have to suffer another Blair. Cheers, Jon.

    Liked by 2 people

  2. Heyjude

    A complete disaster and annoyingly one we didn’t have a vote for. I despised Thatcher and Truss is just plain bonkers. We need a general election and soon so we can get rid of these despicable people. My daughter’s mortgage has increased by £500 a month since January (she’s on a variable mortgage as her ex won’t sign up to a new deal – a bit late now – and she’s paying it all on her own)

    Liked by 2 people

    • beetleypete

      I’m not a Starmer fan, but anything has to be better than a bunch of rich tories getting richer at the expense of hard-working people. They knew your daughter’s mortgage would go up, and probably go up again until she can’t afford to pay it. But they couldn’t care less. Look how smug Kwarteng and Rees-Mogg are, you can see it in their faces. I think they are operating Truss like a hand-puppet.
      Best wishes, Pete.

      Liked by 1 person

  3. nicknicklambert

    I totally agree, I believe there is evidence that his associates made money from the pound going down and then more money from it going back up after the policy’s cancellation. There is also evidence of one of them changing their position shortly after a phone call with Kwarteng, although he denies that they spoke about any policies and says that they speak on the phone regularly, so it was just chance.

    Liked by 1 person

    • beetleypete

      Nick, I heard that ‘more than a few city types’ made lots of money shorting the pound before the first announcement, then more by buying back before the U-turn.
      One was even interviewed after making over £1.5 million in one trading day. He was said to be a ‘friend and former colleague’ of Kwarteng, but denied receiving any information from the Chancellor of course.
      Thanks for adding your own research.
      Best wishes, Pete.

      Liked by 1 person

  4. rolandclarke

    As an expat living in the US… but paying UK tax, I find your analysis insightful. I wish I had a vote to influence events, but annoyingly I’m now disenfranchised both sides of the pond.
    Keep the red flag flying, Pete.

    Liked by 2 people

  5. Yetismith

    It’s all too depressing. For relief you could always have a look at a Trump rally. The latest in a small town in Nevada. It is not just depressing but mind boggling. The man is seriously off his rocker and still many republicans follow him. I just do not understand.

    Liked by 1 person

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