35%

90 days left.

Back in November Ed Miliband was under pressure. He might get booted out. 
It was all a nonsense. Just backbenchers sounding off. There was no way he was being moved on. Mostly because it was far too late in the day to change leaders.

I wrote about it at the time. And listed 30 odd reasons why he would be the next Prime Minister. The advantages are all his. It seemed virtually impossible for him too lose. 
 And yet he continues, day in, day out, to try and lose the 2015 election. 

The worst leader of an opposition since Michael Foot. Possibly even worse than him. 

Ed Miliband beat his brother to the leadership of the labour party, by getting union votes and defeating his brother. he must be tough to have negotiated and undertook that. he must have had some vision? Some idea of why he wanted to be leader and what he thought he could achieve. He didn't appoint Ed Balls as chancellor. A brave act. They were both Brown's capos. To refuse him the prize he craved showed a political soundness. It was 'events' that made Balls chancellor.

Somewhere along the way, his spinners and Spads and graph guys showed him the 35% strategy. 
Labour did not need any vision. It just needed to retreat to its core vote and prevent the Party fragmenting after its crushing defeat in 2010. Someone pointed out to him that in 2010, even after the disastrous premiership of  the coup-king, Gordon Brown, with the economic crash and labour having totally lost its way, the party still retained 29% of the vote. 
Someone will have shown him the constituency map that plotted the seats which Labour had lost, but could be sure of winning back just by virtue of not having Brown in charge anymore. They would have pointed to all the Scottish seats where Labour, incredibly, had  gained votes in 2010.
"Sit tight Ed..Its all going to be alright. best not say too much..See what's happening first.."

He might not have been convinced. probably decided to try out some 'producer-predator-onenashion' phrases. Started to write down some ideas. tested out some theories on focus groups.

The Spads came back. "Ed..Ed ..the Liberal democrats are a disaster..they've dumped all over themselves. Their supporters are fleeing the yellows and joining the reds! That's going to boost us some 8%! We don't need to do anything .. just sit tight."

And then the boundary changes were dropped. That made his job even easier. And all that talk of cuts..cuts..cuts..It was a gift to the spending party. Tory incompetence at the budget lost the coalition its fragile public support by 2012. 3 years to go and he was ahead in the polls. Significantly ahead. 

And the news just got better. UKIP turned up. The protest party began taking real bites out of the Tory votes. Marginal seats were going to fall like ripe fruit into his hands. Ed Miliband could be looking at Blair like majorities of 100+ seats. And all without even writing a manifesto. 

Just some platitudes would do. Say lefty things to lefties..and say not a lot to righties. Who needs them?  Tax 'em with a mansion tax. Say that tax will raise super-dooper billions to pay for the Tories-Liberals failed economic experiment. And oppose everything the coalition does. Everything. Don't even think about it. Just say its wrong. So when it fails, Labour look like they were right.!
The coalition is carrying out NHS reorganisation. Imposed from above. What a gift!
His advisers will have told him that voters liked labour, but they didn't much care for weird Ed. So, try not to say much about anything and keep out of sight. And they would have told him that even on his best days, he is only mediocre at PMQs . So.. best not say too much.

The only problem with this strategy was that it was dependent on the economic situation remaining bad for 5 years. Prices rising for 5 years.The coalition not changing tack for 5 years.

And that is why it was a bad, bad, bad idea. Ed Miliband has no fall back positions. He has no uplifting policies to offer an alternative to floating voters. He has chased his own and ignored the rest. His narrative about how beastly the coalition is and how heartless the Tories are, compared to cuddly old labour won back the labour lost and a big chunk of former liberals. But that's all.

Back in 2012, that was enough. He was going to win with a comfortable margin.
But in 2015 its not. The Scots are doing that rebellion thing again. The fringe parties are taking votes of him both for being too left wing and not left wing enough. As the economy improves, and the coalition begins to deploy its election power, Miliband is pushed back.

He has nothing in reserve. He has nothing to say that hasn't been said a hundred times. 
For the big spring offensive labour have chosen its favoured muddy battlefield of the NHS. The one area that labour is consistently ahead on polling data. Which is why it will fail.

Labour already have those NHS votes in their pockets. They have had them since Lansley gifted them to Labour be foolishly messing in an area where messing should have been severely limited. The votes he is trying to win are by fear. And that's not going to be good enough to swing the 5-6% of voters that he is short.

This offensive , this weaponised conflict, is already failing. Andy Burnham, Labour's general of nurse, bogged down soon after leaving the trenches. Rear-Admiral Milburn sunk some of his own ships getting out of port.

Labour take comfort from recent polls that show the NHS is the number one issue for the public.And labour has a big poll lead on dealing with the NHS.
What they also know is that was just one poll. carried out after the newspaper 'NHS in crisis' week. For years the real top issue has been immigration. And labour is totally distrusted on immigration.
third is the economy. Labour can take very little comfort there either.

So they are reduced to going into battle with a very depressing message of failure and misery, and very few ideas to do anything about it.

Labour's advantages in this election are so great it would take a real lemon to fail. 
Ed Miliband will probably still become Prime Minister in May.

Probably. 

But he doesn't deserve to be.

BBC Question Time Competition.

David Dimbleby presents topical debate from Wrexham in Wales. The panel includes Conservative culture secretary Sajid Javid MP, former Labour secretary of state for Wales Peter Hain MP, Plaid Cymru's economy spokesman Rhun ap Iorwerth AM, author and critic Germaine Greer and Telegraph.co.uk blogger Kate Maltby.

Looks like a real stinker.  

Bill Quango suspects - 
1. NHS NHS NHS {don't mention Labour in wales NHS}
2. Syriza- Austerity - Something Hain said about Miliband going down the Michael foot road - These old commies - they never stop trying , do they?
3. Saudi king died. Flags at half mast - it was a story at the start of the week. forgotten completely by now. But BBCQT works on its own timeline.
 4. Holocaust week. Are anti-EU supporters planning on gas chambers ? 
5. UK GDP fastest growing in Europe. Why aren't we feeling rich ?

Dimbletie - Professor Plum

   Scoring
1 or 2 points for each correct question asked. Depending on how close to the actual wording.
5 points for guessing the colour/design of  the Dimbleby tie.
 2 points for nearest match if no outright winner
1 point for each witty comment/excessive punning/ lampoon/mock/clever theme  that you put into the comments
1 point for the first entrant each week 
1 point for random other reasons

League Table 2015 

Hopper -2
Blue Eyes - 1
Taff -1
Kilgore Trout - 1

Charity Shield winner - Malcolm Tucker.

$200 Oil ?! Way to go!

"OPEC Secretary-General Abdullah al-Badri said on Monday prices might have bottomed after the seven-month selloff, and warned of a possible spike to $200 a barrel."

An optimist, eh?  That's what we like to hear!  Last time I recall $200 being mentioned, it was by Putin - oh yes, and Goldman Sachs - back in 2008, when oil was at $147.

Happy days.  Way to go, Abdullah!

ND 

Tsipras gives a big hint of the stitch up on Day 2

"We don't want to go to mutually assured destruction [with the eurozone] but we won't continue being subservient"

So already of the Greek nightmare and already the enormity of the situation facing the Syriza Government has dawned on its hapless leader, Alex Tsipras. Greece won't default on its debts nor exit the Eurozone....but nor will it be subservient according to reports of his first cabinet meeting.

If I was a more cynical person I would think this is all a set up.

Last week The ECB announced QE, €60 billion a month of Government bonds to be bought. Then Syriza is elected and now they are already moving towards just asking for a bit of debt forgiveness to placate the populace.

The QE until July will push $240 billion of debt onto the ECB balance sheet - the holdings of Greek debt by Eurozone countries are, err, $240 billion. What a strange co-incidence!

It is almost as if Merkel has stitched up to accept QE in exchange for only forgiving Greece say 30% of its debt and it continuing in the Euro. This 30% will allow for a little more spending to keep Tsipras happy.

Life is good in the democratic Eurozone. Less so for Greek people trapped in the Euro nightmare perhaps, but hey, they are only little people after all?

Will this dastardly plan work...

 ....There's many a slip 'twixt the cup and the lip

Tories allow Labour to block Fracking - 100 days to election today

So last night in the House of Commons, the Tories agreed to Labour amendments to the Infrastructure Bill which means that 13 loopholes have to be closed in the environmental legislation before Fracking can go ahead.

Following planning rulings earlier this week, it has been a bad week for the future of Fracking in the UK. See below for how the IGAS share price has fared this year as a proxy to for how the prospects of fracking have fared:

It is down from a high of 148p to, er, 20p today.

It is not surprising with an election coming up that the Government will want to be seen to be giving into celebrity backed campaigns (Bianca Jagger says NO TO FRACKING, etc) with loony Green agendas as this helps bolster the Governments credentials on easy U-turns Green issues.

With the low oil price in any event, the strange turn of events is that this won't make much difference. Much like the last North Sea reserves, with oil below $50 none of the more expensive extraction ideas are going to be implemented. So the new North Sea fields and the Fracking are going to have to wait anyway for the recovery of the oil market; much as the rest of us don't want that to happen!

More worrying long-term is the nature of the complaints. For the first time in Parliament a key issue raised against fracking has been missing carbon targets. This is nonsense as Fracking is better than coal or oil. Guido wrote a super piece yesterday outlining how the anti-fracking lobby is full of hot air and waffle with hand-wringing communists as the centre of it, but has captured the Environmental committee. Even the Tory chair, Anne Macintosh, was a potential rebel last night.

Whilst I am in full agreement that unlike the US we should proceed with a safety first approach, we should indeed look to proceed. Modern Government seems paralysed by the intellectually incoherent green waffle and renewable subsidy-junkie lobbying.

With Labour, Greens and SNP on the march to winning an election between them, prospects for long-term cheap energy supply in the UK look to be in danger.

Syriza - The New Archanians

 

Back when Greece was great, busy inventing democracy and defeating the Persians it also did a good line in Comedy. Indeed, Greeks, as with much in Western history, invented modern comedy. The greatest exponent of the original art was Aristophanes.

The news that Syriza have won with 36% the Greek election reminds me of one of these plays. Notably 'The Archanians', in this play the hero is trapped for a long-period. Most of the Athenians do not want peace from the war with Sparta, but the hero, Dikaiopolis manages to negotiate a private treaty to end the war and sets up a market to supply the rest of the Greek cities.

In this way today, Alexander Tspiras, must continue. He knows that Europe and the IMF cannot really bend to his desires. That way lies a compromise with Italy and even France, which cannot be afforded, even if a compromise with Greece could.

So instead he will ask and be refused. A messy compromise is the best he can really hope for. Somehow, in their desperation the Greeks have believed in the magic money tree rhetoric of the left - but without really appreciating the truth.

The only way out for Greece is to leave the Euro but even Tspiras will be very reluctant to take the path he has always denied he wanted.

It will be a busy few weeks, but there will be some comedy along the way from all sides before the final curtain.

Flying at Half Mast

"Oil surges after Saudi King's death"    - report

"Oil prices climb on death of Saudi Arabia's King Abdullah" - another report

You're looking at a different graph to me, mate.

ND

I'm Lynton Crosby. I solve problems.

ding dong ...{The door is opened by a dressing gown clad Jeremy Hunt.}
A sharp suited man is standing there. A small ipad in his hand.

"You're Jerry, right?" he asks. "This is Tory HQ?" I'm Lynton Wolfey. I solve problems... May I come in.?"
"Sure..I'm Jeremy Hunt, Health Secretary.."
"Ok Jerry. Is it in here?.." Lynton heads into a small office.

He looks in and finds  two men in blood stained suits..."You must be Dave ..And that makes you George..Ok genel'men.. Lets get down to business ..I believe we have a difficulty here and the clock is ticking, is that right, Jerry ?"

"That's right Mr Wolfey"

" Now...let's see...If I rightly understand the situation." He looks at Cameron and Osborne,           "Then you two ...have killed the Tory party? "

"Yes"

Wolfey consults his ipad once more.."You took the principles of a low tax, low spend, small state economy and ... again, if my notes are correct here ... you shot them in the face?"

"Accidentally. We  didn't mean to do it."

"Nevertheless we have the corpse of fiscal responsibility, and a dead EU referendum election strategy, in a battlebus, in a garage..or wait...does this say Farage? ..Anyway ..take me to it."


They go through to Tory HQ basement strategy room with media grids,  week by week focus issues and soundbite boards. There is an election battlebus there. The inside is covered in gore.

"Hmmm ..This is quite a mess." says Lynton. "Ok ..Gentleman We are going to need all this soppy, gooey Lib Dem eco-mush gone by election time...or our core voters will not be best pleased, is that right?"

"Yes sir."

"We have an election in 4 months. . and we need to tidy up, and get the heck out of Dodge? That should be plenty if you do what I say, when I say it."

 Lynton Wolfey looks into the battlebus.. Its in a very poor state. half formed ideas and bits of human rights and Big Society agenda are splattered about inside it.

"George.." asks Mr Wolfey, "About the economy..anything I need to know? Is it running? Does it stall? Is it likely to overheat. Or fail to start?"

"Far as I know its just fine Mr Wolfey. It was going fine and then ..well..we hit this bump. But before then the economy was fine Mr Wolfey..for...you know...an indebted European country, with an over reliance on a financial sector and a southern based service sector bias, following an almighty economic crash."

Still peering into the bus Lynton calls over his shoulder, "Jerry, would you do me a favour?"

"Certainly Mr Wolfey."

I saw some coffee and an NHS privatisation report on a table back in the office..Wold you get me a cup of that coffee ?

"Erm..Ok..."

"And alter that file on privatisation."

"Er...ok ..Erm...Mr Wolfey, how do you want me to ...

"Lots of cream and lots of sugar.."

"Erm.no.I meant how do you want me to make the file.."

"Jerry..is that the file on co-partnership..using private sector resources in the NHS and competitive tendering ? " asks Lynton Wolfey.

"Yes, it is."

"That's going to reduce the rising cost of the NHS on taxpayers and the government budget?"

"Good..Take out any word that has privatisation or anything like that at all..Outsouscing. Commissioning. Profit..Dividends..Provider..and so on. Replace them all with some non-specific catch-all anytime phrase. But use cuddly words..like clinicians -passionate-sociological-economic-care. Or nursing-excellence-rainbow-path-gate, OK Jerry ?"

"Erm..er..excuse me, Mr Wolfey. But that...that won't make much sense.."

Lynton smiles.  "It doesn't matter, Jerry. No one is going to read it anyway. Just want to neutralise the bad smells. But I would like that coffee."


Ok .. lets go back to the office.

****

"Thank you Jerry," Lynton says as he takes his coffee..he has a sip. He takes in the flavour for a few seconds then he turns to Mr Hunt smiling.."This is good coffee, Jerry...  Make sure there is no more of this..I want basic Nescafe or Red Mountain and Tetley teabags only..No biscuits..We have an overpaid, privileged  posh bays tag to clean up too."

Lynton drinks some more of the fine brew and thinks for a moment. After a second he begins to give his instructions.

"OK ..here we are.. Jerry, this looks to be a very well funded party HQ..That would lead me to believe that under the sink there is a box of products that we can use to detoxify this election vehicle?"

"Right Mr Wolfey."

"That's good Jerry. Right..Dave and George... Dave and George..Get a box of those election leaflets," he points to a stack of crates in the corner.

"These 'A Britain living within its means' ones?" asks Dave.

"Yes. take those and some Windex and use them to clean all that crap up. Take as many as you like. We won't be using them.  You need to be fast, fast , fast.
   Get into the back there and pick up all those idiot policies about green energy subsidy and selling forests.  Minimum pricing for alcohol.  I think I saw a great big piece of 7% GDP on foreign aid splatted on the back seat. That hug a husky..something about matching labour's spending plans..opposing grammar schools .. gay weddings in churches.. ..all those wet and soggy pieces are to go in the trash.

Clean up all that interior. Clean up all that horror..Now..when it comes to the bones of the manifesto..it doesn't have to be all spik and span... just surface polished. It doesn't have to be conference clean..Just enough that a passing glance by an observant commentator or media pundit, won't uncover what's underneath. Because we are going to disguise it all with pensioner friendly voter bribes..Conceal all this old middle-ground, left-of-center nonsense with rightist sounding commitments and middle class tax cuts."

 George is horrified ..He blurts out.."But..Mr Wolfey..we can't begin to pay for.."

"Relax George" says the Wolfman.  I said disguise with..not deliver upon. However, George..I need to raid your Treasury. Going to need lots of ...erm..like..comforters..Blankets..Snuggie-Huggie type of policies..  And some big , cover all, tablecloth type policies? "


George is a little unsure what he has been asked for.."What ..you want .me to  find.."

"Even more spending for the NHS. Promise them double whatever you have promised now.  A ..erm..a  plan to make immigrants wait five years for benefits... A search and rescue-slash- military use-slash medical helicopter branch of the civilian new army..
Maybe , a VAT reduction back to 17.5%? Make it 15%. Get something large, George. Search around for something big enough that will completely cover labour's price freeze and mansion tax and obscure Fargae's get out of EU.
 Jerry.. we are going to need a fluffy disabilities allowance too. To cover the worst of the bedroom tax. Something like an extension to pensioner income bonds and a bring back Treason to the statute books for terrorism..ok ..that sort of thing...
Gentlemen we are going to camouflage this election vehicle. Make it acceptable . It won't stand up to some nosy reporter sticking their beak in and poking around.. But to a casual voter it should seem respectable..reliable.  Jerry..lead the way..You boys..get to work!"

As Wolfey goes to leave Dave  mutters "A  please would be nice."



Lynton Wolfey  stops. Turns. And comes back into the office.

 "Come again?"

"I said a please would be nice..You are asking me to raid the Treasury for party gain. To promise undeliverable things, while throwing away all the liberal coalition success I have had. I have kept it all together for five years. A please would be nice."

Mr Wolfe is visibly annoyed.

 "Let's get something straight, mister.  I was asked to come here to fix things.  Paper over the back-bench EU split cracks. Stop the Kippers from sneaking into your back yard. Make like the debt has actually decreased and everything is Hunky-Dory in the world again. Spin the unemployment figures so that more people are in work, though productivity is back to the 1990s.

..I don't say please. I tell you what you need to do! OK ?

"If you think you can win this election by telling people you kept Scotland in the Union and spending £250 billion pounds on a train track that rips through Tory shire gardens .. well lots of luck!"

"Gentlemen..I'm here to help. But if my help isn't appreciated.."

"Hey ..hey .. Mr Wolfey..it ain't like that," George says quickly..trying to mollify the Wolfman.

Dave is chastened .."Mr Wolfey..your help is definitely appreciated..Its just I don't like people barking orders at me..that's all.. I'm the Prime Minister of the United Kingdom."


Lynton has another sip of the fine coffee

"Well if you hadn't raised taxes on your voter base, " he says, " spent more cash than a whole cabinet of Brown's. Angered teachers and infuriated the medical profession with a top down reorganisation.. whilst going back on an EU referendum pledge, allowing the whole immigration issue to become such a massive problem, 45% top rate of tax on basic earnings and a cap on child benefit..You wouldn't need my help, would you?"

"If I'm curt with you, its because time is a factor. There is an election in four months and you are nine points behind where you need to be. I need to hurry you because we have only weeks to do things you should have been planning for..not wishing for .. years ago.
So I talk fast. And if you guys want a way out of this mess you've made, you need to act fast..So Prime Minister..Please..With sugar on top ....clean your f##ng act up."

BBC Question Time Compo.

David Dimbleby presents topical debate from Eastleigh in Hampshire. Panellists include Conservative employment minister Esther McVey, Labour's Diane Abbott, deputy leader of UKIP Paul Nuttall, former president of the Liberal Democrats Tim Farron and editor of The Independent Amol Rajan.

BQ believes:
1. Obama + Dave -A fine bromance. Did the PM get all he wanted from the Golden Child?
2. Leon is dead . Tinfoil sold out across the nation. A brief tribute question..morphing into a Simon Danzuk conspiracy. {Danzuk has said if T.May had just got on with this inquiry, then the key witness would have given evidence , and not be dead. .. He forgets it was him that called for two changes of people to head the inquiry...He's as much to blame, himself.}
3. Chill-clot. |what is going on? Why is it such an issue for so long? Woodward {of |Woodward and Bernstein fame}  has already written THREE, 1000+ page books, all about the lead up to the Iraq war. These are factual books with every existing email, post-it note, back-of-the envelope evidence examined in excruciating detail. They are so detailed they are really just too tedious to read. But if you want to know who said what, to whom, about what,on which day, and who was copied in..its all in there. And they been available for years. I read all the Blair bits. 
Its exactly what you already thought.
4. SNP, balance of power..devolution..we will stop privatisation..etc.
5. That invoice to a schoolkid. Pay for the party you didn't attend. Well done parents. Alienated, embarrassed and emotionally scared your offspring, plus given yourself even more factions to avoid at the school gate.All for £15.


   Scoring
1 or 2 points for each correct question asked. Depending on how close to the actual wording.
5 points for guessing the colour/design of  the Dimbleby tie.
 2 points for nearest match if no outright winner
1 point for each witty comment/excessive punning/ lampoon/mock/clever theme  that you put into the comments
1 point for the first entrant each week 
1 point for random other reasons

League Table 2015 

Hopper -1
Blue Eyes - 1
 

Charity Shield winner - Malcolm Tucker.

EU take the money as Cameron's lies get found out on UK Budget deficit

The Public Borrowing numbers for the UK in December are grim. Instead of the forecast £10 billion of borrowing ( a mere £333 million a day, natch) the actual number has come out at £13 billion.

Oh dear, so far, so bad. Except that £2.9 million is the EU payment made because we have a strong economy of drug dealers and hookers (I knew there was something positive driving all this immigration!).

This is the announcement when made last year that Cameron and Osborne led them to protesting too much that the UK would 'never pay' and it was 'unacceptable.' Everyone else pointed that as a member we had to pay, so we would.

And Lo, we have.

It's a sad end to the Coalition that after 5 years of Government they have averaged only a 1% reduction in the deficit a year and increased payments to the EU.

Nil points.

Oil Price: More Whistling In The Dark

Before we get to the frantic whistling, here's an observation from Old Drew's collection of historical anecdotes.

Back in 1994 there was a big overhang of gas supply in the UK, which came about for a variety of reasons I won't bore you with.   The spot market had just started and liquidity was building nicely.  Over the period August '94 to January '95, the price fell from 22 pence per therm to 9 p/th and there it stayed, with seasonal fluctuations, for the next four years:  a fall of 60%.  Why it settled at 9 has no obvious arithmetic rationale - there was plenty of North Sea gas available at lower cost than that - but hey, that's how markets work.  The price of a house has little or nothing to do with the cost of bricks.

Anyhow, one cannot fail to be struck by the similarities between this, and what's been happening to oil.  Maybe January is a good month for bottoming out after a rapid halving of prices.  Then again, for anyone taking cheer at the prospect of finding a bottom there's the unhappy prospect of 50 (or 45?) becoming a new baseline for several years.  As I've pointed out before, only in 2008 did a big oil-price movement ever reverse inside one year.  

I'm not sure how all this sits with the conspiracy theories, but I'd be very surprised if anyone has seriously and consciously engineered $48 oil.  They may have to live with it anyway.

As we all know, among the many parties who'll suffer will be the greenies - amusing bedfellows for Russia and Iran.  The greens of course (and perhaps also the reds), hope in turn that frackers will be hurting to the point of extinction: they'll see the hurt happening alright, but that'll be the limit of their gratification, I suggest.

Here's another source of whistling and bleating - along with some more sensible reflections.  The International Renewable Energy Agency ('IRENA') is one of those annoying and spurious international bodies - 'an intergovernmental organisation', no less - that busies itself at our expense promoting a special interest group.  They've clearly been working for quite a while on a substantial report on the costs of renewables which contains some interesting stuff, albeit spun about with quite disingenuous and misleading puffery.  

Just as they get to publication date, the oil price kicks them in the goolies.  But their jolly Director General, one Adnan Z. Amin, puts on a brave face.

Renewable power generation will keep getting cheaper over time, even in a period of falling oil prices, which history tells us will in all probability be transitory. Renewables development and deployment represents the most secure long-term hedge against fuel price volatility, the best route to reducing greenhouse gas emissions, and a sound financial investment. Their future is bright indeed. 

That would be the long term future, Adnan, because a chilly draft is coming in the short- to medium-term.  'Transitory' won't be measured in months, and there may be a drop-off in demand for energy volatility hedges, ask Ed Miliband.  Ad's right about costs coming down though - they'll have to, it's the only response possible.  Oil costs.  Coal costs.  Wind costs.  Even, dare I suggest, nuclear costs.  Come on you engineers, you know you can do it - you always have done in the past.

And solar PV costs in particular.  Here, technology really is moving forward apace.  Based on some fairly uncontentious projections, it is well within the bounds of plausibility for solar power one day to be economic.  (That's really economic, not 'economic when supported by subsidy'.)  Some even say, we may not need to wait for cheap & efficient electricity storage before solar makes it to economic respectability.

In the meantime, despite the waffle they all still want subsidies.  Which will be in increasingly short supply, with the alternatives at rock-bottom price for a while.  That Paris jamboree will be pandemonium.

ND

China growth slows..but not really

The key here is not to forge the impact of compound growth. As much as a pinch of salt must be given to all Chinese Tractor Stats given their source, at the base level China has been growing its economy very quickly for many, many years.

It had plenty of ground to make up, but fundamentally, the growth has been there in spades, literally.

Since the great recession there must be a big worry that much of China's growth has come from leveraged over-investment, much as the West's growth in the naughties was also financed on the never-never which has come back to bite us quite nastily. When this happens to China, as has happened to every other Country in history that has over-invested in infrastructure to such an extent, it could get nasty. Given China's massive population its ability to absorb over-investment is colossal, so this may be a few years or decades away. That one is as hard to predict as the next house price crash in the UK.

But, back to the point about why China's slowing growth is a chimera, here are the reported real GDP stats for China going back 12 years at current dollar prices:


Date                 Value                        Change   %


2013         4,864,002,759,905                7.67 %

2012        4,517,459,790,990                 7.65 %

2011        4,196,333,171,021                 9.30 %

2010        3,839,284,159,376               10.45 %

2009        3,476,132,934,123                 9.21 %

2008        3,182,858,058,706                 9.63 %

2007        2,903,149,265,437               14.16 %

2006        2,542,999,615,098               12.68 %

2005        2,256,902,590,825               11.31 %

2004        2,027,582,320,700               10.09 %

2003        1,841,832,751,026               10.03 %

2002        1,674,007,186,130               11.13%

So overall in real terms the Growth that China has now and in the near future is that same, or even greater than at the height of the mid-noughties growth as the base is so much bigger. It gives some context to bearish doom-mongers about the future of commodity and oil prices in the medium-term; there is still huge demand from China and it is in real terms still growing exponentially.

One week left for the Euro?

It was interesting to see the currency traders panic last week when the Swiss National Bank suddenly decided to end its policy of shadowing the Euro for the Swiss Franc (CHF). A net +30% revaluation was not a trade to be on the wrong side of - which of course the Swiss National Bank was.

Noticeable for me too was the supposed surprise of the move and the lack of understanding of why the Bank had given up the peg so suddenly. There was some thoughts of it getting to expensive to maintain.

But the reality is twofold. There is imminent Quantitative Easing for Euroland being loaded up. €550 billion euro's of it in theory. This will push down the value of the Euro (so beware a UK Sterling appreciation event on a smaller, but similar path to the CHF). Whay hang around with a a peg when your neighbours are about to ruin you. The SNB made the sane choice.

However, the second issue is the more important one, albeit related. Syriza are very likely to be in Power in Greece in one weeks time from now. It is even possible that they will have an outright majority.

Their, leader Alex Tsiparas, has declared that his policy is to negotiate a huge debt write down for Greece and to end the Troika imposed austerity that has so ruined the Country. Either Greece or Germany will win, even a compromise will be a victory for Greece really.

Syriza are maintaining that they do no want Greece to leave the Eurozone, however it is highly likely that Germany will try to force this through. otherwise the principles of sound money, if there is such a thing, are for the birds as far as the Euro is concerned.

To me, it is clear that the QE that is being revved up is being put in place to help manage the euro crisis that will out in a better manner than was possible in 2011. Back then the whole continent was plunged into a terrible crisis which could have wrecked many of its economies. This time it seems better preparations are being put in place. It will still be a roller-coaster rise no doubt.

As for poor Greece, there is no good end to the story. Tsiparas will be deeply unpopular if he leads Greece back to the drachma as this will entail the savings of the Country being wiped out entirely. Neither will be be popular if he negotiates only a partial deal with Europe that still leaves Greece with an untenable debt burden. So, as with most radicals, he will be forced to become centrist or mad. My bet would be on centrist which will come as a shock to many of his followers.

What Is University For? Weekend Rant

Reports that British universities now award Firsts to 19% of undergraduates, and 2:1s to 70% (sic), do not inspire confidence in their quality control, still less represent a cause for rejoicing at standards of tertiary education. 70%!

What     

          Is

               Going

                         On ??

Apparently, anyone graduating these days with a Desmond is no longer employable, so we are reduced to awarding a piece of paper that means no more than "(s)he didn't make so much of a nuisance of her/himself that we feel inclined to blight his/her life". 

In my day ...

In my day, less than 10% went to university anyway.  Now it's approaching 50% (bloody John Major, that was), what do we expect ?

The answer, of course, is that an undergraduate degree course is just the backdrop for a low-risk growing-up experience (of sorts) in much the same way as it is in America, where first degrees have long counted for almost nothing.   Post-grad work is what matters: and indeed all the best UK establishments are mostly concerned these days with attracting the best researchers and post-grad students, ideally from overseas and paying top-dollar.  (Or indeed some very dubious overseas post-grads, see the LSE Gadaffi scandal.)

Not only are undergraduates being allowed to twiddle their thumbs, they aren't even revolting, in the good old sense of getting noisy on behalf of free speech etc.  This chilling piece from the Speccie would be enough to indicate the whole game should be wound up, were it not for the strong suspicion it is somewhat overstated.

Prima facie, there would be scope for a major clear-out here, except that one would need first to figure out the economics.  Hundreds of thousands of kids are being suckered into borrowing tens of thousands of pounds, to support - what ?  A major employer of middle-class pseudo-academics and adminstrators, that's what.  NHS mk2, in other words.  Tamper with that at your peril.

Oh, and of course loads of these kids (a) will never repay the loan anyway - so it's just a taxpayer funded, public-sector merry-go-round:  (b) will, however, have learned at least one thing - a very dangerous blasé attitude to debt, the macro-outworkings of which won't be felt for a few years, but could be very bad indeed.

Gah !

ND

Al Murray: Pub bore politics.

Al Murray, comedian and author 

Al Murray is planning to stand in Thanet South to somehow help ensure Nigel Farage does not become an MP.  The labour activist comedian is hoping to draw UKIP supporters to his parody UKIP party, and so ensure freedom for Kent from right wingers by getting the Tories elected.

He took out a full page advert in a newspaper to publicise this fact. Not a national paper, mind. Nor a local coastal town, Kent newspaper. But a london free paper. So rather destroying any credibility he might have had and revealing the self-publicity that is behind the choice. 

Do oddballs and fanatics enliven the UK's dull election process? Do comedians and celebs joining in the political debate help to encourage voters to take an interest? Why are so many comedians left wing? 

I don't care.. What I do care about is Al Murray ruined my favourite program.

Why is Al Murray so bone achingly unfunny ? He's not even comical on a Lenny Henry level. At least Henry can front a show. Al Murray has no such talent. He is just dreadful. Existing in that Two pints of larger zone , where a program manages to run for years and years despite no one you ever meet having ever watched it.

I used to listen to a comedy-topical-news program on Sunday morning on radio 5. It was excellent. Chris Addison, the flowery shirted, skinny, specky one on Mock the Week. The junior Spad on the thick of it..You know the one.Comedian and actor. 7-Day Sunday its called.
The show, which had a team of sidekicks on it, and guests too .. Was a great show.
So much so that if I missed it I would hunt it out on iplayer. Something I never do for TV, never mind the poor cousin that is radio.
Then Mr Addison left, and the comedian, Al Murray, pub landlord took over.

Same format. Same ideas. Many of the same team. And it was awful. 

All the free flowing banter now sounded forced. Or was just absent. A show that I would have held up as an example of the best of British comedy was now so bad, that I no longer listened to it. In fact, if it  was on when I was in the car, I would now turn it off.

And not just because of his Labour politics.Lefty comedians are by the best comedians.  Stuart Lee is amazing. Mark Steel,  Eddie Izzard, Alexi Sayle all would merit a place in the Quango best comedians of the 20th century awards.

But Al Murray, even as a parody of UKIP Isn't funny. He wasn't funny doing this 'traditional Ukipper routine, when he toured with it many years ago..Even before there was a UKIP. . He is a lot less funny 20 years on. I can only guess that he is hoping to sign a new BBC contract or something. Hopefully they won't sign him for another 25 year stint as the resident comedian without portfolio.

So .. if it isn't already clear, I do not like the comedy of Mr Murray. This stupid stunt isn't even new. Lefty comedians have been standing in unwinnable seats for years.  Rufus Hound ran for the Liberals in London. Eddie Izzard..{you can't now stop him actually running somewhere for something}.  John O'Farrell, the last Tony Blair supporter left in Britain, stood in the 2013 by election in Eastleigh,. 
The main difference there being John O'Farrell is actually funny.
  
So Al Murray is not only unamusing. He is unoriginal too.

BBC Question Time : Unfunny Comedian's self publicity edition.

David Dimbleby presents topical debate from Lincoln. On the panel: Conservative defence minister Anna Soubry MP, Labour's shadow foreign secretary Douglas Alexander MP, president of the Liberal Democrats Baroness Brinton, journalist and broadcaster Mehdi Hasan and historian David Starkey.

Pretty sound lineup. Mehdi-Starkey should be a rematch of the third crusade.Only with a bit more bloodshed.

BQ suspects:
1..Je Suis Charlie. Mais pas sur SKY NEWS
2..Theresa May: She think the terrorists may have used a new technology called  Email. So she wants the power to read every email ever sent ever.
3..Israeli Ambassador .. Jews fleeing Paris. jews in London feeling threatened. Those Jewish 'police cars' That are you an anti-Semite poll.Turkish PM saying Hebdo was a Mossad attack to make Muslims look bad..Now let's all blur Palestine-Israel with fanatical Islam to really confuse the issue.
4. Al Murray- Publicity stunt for a fading comedian or a publicity stunt for a faded comedian..You decide.
5.Weaponise the NHS./ Was Miliband wise to use such a provocative word? This week of all weeks. The numpty.



  Scoring
1 or 2 points for each correct question asked. Depending on how close to the actual wording.
5 points for guessing the colour/design of  the Dimbleby tie.
 2 points for nearest match if no outright winner
1 point for each witty comment/excessive punning/ lampoon/mock/clever theme  that you put into the comments
1 point for the first entrant each week 
1 point for random other reasons

League Table 2015 

Hopper -1

Charity Shield winner - Malcolm Tucker.

 

More good news on the deflation front?

I really hated the Black Friday phenomenon that occurred in the UK last year. A traditional American holiday (er, Thanksgiving, from all of those emigrants so desperate to escape from Blighty?) which had been hijacked by retailers came over to the UK.

The resulting shopping fest was a bizarre confection.

Also, as we said at the time, it clearly showed how much retailers are struggling that they had to have sales right in the Christmas rush. After all, once you show your discounted prices, people are unlikely to buy again at the normal margins.

So it proved, with nearly all retailers suffering a bad set of Christmas results, the latest being Argos today. Diddums, it does means in real terms people did well at Christmas at the expense of the retailers! Hooray.

Also, perhaps the lesson will be learned by the retailers that pre-Xmas sales are only for the really failing stores, better pricing and holding your nerve will be the mantra next year. Maybe they will notice that in America the whole present giving on Christmas day thing is not at the same extreme levels that it is in the UK - hence the need for Black Friday and the timing of it.

No doubt, this mass discounting effort has also aided the steep drop in inflation to 0.5% that the UK experienced in the last quarter of 2014.

And lo, Black Friday can return to America whence it came.

Only a fool would raise rates now...so that is what the Bank of England are thinking about!

I have seen a lot of counter-deflation stories written as UK official inflation falls to 0.5% and the Eurozone teeters on deflation.

Deflation is not a great situation for the Country when we have such high public and personal debts; it means we have to pay them back. And in reality, no one likes to do that - they would rather have them inflate away over time. The net change is the same, but that's humanity for you as Hobbes nearly said.

Some commentators, including a chump called Ian Mcafferty who is on the Bank of England (BOE)Monetary policy committee, are trying to say raise interest rates now.

After all goes the argument, we have a zombie economy and people are too used to low, artificial, rates. Raising now they could cope with and we could put our economy onto a more sustainable footing plus ward off problems caused by wage inflation now that unemployment is a lot lower.

Oh dear, why can't economists ever change from their deeply held views when the facts change. When inflation for 4% and interest rates 1%, they had a point. When inflation is dropping and likely to fall further they world is a different place. There has a a huge inflation negative external shock from the drop in oil and other commodity prices.

There will be no inflation for months, maybe the whole year. Wage inflation is low, because companies are not doing well as demand has not recovered from the 2008 bubble pop. Neither exports or consumer demand is getting better. Debt is starting to rise because it is cheap and this is helping boost the economy a bit.

Raising rates now would stop the only growth there is dead, the EU could easily end up back in recession at the end of 2015. This will pull the UK down further and to below trend rate growth. Also we already have QE, we could try to unwind some of that first anyway which the BOE conveniently ignore, hoping it will be forgotten by everyone and then monetised at some distant point in the future.

I really hope the BOE improves under Mark Carney as the place was a totally car crash after Eddie George handed over Mervyn King who oversaw the worst ever crisis in 300 years, whilst never taking any of the blame at all! There is much to do though as they can't even seem to do basic analysis properly from their Ivory towers.

NHS death service redux

It is really sad to see how difficult decisions can be. I am often reminded of the old Michael Heseltine quote from the 1980's when discussing decline in the coal mining industry - there are no good choices, just bad or worse.

Fast forward to today and we have a big over-spend on unproven cancer drugs. We all know people who have died or are dying of cancer and naturally want the very best for them. The cost is eye-watering and with a £100 million overspend a task force was put in place to review the situation.

It was decided then to reduce spending on expensive unproven drugs and divert the money to more spending on cheaper and proven drugs.

This not controversial in any way, except if you believe in the magic money tree that money is irrelevant and everything should always be done. But if you do that, then after all the reports I have seen on Sierra Leone and the awful situation there, clearly there are greater needs elsewhere. This is where morality and reality clash.

So onto the NHS, Labour - having more or less admitted to 'weaponising' the NHS as part of the election strategy are keen to paint this as Tory cuts. The Tories are keen to point to the independent task for asked to look at this and to the benefits of clinical outcomes.

What is so frustrating is the black and white picture painted at the moment around the NHS. Either it is our national treasure or evil Tories want to destroy it. We have either the UK or US system.

There is no room or political space given to the mixed approaches tried in other countries or analysis of where other countries provide better systems and better care. Just an old, worn out dialectic between the well meaning nanny state or the evil capitalist market.

Brent Oil Price Stuffed - In More Ways Than One?

CU was right to remind all us oil consumers, merrily watching the price cratering, that there is UK industry at stake in all this: and as 'Suffragent' said in the comments (previous post), there is an accelerator-factor at work.  The development of small fields depends heavily on their being able to blister onto the infrastructure already built for (and paid for by) much larger, older fields.  If the latter fall off the perch sooner, the former rapidy become uneconomic at any price.

It just occurred to me, as price and UK production fall, there may be another sector at risk.

That 70% of the world's crude (and maybe an even higher proportion of oil forward and futures) is denominated relative to 'Brent' is one of those miracles of the City of London that are easily forgotten.  As 'price marker' for so much global oil, the Brent field in the North Sea is way, way past its prime, and 'Brent' oil has been a blend from several fields for decades now.  When that blend started to decline in volume, output from the mighty Forties complex was included in nominal 'Brent'; and when that in turn started waning beyond the point where physical delivery could readily be made available to any forward-market punter who actually wanted some (a tiny minority, to be sure, but the principle is important), two major Norwegian blend were enlisted.  And still it declines.

It so happens that Brent's one-time deadly rival, WTI of the USA, has been in dreadful trouble for several years, and has completely lost it as regards being of global significance.  (We looked at this ages ago; and at Alphaville they once talked of little else.)  But there are other would-be rivals: it has always irked the Arabs and the Russians that Brent dominates their vast output: and there are plenty of trading folk in the Far East who reckon they merit a crack at the lucrative oil sector.

So the vast and valuable Brent-based London oil market needs to have a care.  Last time we worried about this, it was market integrity that exercised us.  It has to be said, however, that a never-to-be reversed collapse in North Sea production (UK, and in due course Norway + Denmark) couldn't help the cause one bit.

The chaps in the City don't need me to tell the all this.  Given that further decline in output was inevitable, they will have contingency plans.  Hopefully, they are good enough to cater for a rather unexpected acceleration in the process.

ND