Father Ted: 30 years of comic joy

Some things that come your way are so engaging, they are automatically memorable, no effort required.  As with most memory-related issues, this is probably a stronger phenomenon with those of, errr, fewer years on the clock:  at a time where nobody could readily muster a tape recorder (and long before video), we'd all turn up at school reciting, word-perfect[1], the best lines of complete dialogue from the previous day's Round the Horn, Monty Python and Sorry I'll Read That Again.  And I can still give The Glidd of Glood (albeit that masterpiece is now available online now - but I've always been able to since first broadcast, long before ... etc etc).

Topping the charts, so far as I am concerned, is Father Ted.  So many extraordinary set-piece gags, many of them just a couple of seconds long [You let Dougal do a funeral?!], strung together in perfect half-hours strings of pure pearls.  And now it's been 30 years ...  scarcely seems possible.  Three short series, one superb Xmas Special; just 25 episodes.  And then Dermot Morgan dropped dead, 24 hours after filming the last one.  That's heavy stuff, as comedy goes.

A decade or so ago, business took me for a sustained period to Dublin.  To my delight, in the office where I was consulting, of a quiet moment[2] or in the staff canteen during lengthy ad hoc mid-morning breaks[3], someone would launch an apposite Father Ted line, and everyone would gleefully chorus the script that followed.  Happily, I was able to join in.  Taking care not to regale them with my attempt at an Oirish accent ... [4]  

Your nominations, please, for best Father Ted one-liner or five-second clip.  Here's a good one for starters.

ND

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[1]  At least that's how I, *ahem*, remember it ...

[2]  There were, just occasionally, quiet moments.  Mostly, it was uproarious.  A remarkable "working" environment - highly enjoyable & something of a career highlight in its unique way.

[3]  Over the massive rock cakes they would all eat.  "Mid-morning" pretty much started at 10:00. 

[4]  Unless the occasion called for the Cork accent, as some sketches do.  Dubliners (including Ted himself: A Song for Europe) affect not to be able to understand it, and they don't mind a bit of mockery in that direction.

PS: I can't resist one more story.  The department held a quiz night in a big upstairs room in one of those rickety pubs you get, even in the smarter reaches of Dublin.  Beer flowed, the craic was amazing.  Spot prizes were given throughout the proceedings, and one of these saw a likely lad summoned to the front to receive a smart little box.  This he ceremonially opened before the assembled host (senior management present), and exclaimed in disgust: Aaah, shoite! Feckin' commmpany cofflinks!  As they say in those parts, you Brits think Father Ted is comedy, but actually it's a documentary.

EDF and its nukes: "we're sh*t, and we know we are'

As so frequently stated hereabouts since forever (since 2007, to be precise), the whole point of French energy policy is to have someone else pay for France's humungous nuclear decommissioning liabilities. 

Now they'd like "negotiations" over Hinkley Point C and Sizewell C to be merged into one big financing deal.  Well, well.  

First of all, what "negotiations" are needed over HPC, pray?  We already have a definitive financing deal: a binding contract that clearly has EDF on the hook for the stonking cost overruns.  (Its alternative is to walk away: such is that inane deal, struck by the dickhead Osborne and signed by the fragrant May, that EDF is under no obligation to finish the thing at all.)  Do contracts signed by the French mean anything?  Silly question.

Second, why would we buy a second nuke - of the very same design - from the same imbeciles who clearly acknowledge they can't finish the first, under a different deal structure where we are on the hook for the inevitable overruns?

Is there any point in telling Starmer and Miliband to grow a pair - maybe just one pair between the two of them?  EDF are shit project managers; and successive governments have been shit negotiators.  Each deserves the other.

ND 

Self-sufficiency steel? Ore? Coal, oil ... gas storage ..?

The old debate we often return to, has surfaced again a propos of steel manufacturing.  To what extent is self-sufficiency in strategic commodities and capabilities to be maintained?  Procured?  Or even desired?  Some have strong inclinations to one extreme or the other, whatever the prevailing circumstances.  I tend to say that there's no immutable answer, no formulaic way of "optimising".  War and peace are critical input variables: but also the key given fixed externalities.  China has no oil, as I once diplomatically reminded a Chinese commissar who had just scorned Europe's enthusiasm for electricity interconnection and stated that a nation should not rely on imports of such a vital resource.

In the here and now, I and many others would put primary steel manufacturing on the strategic side of the line.  Clearly, Starmer has taken the same view at Scunthorpe (though curiously unmoved by Port Talbot, as the Welsh Nats bitterly remind him and indeed by Grangemouth / SNP), leading others to note that those vital "raw materials" we were all on the edge of our seats waiting for ten days ago, came from, errr, elsewhere (abroad).

Then comes Nils Pratley, extending the debate to gas storage and specifically, Centrica's huge offshore Rough storage facility.  Pratley is usually quite sound, and here he sets out a reasonably balanced range of pros and cons.

Steel was a security risk. What about UK gas storage? The government refused to allow steel furnaces to be turned off. Should it be happy with just six days of stored gas?

So here we go again.  

Nobody could disagree that now and for many years to come, gas ticks the 'strategic necessity' box.  Since we ceased to be self-sufficient in natural gas in terms of production from our own territorial waters (the early 00's), without any government intervention or subsidy the miracles of the free market secured a healthily diverse range of import sources and facilities through which to convey them.  How so?  We've told this story before.  

Because the decline of indigenous production could be, and was, seen coming a mile off, demand remained strong, and the companies involved were themselves strong, capable and confident. And that's where we are: able (as the energy crisis of 2021-3 showed) to withstand remarkable buffeting from the global market, and still keep homes warm.  For sure, the cost of doing so [i.e. paying world prices] was to some extent socialised, but the means of doing so were free-market means.  

And all this happened without Rough, which had been "permanently shut down" (© Centrica 2017 et seq) some years before as being uneconomic to its owners, the Tory government having more than once declined to bail them out.  But lo!  Miraculously, it transpired Rough had not been permanently shut down, but merely mothballed, and was rapidly pressed back into service by Centrica to avail itself of the profitable opportunities presented by Putin's gas crisis.

See, here's the problem in this very particular case: Centrica has form as a would-be subsidy-farmer.  That's the trouble with going down the "strategic" road.  Just like "green" or any other government-favoured enthusiasm, once the subsidies are spotted, every man-jack starts greenwashing / strategy-washing or whatever.  It becomes very hard to disentangle what could be a respectable strategic case from their self-interested special-pleadings.  

Even in 2025, with that recent crisis experience in hand, for all the ticks that natural gas puts in the 'strategic necessity' box, I'm not sure Centrica should be indulged.

ND 

Easter sermon: the 'religious' Russian character

Icon, pressed into military service        see Update note below:  (Russian MoD)

So Putin has graciously declared an Easter truce[1], doubtless hoping to impress the simpleton Witkoff.  A little while back we had a long thread in which the matter of judging Russian attitudes to this and that cropped up BTL.  I said I would add some additional thoughts to this suggestion regarding how Russian propaganda goes down with Russians:

[Russians] are, at the same time, (a) very good at reading between the lines; but (b) "believing" the crap, in some strange way. It's a bit like "well obviously this is crap, but it's our crap". I find this has religious echoes: "well obviously transubstantiation is, errr, a bit odd - but it's what we believe" Orwell, of course, suggested "Doublethink" as the technique involved. Western psychologists use "cognitive dissonance" - at least, when the doublethink is causing psychological disquiet: but that's what is notably missing from many Russians, which is why I reach for a religious-type explanation

There's an additional reason for religion coming into the account, and not just because today is Easter Sunday.  Russians are strikingly religious, with a small 'r', in ways that the ancients would have understood rather than how we understand it now in the west.  They are not even remotely all practising Christians, or "believers" as they they term it: that was thoroughly shaken out of the system by the militant atheism of 20th century communism (although a wholly quiescent Orthodox church survived, of course, even in Stalin's long reign; and he reignited it to a degree - for his own narrow purposes - during WW2).  But as, in their own way, is the case with many of Judaeo-Christian-heritage in the USA and Europe, Russians very clearly recognise their Orthodox heritage, which under Putin's regime (building on Yeltsin's) has been progressively bigged-up in several very public ways, including the rebuilding of a mighty cathedral in Moscow and Putin himself engaging in various devotional practices, consulting priests for omens etc.   

But the average Russian can also appear totally godless in their everyday behaviours and attitudes.  (Read this account of the extreme brutalism inherent in the Russian military, and by extension in society more generally.)  In what sense, then, are they 'religious'?  In short, I suggest it is in the same way that the ancient Romans insisted very forcefully on their own piety: by giving a form of recognition to superior powers - of some ill-defined nature: the gods, or the fates, if you like (Russians are nothing if not fatalistic) - powers that are "out there"; that are extremely powerful and, what's worse, capricious; and that demand from mortals respect , but not any particular ethical conduct or way of life.

Here's the thing that will come as a surprise to anyone not following Russian writings on the war in Ukraine.  There is a major, officially-endorsed campaign underway to make the war a religious crusade.  Two aspects will illustrate it: suspend your disbelief and research it for yourself if you find this hard to credit.

Firstly, no end of religious devices are being deployed in support of the war - going way beyond a bit of morale-boosting and comfort from the padre.  Well, they say there are no atheists in a fox-hole, but ...  The earthly remains of various saints and historic Russian figures are being circulated around the frontline - often, broken up into bits so as to increase the number of troops that can receive the spiritual benefit of close contact with these relics.  Crosses bearing Putin's initials are being distributed, particularly to troops in the most dangerous positions.  Priests are officiating at all manner of exorcisms and the conferring of blessings[2].  When these measures prove ineffective as, curiously, they often do[3], all manner of dark rumours circulate as to what it all portends.

Secondly, a campaign is underway to eliminate neo-paganism from the soldiery at the front. 

I need hardly go on: you already think I'm kidding.

Hence, why one might readily look for a 'religious' aspect in how propaganda works in Russia.  If it comes across as an edict from on high, well, the audience hasn't lost its cynicism or ability to detect BS[4].  But they are inclined to 'accept' it.  It's their BS.  Let Trump not imagine he readily knows how to deal with them.  

Happy Easter!  To believers and non-believers alike.

ND

UPDATE: as luck would have it, the Russian Ministry of Defence just published the above pictures, with announcement here.  What it doesn't tell you is that Putin has initialled this beautiful replica icon in two places: but it was decided not to include this aspect in the official announcement.  

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[1]  Kadryov's militant Islamic 'Akhmat' Chechen forces are flamboyantly breaking the Easter truce, and publishing videos, just to make the point

[2]  Here's Khinshtein, a Kremlin apparatchik appointed to oversee the 'liberation' of the Kursk region occupied for more than 6 months by Ukraine, having his office blessed 

[3]  Examples: (i) when bits of saints are blown to smithereens as the golf-cart conveying them to the front is hit; (ii) when priests conducted a ceremony on day three of a particularly problematic fire at an oil depot, in order to advance the work of extinguishing the blaze; whereupon one of the fuel tanks promptly exploded and the fire burned for more than a week thereafter.  (Have you made contact with the right side, oh hieromonk?)

[4]  Russian milbloggers often provide assistance for those who can't decode it for themselves.  I particularly enjoyed the acid comment following one of the endless reports of a drone being shot down over a Russian oil facility with "fragments of the destroyed drone causing a fire".  Shooting down a drone directly over the target like that, the milblogger drily opined, "is a posthumous achievement". 

"... knows one sex from the other ..."

My tiny baby brother

has never read a book

Knows one sex from the other

all he has to do is look

Doin' a-What Comes Naturally**, from Annie Get Your Gun

Well yes.  And we get there in the end (if I may use that phrase) as the Supreme Court makes an intelligent ruling on a key aspect of the trans nonsense.  It remains to unhook the NHS from that lunacy.

There are two aspects to this I find very interesting.  Firstly, not so long ago the mainstream progressive left had been wholly captured by the "Self-ID Trans" madness, so that it was de rigeur to mouth "some men have a cervix / some women have a penis" etc etc.  I had this down as a shibboleth, a marker of progressive belonging, being so deliberately crazy that it took a major effort of intellectual self-abasement to adopt it - like any uncomfortable initiation test.  Yes, in order to be a Catholic in the Middle Ages you had to sign up for literal transubstantiation; and to be one of the Progressive gang, you are obliged to pretend you believe that a trans woman is literally a woman.  Well, make that "are" into a "were", because I don't detect any of that on the mainstream left just now (though still perhaps amongst the Greens?)  Mercifully, it evaporated some time over the last 12 months or so - something to do with the General Election, I'm guessing.  A very big relief to many, we may be sure.

Second, however, is something that seems to be taking its place, and might possibly be around a bit longer.  There seems now to be a reaction of, well, the Supreme Court's ruling is what it is, but the whole matter is so complex and "granular", it doesn't resolve the myriad of practical questions.  The efforts made to make the waters seem as muddy as possible range from the properly nuanced to outright sophistry.

Armed with the SC ruling as a thoroughly commonsense-affirming breakthrough, we can cut through this second-tier crap relatively easily by noting that society often has annoying problems when willful, sometimes rather unfortunate people are determined to behave oddly, noisily and angrily in public.  Can these ever be resolved by the Supreme Court?  Well, no.  It's not the SC's job, but rather, the thankless task of unfortunate school teachers, policemen, NHS staff, HR directors etc etc.  As with stroppy children, be they genuinely disturbed or just playing up, the key is to steer them gently but firmly and confidently into some sensible, pragmatic, quietist outcome.  Easier said than done, I know - but it's the eternal (and hopefully only occasional) lot of responsible adults.

ND

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** The film version of this song is slightly bowdlerised: the original contained some fruitier verses 

British Steel [2]: where IS *Immingham*?

As recounted here before, in every energy co I worked for I always took every sensible opportunity to visit the plant - and make my staff do the same.  In an intrinsically physical business, a decent first-hand understanding of the hardware, the people that operate it, and the issues they must deal with, is IMHO damn' important for every one of a multitude of reasons.  (That includes getting the most and the best out of those folks on a sustained and sustainable basis, BTW.) 

With that as one's attitude, one quickly gets to share the disdain of the folks at the plant for those who treat the industrial nitty-gritty as something rather alien that happens somewhere, who-knows-quite-where, but in any case a long way from London & the Home Counties.  Is "Teeside" on the River Tee, perhaps?  It is in this spirit that over the past few days I have caught two different broadcasters offering the following couple of gems:

    "Scunthorpe get its raw materials** from somewhere called Immingham ..."

    "... the port of Immingham, in the North East of England"

That would be, errr, the second largest port by tonnage in the UK - wherever this obscure place might actually be.  Finally and at last, today I heard "... from Immingham, 20 miles to the East".  A simple and correct relativistic formulation which absolves them from knowing where either town actually is.  

Of course it's also somewhat rich to hear Greens and progressives of the non-labourist ilk eulogising belatedly over retaining a domestic, coal-fuelled virgin steel manufacturing capability, for building all that wonderful Net Zero kit, new houses etc etc, doncha know?  Well yes, here at C@W and its BTL friends, we always did know.  Pig-ignorant metro-gits.

ND

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** I swear the whole weekend went past without that convenient blanket euphemism "raw materials" being explicated as dirty old iron ore and COAL 

Are they mad? The new legislation on British Steel

Extremely odd things are happening all over just now and perhaps we are becoming inured to disturbing novelty.  In the UK, some might date this to 2015 and the rise of Corbyn, passing through Brexit, in an ever-rising, ever-accelerating crescendo of covid, Ukraine and now the daily lunacies of Trump.

Personally, however, I have rarely been more shocked than when I read this today: 

Emergency legislation allowing the government to instruct companies to keep loss-making steel operations in England open, or face criminal penalties for their executives, were passed yesterday during an extraordinary sitting of parliament.

For context: I bow to no man on the strategic imperative of being able to make steel in this country.  (Obviously, not everyone need agree.)  Nor do I object to swift and decisive use of the levers of power: in fact, more often I am criticising the inertia and lack of imagination of those who hold those levers limply in their idle hands.  

And I don't have the time to read up on the exact legislation in full, which may, I suppose, in the round be less shocking than the above summary suggests.  

But ... criminal penalties?  For an economic "offence"?  Obviously, there are such liabilities upon employers that flout health and safety regulations.  But financial affairs are intrinsically civil matters: are there any other even vaguely equivalent precedents?  The "personal liability" precedent that came immediately to mind to this former councillor was Thatcher's legislation on local authorities: to prevent rogue "socialist" councils like Lambeth and Liverpool from taking the piss at annual budget time, she made the chief finance officer personally liable for balancing the budget, with powers granted to the said official to impose balance if the democratically elected members persisted in mulishly voting for infeasible financial plans.  But these were not criminal matters.  Is Starmer proposing to bang up Chinese nationals ..?  Who was it that thought a sober grey lawyer would at least bring stable, rule-of-law government to the land?

Legislate in haste, repent at leisure.  In the wrong hands this precedent will be a joy to every mad leftist and green in the land.  You pick a piece of policy, and declare it a criminal offence to carry out any act inconvenient for said policy, property rights be damned.  What am I bid for failure to install heat pumps?  "Well, climate change threatens the well-being of everyone on the planet, it's preventing genocide we are talking about here!  It's obviously a criminal matter!!"   You can generate further nightmares for yourself.  Or indeed, generate a few prime candidates of your own for criminalisation!  It needn't only be leftists that play the game: we can all join in, see how they like that.  We are constrained only by the limitations of our imagination. 

Am I alone in my state of shock at all this?  Or do I just need to read the whole thing properly, and calm down?

ND

Volatility rules!

VOLATILITY is a bit of a speciality of mine.  When natural gas was first traded, that was in the teeth of assertions from certain no-nothing economists, purely on fallacious a priori grounds, that gas was a "paradigm case" of a commodity that could not be traded.  The market price routinely exhibited vol that was unparalleled for a liquid traded asset (barring the odd rogue stock), and the economists crowed: there you go, this is set for crash-and-burn.  But as the market matured, and was self-evidently not crashing / burning, and the vol persisted ... it became apparent that it was a feature, not a bug, for which reasons can be adduced.  The maths of gas market price-formation and vol was quickly established, and everyone with a stomach for roller-coasters settled down to enjoy the ride.

When electricity was first traded, well, that was considered  even more deeply impossible by the aforesaid eejits.  And electricity prices manifest vol that was completely off the scale - some three orders of magnitude higher than previously encountered anywhere (except nat gas - just one to two orders higher).  And the maths of elec price formation proved much more difficult to establish.  But established it was, and off we went.

It is first-hand experience of all this that informs what follows.

1.  Volatility is like heartbeat, or (switching idioms) friction.  No heartbeat = no life.  No friction = no traction.  But too high a heartbeat, and you're also looking at death.  Too much friction, and you are looking at everything grinding to a halt.

2.  Some folks benefit from vol:

(a) those who've placed market bets on vol, which is fairly easy to do if you understand financial derivatives.  Easiest of all, for stocks & shares there is the "fear index", a.k.a the CBOE Volatility Index (VIX).  Needless to say, this is riding high right now.

More generally, for those to whom these terms are familiar, you can put on long calls and an equal number of long puts, with the strike-price either at, or either side of, the current price (depending on your precise strategy and how much premium you are willing to pay).

(b) those who've invested in 'flexibility' assets, a.k.a optionality in the financial jargon; e.g. (in my neck of the woods) a flexible oil refinery (which can benefit from volatility in the prices of crude oil and finished products); a flexible gas-fired power station (prices of gas, power and carbon); a flexible gas storage facility or electricity battery (prices of gas / elec now, and forward prices of gas / elec for forward time periods; a flexible power interconnector (prices of elec here, and over there) etc etc etc.  As vol goes up, the value of your option-asset goes up.  As Black & Scholes proved, in their Nobel-prize-winning work, vol is a primary component of option value.

 3.  For everyone else, high vol, like high friction, is unequivocally a cost.  And eventually, when we reach the upper end of the heartbeat / friction spectrum it weighs on everyone.  The cry of "risk off" goes up, and big players withdraw from the market, at which point another critical variable - liquidity - starts to loom very large.  There are b-a-d things down that path, too.  Don't let the know-nothing optimists tell you this is all for the best in a funny sort of way.  It ain't.  It's unequivocally bad.

Much more of Trump's casual lunacy and I think that end is in sight.

ND

Estate agents: getting "creative" again ...

... but this time with a pair of expensive new-builds and the CGI set to "turbo-bollocks".

Our previous two gems of the estate agent's art featured creative euphemisms for "surrounded by dense woodland and distinctly short on basic amenities" in the vicinity of Schloss Drew.  This, also in Croydon, is different:  we're moving to the brave newbuild world of 7-bedroom, 6-bathroom, 4,000 sq ft Executive Housing, smack on the A232 - a very busy main road that boasts five bus routes passing the front door sorry, good transportation links.  Only smart CGI is good enough for these.

"... proudly occupying an enviable raised position"

Looking nice, eh?  As well they might be, this "grand opus of luxury living ... pinnacle of sophistication" is asking £1.7 million** for each.  But look carefully: any sign of a garage or two for these upscale dwellings on a main road?  Errr, that would be 'No': all you get is "Parking space - driveway" - and for the left-hand one, a very modest driveway it is, too, down the side: enough for just a single car by the looks of it, maybe two - in tandem - at a pinch.  And a fine feat of reversing will be required for the one on the right, because the only road access is via the ramp on the left, and thence on up across the front of both houses.  And this is for 7-bedroom houses, FFS.

Now: consider the access driveway ramp to that "enviable raised position".  Nice broad gentle slope, fairly scenic?  A gentle rise of 8 steps, past grass and bushes, for pedestrian access to the front door?  Enough of the CGI, here's a photo of the thing taken today.  That front retaining wall is an absolute necessity for the looming mound behind, especially over on the right where the number of steps is 12, not 8 (11 steps on the left).  If anything that ramp off the main road is even steeper than it looks here: "pinnacle" indeed. 

The garden at the back is precipitous, too.  And just to round things off, here's another actual photo - from the estate agent this time, boasting of a "leafy outlook" to the front. 

Errr, yeah, in summer when the leaves are out, if you confine your gaze to the street-side plane-tree top-cover.  Otherwise, it's a procession of bright red double-decker buses.

The only saving grace, I suppose, is that folks always do their DD for a house purchase in person.  Don't they ..?

ND

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** by way of calibration to local prices, £1.4m will buy you this, on the genuinely prestigious estate on the hilltop directly behind the above new-builds, but comfortably off the main road.  

1930's: a bit dated but very solid build, these properties buff up beautifully for a couple of hundred grand: splendid garden: all on the level: backing on to a fine park: immaculate - check it out.  And, errr, no shortage of parking!

Photo credits:  the last pic is ShineRocks estate agents.  If the copyright holder of the CGI confection above would like to be credited, just drop me a note in the comments and we'll be happy to name you.

"UK to be Superpower" & other Starmerite nonsense

Those few very-longtime readers we still attract, might recall I spent a while on business in The Gambia a decade ago, and very educational it was, too.  One of the things I learned was that by the time of roundabout now (i.e. 2025) The Gambia would have become an *Economic Superpower*.  Sic!  You can read about it here, in this rambling presidential state-of-the-nation address of the time from His Excellency Sheikh Professor Alhaji Dr Yahya Jammeh Babili Mansa. 

And what a state the nation was in!  (E.g. no 'phones in my "4-star" Sheraton, no reliable electricity, etc etc.)  But I think his noble mission has failed.  He's no longer around to carry the can, however: he was deposed shortly afterwards in an unusually peaceful coup.

Which brings us to Starmer, Reeves, Miliband, and their curious brand of self-aggrandizing nonsense.  First, you recall, we are to become a "Clean Energy Superpower" - by 2030, I believe.  That's without having a manufacturing base for solar panels, wind turbines, even steel these days (can we still manage concrete?), nor a workforce of adequate skills or size.  Perhaps "clean-energy-equipment importing superpower"?  But it doesn't have quite the same grandiose ring, does it?  Everyone in the government photo (from the link above) seems to think it's pretty funny, and I'm sure we all get the joke.

What, and defence too?  Minister, stop, I'll wet myself!!  

Anyhow, not satisfied with this newly-minted aspirational status, we are also now to become a "Defence Industrial Superpower"!  And that, too, without, errr, a manufacturing base for chips, steel, ... etc etc. 

Amazing stuff.  I am sure the rest of the world's minor powers are shaking in their boots.  With laughter.  Meanwhile, our bold triumvirate of superpower-mongers might care to study the fate of his Gambian Excellency.  

ND

Business Blunderers #1 - cont: it gets funnier

Continuing the story of Sir Archibald Forster's Big Business Blunders ...

For a period in the 1980s, the old monopoly British Gas had been paying ever higher prices for new long-term purchase contracts from North Sea gas producers: it was a sellers' market.  This came about from an archetypal monopoly planning cock-up: they'd contracted vast quantities of gas in long-term contracts during the huge boom of the late 1960's, priced in single-digit pennies per therm.  Being thus sated, they'd bought very little in the 1970s.  One day, they re-did the supply/demand sums and noticed - guess what? - a looming shortage!  Owing to the low gas price and, at the same time, booming oil prices after the twin crises of 1973-4 and 1979, everybody was exploring only those hydrocarbon plays that looked set to yield oil.  And new gas developments take several years to bring on stream.  

So, being a monopoly and not caring what things cost (they know who's gonna foot the bill, haha!), BG did the rounds, telling everyone that they'd be willing to pay more than 20 p/th - a gigantic price increase - for any new gas supplies that anyone could develop.  (The output of an entire field would be sold under a single contract for decades of delivery, years in advance.)  This sent every NS producer back into the vaults where they stored their old drilling logs, looking for long-forgotten gas discoveries they’d ignored as being totally uneconomic at those 1960’s prices.  Sure enough, new gas fields began to be offered and, true to its word, BG started a price-ramp of several years for new gas that by the mid 1980s saw prices in the high 20s of p/th.  A classic sellers' market phase in the great commodities cycle. 

Though no gas expert, Archie, headstrong Esso Chairman & CEO, somehow got it into his head there was no end to this ramp.  Esso had enjoyed a couple of big sales at stonking prices in this period, and one of his JVs now had a couple more new gas fields to offer BG.  Forster decided that he would triumphantly be the first to breach 30 p/th.  He convinced the JV partners to go along with an eye-watering opening offer of 34p.  Many of us were unconvinced, but were willing to go along for the ride.   Unfortunately, thus emboldened, Forster flamboyantly guaranteed to his Exxon overlords that a price in the 30s would in due course be delivered.  Sadly, he’d failed to notice the laws of supply and demand grinding slowly into action.  High prices bring forth, errr, lots of supply; and he’d not heeded warnings that a glut was coming inexorably down the production-line.  

When his hapless negotiators rocked up at BG, in response they got given a long and detailed list of new fields currently on offer.  BG stated it would only need to buy a couple of these, and told them to go away and recalibrate their aspirations to less than half of what they’d walked in the door with.  Yep, we were now in a buyer's market.

Cue carnage at Esso: was this right?  Why didn’t "we" see this coming?  Etc etc - the usual search for scapegoats.  It would have been fun to be a fly on the wall when Archie broke the fell news to his US masters; but BG was right: it was indeed sitting on a glut, as a bit of belated due diligence readily confirmed.  For its new gas fields Esso subsequently settled for 16 p/th**.  A salutary tale indeed. 

So many life-lessons - as my 11-year old granddaughter would say.

ND

________________

**  There's another lesson here.  In order to "justify" asking for 34p/th, the negotiators had been primed to say that detailed engineering confirmed this was nothing more than was needed, based on the ever-rising cost of offshore development.  Gosh, yes.  The JV had indeed concluded internally that a price in the high '20s was needed, even if 34 was taking the piss.  So: how come we didn't pack our bags and just go home, sadder and wiser, and leave the stuff in the ground?  

Answer: huge engineering projects build up serious momentum (see HS2, Sizewell C etc etc).  Big project teams had already been assembled: plum jobs awarded: a great deal of engineering work already done: we were not about to walk away from these sunk costs.  The teams were told to take out their sharpest pencils and bring the costs down - massively.  And lo - they succeeded!   As I've found many, many times in business life, engineers, like so many of the rest of us, are basically lazy and complacent; and if they think money is no object, they pile it on.  ("Safety" is the usual reason given for gold-plating - and who dares to second-guess them on that?)  But if they are told their jobs depend on it, suddenly they are capable of amazing innovation and rationalisation!  It is ever thus.  Only a good kicking does the job.

Miliband's perfect positioning

By way of elaboration on my assertion last week that Miliband can't remotely be discounted should Starmer topple in the near future, look at this telling chart from the loyalist LabourList platform and its Survation polling:

Survation / LabourList:     click link above for full-size

Every Cabinet member has seen their ratings fall after Reeve's efforts of last week: but L'il Ed's fell the least by far; and with Rayner heading west with all the rest, he's now miles out in front with Labour supporters.

He'll be making very careful decisions in the event his damn-fool energy policy dreams come under even more pressure from Reeves and her Growth-At-Any-Cost strategies.  Would yet another serious slap in the face be the ideal time to quit?  Or exactly the moment not to rise to the bait, and to hang on grimly instead, making the usual offstage noises and pointed absences that ensure everyone knows his true feelings?  The almost-iron rule of UK leadership elections is that Leaders of the two main parties only ever come from the ranks of the Cabinet / Shadow Cab.  And whilst in government, when the Chosen One becomes PM immediately?  That really is an iron rule.**

ND

__________________

** The Corbyn Exception relates, of course, to a period of opposition - and even that needs qualifying for special circumstances, because there was only a 'shadow-shadow' cabinet in being during the short inter regnum of Harriet Harman, following the resignation of, errrr, one Ed Miliband.

Trump's Tariffs: the uselessness of economists

I heard a nice joke the other day:  

After astrology, came astronomy.  After alchemy, came chemistry.  And after economics ..? 

The world has been watching and waiting in a state of fear and loathing for Trump's long-awaited, bizarrely-telegraphed barrage of punches.  What will happen now?

To me, the hilarious aspect is that nobody has a clue.  I suppose everyone agrees it will act as a brake on world trade.  Well, duh.   OK, and ... ?

If macro-economics means anything whatsoever by way of a 'science', there should be a definitive answer when such extreme measures are taken.  And to me, an avowed econo-skeptic, this all looks to be as significant as, say, the oil-price hike of 1973-4. 

Anyone round here got anything better?  What we're after is solid, unequivocal, drop-dead economy-related predictions beyond the short-term and the trivial.

ND

Business Blunderers I Have Known (1)

Continuing from Jailbirds and Rogues ...

Archie Forster (Sir Archibald, 1928-2001) was Chairman / CEO etc of Esso = Exxon-in-the-UK.  I met him occasionally, he being the top Esso participant in a joint venture I was involved with.  He was a cheerful, bustling cove, but his business history told clearly of a dynamic and steely character, with much conventional success along the way (within the one-company career - and Exxon is an odd company). 

Once he got to the top, however, there were reasons to doubt his judgement and what must have been a heads-down, over-confident, solo decision making style ...  

The first story revolves around his determination to cash in the very valuable SW1 HQ property Esso occupied for many years - 1,200 people, multi-storey carpark, occupying more than an entire block on Victoria Street - and move somewhere cheaper.  Esso's geography dictated somewhere west and possibly south of London: its worldscale refinery is at Fawley, near Southampton;  it had a smaller refinery at Milford Haven; a research centre at Abingdon; and, not coincidentally, Forster lived in Winchester.  When we met Esso folks, they'd give us the latest office relocation update like Father Ted used to update Dougal on tales from the confessional: although it was meant to be secret, all the Esso guys had their contacts in the company treasury who would tell them the addresses of where they were sending the latest batch of cheques made payable to estate agents.  And so we learned of the search progressing along the M4 corridor, right out to Swindon - but seemingly there was something wrong with all of the sites they were offered.

Suddenly, a breakthrough!   A big, cheap, brownfield site (the old Goblin Teasmade factory) became available near Leatherhead, right on the M25, on the London side of the motorway.  Forster was delighted.  Excellent transport links; south-westerly from London; and, he had heard from somewhere, if the move was within the M25 - and it was, just - no redundancy would need to be paid to staff that didn't want to leave SW1.  Shedding staff without cost was part of the cunning plan.

Boy, was he wrong.  (a) The 16 miles between SW1 and Goblin is far further than a move which is of such short distance, it lets you off making redundancy payments.  Oh, and (b) although smack on the M25, it was not on a junction, and the nearest one is an absolute pig at rush hour.  Loads of staff considered Leatherhead / M25 a much different proposition to the comfortable public-transport journey to Victoria SW1, and took the money.  Being an upfront cost, the fat redundancy bill significantly impaired the deemed economic benefits of the relocation exercise, even if losing staff was part of the plan.  But he ploughed on anyway.

Embarrassing enough for his dealings with his masters in Florham Park NJ: but the second tale is, if anything, even funnier worse ...  to be continued.

ND

Welby: a man with no brain speaks ...

"Every day more cases were coming across the desk that had been in the past, hadn't been dealt with adequately, and this was just, it was another case - and yes I knew Smyth but it was absolutely overwhelming"    J Welby, 2025

There was an old woman

Who lived in a shoe

There were so many perverts

He didn’t know what to do

So he busied himself

With the wine and the bread

And let them off lightly

And went back to bed

ND

Labour leadership stakes: rats-in-sack update

It's two months ago since we last looked at the jockeying for position going on in the Cabinet.  At that time we cast our eyes over Reeves (nobody's idea of the next leader, then or now); Streeting (obviously positioning himself actively); Lammy (radiating ambition); and Rayner (also ambitious but actually a joke).  For completeness, we mentioned Khan (permanently on the lookout for the Main Chance); Miliband (radiating competence); and Mandelson (devious and unpredictable as ever).

How do things look now?  The Grauniad has a telling, tearful piece, avowedly briefed by the wimmin: and it's worth quoting a couple of chunks. 

... a female minister spoke directly to the prime minister to complain about the leaks and briefings she saw directed against other women ... including Bridget Phillipson, Liz Kendall, and Yvette Cooper .,. “Cabinet really no longer feels like a safe space for genuine debate,” one minister said ... after weeks of tension felt by some women in the cabinet... Almost a dozen female Labour MPs who spoke to the Guardian said they were unnerved at how female cabinet ministers appeared to be getting the brunt of the blame for issues in government – though there is less sympathy for the chancellor, Rachel Reeves, because of anger over the Treasury’s handling of spending cuts and welfare. Among some of the new intake of MPs, there is a strong feeling that any ultimate successor to Starmer should be a woman – and a resentment of what they see as a campaign to anoint Wes Streeting.

Hahah!  More popcorn supplies, please.  It goes on: 

At the moment [Streeting] has no obvious female rival as the heir apparent. Senior cabinet ministers who did not want to see Streeting win had previously coalesced around Reeves, but her unpopular decisions as chancellor have meant that is no longer the case. Other ministers would back Rayner, but she would face a brutal press onslaught. Among Labour members there is no doubt, however. Rayner is streets ahead of her rivals in terms of popularity with the grassroots ... There is only one cabinet minister ahead of her, who is probably the least likely of anyone around the table to have another shot at the top job – Ed Miliband.

This is not intelligent commentary.  First, selecting the next leader when there's no vacancy is well-known to be an absolute mug's game.  Genuine, nailed-on heirs-apparent are few and far between in British politics (in the past century or more, only Anthony Eden and Gordon Brown).  

Second, Miliband is not at all the least likely to have another shot.  In countries like France and Italy he would be the number one contender in everyone's books: competent (at politics, that is), confident, popular, experienced, sure-footed, intelligent, and comfortably dynamic enough.  And he has the green-left eating out of his hand - potentially deemed a vital constituency when the Green Party is snapping around Labour's heels in such politically volatile circumstances.  That's how he'd be marketed, anyhow. 

A couple more comments.  (a)  You just can't rule out Khan or Burnham.  These guys' ambition and political capital is so great.  Safe seats aren't so hard to find in a hurry: Boris always found one at the drop of a hat.

(b) Having mentioned the Prince of Darkness last time and just out of interest, I have it on good authority Mandelson has already f****d up royally in Washington.  Of course, he's made comebacks in the past from many an appalling situation of his own making, so who knows?  But right now, his political capital is deep in the red.

Oh, and Lammy?  Speaking of in-the-red, he's so far out of the money right now, I almost forgot him.

ND  

Is 'Trumpism' an ideology? Ye-es, but ...

When I first joined the Conservative Party as a teenager, many long years ago, the opening sentence of the rules read thus:  

Membership of the Conservative Party is open to anyone who opposes Socialism and Communism ..."

And there you have it in a nutshell.  Conservatism, and the Right in politics generally, isn't really any kind of ideology - it even has to define itself negatively, by what it's opposed to.  It's essentially an unintellectual, not-very-articulate Burkean tendency.  Genuinely articulate Rightists such as Roger Scruton are few and far between - and they don't have cults, cliques and followers.  Leftists, who really are ideologues and can't envisage any other way of life, spit out words like 'capitalism' as if that, too, is a competing ideology - and that's an ignorant misunderstanding, too.  'Thatcherism'?  Not really: Keith Joseph notwithstanding, Thatcher's was a forceful petite bourgeois tendency on HRT.  'Reaganism'?  Not much up top, is there? - as Thatcher herself said.  'Gaullism'?  Nah - just nationalism.  'Neo-liberalism'?  If anything, an expression of the desire to clear the decks for some fairly aggressive money-making.  Etc etc etc.

So if you'd asked me any time up until very recently, I'd have said that in my political lifetime the Right has been essentially non-ideological.  Frustrating for the Left because, for all their fervour, ratiocination and well-written 5,000-word essays peppered with nicely-turned neologisms, they've nothing intellectual to grapple with except the splitters in the other Leftist factions. 

Until very recently.  Because now, it's quite evident from the voluminous output of what we might loosely call the 'Trumpite' camp, there is thinking going on that is identifiably ideological.

Of course, it's also messily bound up with some entirely mercenary motives; and as with any broad movement, one can readily discern several camps whose varying emphases in their pro-Trump enthusiasms are really quite different - the makings of fissures and splits yet to become a serious problem for The Donald's regime; but that will come.  IMHO it's rather too early to attempt to systematise all this; but it's brewing up to a point where one will be able to.**  There are some early attempts at articulation - here's one - but not perhaps very convincing yet.  (This of course isn't to be marvelled at, because being essentially Right-ish, the whole Trump thing will have a strong tendency to inarticulacy.)   

Meanwhile, as all this is slowly coagulating into something with defined contours we can pin down and gaze at, we face the sobering fact that many of its leading lights in the highest of high places are unhinged, messianic, in a massive hurry, drunk on power, and untouched by normal considerations of prudence.  We need no better evidence than the truly amazing spectacle of grown men in high office, with all the resources in the world should they care to use them with due deliberation, conducting their communications like a bunch of doped-up teenagers on their mobile 'phones plotting a Friday-night fight with a neighbouring crew.  The average County Lines drugs gang isn't as crass in its actions as these high-ranking promoters of the Trumpian Flame.  FFS, what is to become of the 'Free World'?

ND  

___________

** if anyone knows of a good early attempt to do this, or would care to try themselves in less than, say, 100 words, we'd all like to know!

"The mother of all rebellions" ...

... if Starmer doesn't back down on PIP etc.  Oh yeah?  Way back in the summer we noted that Starmer had come down hard (very hard, in terms of precedent) on the first batch of rebels, by way of a softening-up of backbenchers for even tougher decisions to come.  (That one was over the 2-child limit.)   Here's how we concluded then:

Many of them must be trembling at the thought of what they're going to be told to vote for.  The Smack of Firm Government, eh?  And a summer of riots still to come ...  Kier "I banged them all up in 2011" Starmer will be in his element.

Needless to say, La Toynbee has been hyperventilating with her usual subtle mixture of crazy optimisim and severe disapproval.  Popcorn supplies having long since been laid in, let's see what happens. 

ND

The economic power of boycotting Musk et al

Gotta chuckle when the Tesla stock price slumps:  that's the language they understand & they don't like it up 'em.  An "illegal boycott", Mr President?  Never heard of such a thing.  Fashion is a much underestimated economic force.  Plenty of folks across the entire planet, including within USA itself, aren't going to rush to take any Trump-endorsing purchasing decisions.

For a century or more, Corporate America has been the mighty beneficiary of what have effectively been pro-US-lifestyle fashion choices across the globe, from the colas to Hollywood to Disney to Nike and a thousand more.  These things can change - and real quick, too: decisions on consumer durables are daily, by the billion.  Suppose Tesla is just a harbinger, eh, Mr Apple ..?

See, capitalism can address issues other political & diplomatic forces are relatively impotent to affect.

ND 

Putin's wartime wardrobe

Impressive, or what?

So what does Li'l Volodya don for his expedition to a safe corner of Kursk?  Yep, the khaki hi-neck teeshirt and fatigues.  (At least he kept his top on.)  Is he trying to channel anyone that Trump might have met recently?  Why?!

The really funny thing is that the video clips and stills of his soldier-boy "visit to the front" shown on Russian TV were of poor quality.  Instead of ignoring this glitch, or even revelling in the cinéma vérité realism of the situation Putin, ever one for a carefully curated image in the style he feels is appropriate for his status as co-equal of Trump and Xi, had his spokesman bluster defensively about it in a press conference.  Do they not realise it makes them look even more phoney?

Let's see how Putin's "Yes but No" response to a ceasefire goes down with Trump.  The Donald will certainly want someone to blame if his "fighting stops within 100 days" boast doesn't come about.

ND

Epochal change in our economic situation

What are the epochal economic changes in my lifetime?  I'm no student of macroeconomics, as any reader here will know, so I don't have a ready list.  The rise of China comes first to mind, along with its concomitant, the (relative) de-industrialisation of the West, and its precursor, the collapse of (left-wing / doctrinal) communism.  The oil crises of the 1970s.  Economic migration towards the West and the suppression of labour costs.  And ... economic "neoliberalism"?  The period of the "great moderation"? - maybe.  The banking crisis 2007-09? - not really: what changed?  Any others people care to nominate?  [I'm not looking for lists of new technologies here.] 

Anyhow, now we have a serious new candidate: the Keynsian turn of Germany announced just days ago, which is probably just the cornerstone of the EU letting rip, as many in the EC and several member countries have wanted to for decades now.  So much latent borrowing power!  Assuming it actually happens as presaged, expenditure on weaponry (of course) but also infrastructure, stands to become a truly massive boom, with the added twist that there could be a strong strategic reluctance to outsource all this upsurge in manufacturing and construction to China.

The markets don't think it all looks so obviously great for the USA, either: are we seeing the turning-point in a 25-year bull run on the DJ, and maybe early suggestions of the USD going out of favour?  US recession, even, as the tariffs bite?  Nice one, Donald - though at least there will be plenty of ongoing demand for his natural gas.  

Writing as a non-economist, I'd say that the whole thing also sounds rather inflationary, too - for all of us.   The older I get, the gladder I am for my substantial inflation-hedge. 

What do we all reckon, at this critical juncture? 

ND

PS - did you notice the Irish offered themselves as part of the Macron/Starmer coalition of the willing?!  See, this is real ! 

"Might is Right": the Melian dialogue

I don't want to insult t'readership by assuming you don't know all this, but ... 

 Athenians : ... you should try to get what it is possible for you to get, taking into consideration what we both really do think; since you know as well as we do that, when these matters are discussed by practical people, the standard of justice depends on the equality of power to compel and that in fact the strong do what they have the power to do and the weak accept what they have to accept. 

Melians : ... we who are still free would show ourselves great cowards and weaklings if we failed to face everything that comes rather than submit to slavery. 

Athenians : No, not if you are sensible. This is no fair fight, with honour on one side and shame on the other. It is rather a question of saving your lives and not resisting those who are far too strong for you... if one follows one’s self-interest one wants to be safe, whereas the path of justice and honour involves one in danger.

There's nothing new under the sun.  Xi hs always explicitly espoused this.  It's always possible as a policy.  What's to oppose it?  Only self-restraint, based (ideally) on nobility and strength of moral character, but otherwise on proper consideration of the long term.  But for Old Men in a Hurry ..?  We have three of them stomping the world stage now.  Heaven help us all.

ND

Who represents Joe Public vs govt? Only one answer

On paper the Starmer government wants to be quite radical.  Sweep aside planning laws; aiming for impossible energy and housing targets, etc etc etc.  So there will be a load of Consultations coming down the pike - indeed, there are already.  And often very rushed, which isn't just a tactic, it's their mantra right now.

So: who responds for the ordinary punter?  In theory of course, absolutely anyone can respond.  But Joe Public ain't gonna find his hand-written views reflected in the Conclusion of the exercise.  And lobby groups don't always fare much better, although the smarter ones pick their fights and sometimes do OK.  

All the Regulators have some kind of very promising-looking "we are here to protect the public" statement on their "About" page, but again, that's in theory.  In practice, (a) it's often the Regulator itself that is doing the consultation; (b) they are all as political as Hell, and if they are responding to a Government department's consultation exercise, they are hand-in-glove (or indeed hand-in-puppet) and not to be expected to be independent or neutral in any way, shape or form[1]; (c) right now, the Starmer government has given all Regulators etc an extra formal mandate, which is to Promote Growth.  And they immediately fired the bloke at the CMA who didn't seem enthusiastic enough on this score, pour encourager les autres.[2]

Where, then, do we look for our defence?  There's only one answer: it is the venerable Citizens' Advice, which is a Statutory Consultee in many consultation exercises.  Not the organisation with the most prestige or biggest, best-paid professional HQ staffing, but in my experience (energy, of course) they do an heroic job.  Only they have consistently called out the nuclear power nonsenses.  It was they who absolutely, forensically skewered the outrageous Swansea Bay Tidal Lagoon scam. Etc.  

Can they keep their heads above water during Starmer's radical deluge?  It'll be a tall order - and if they start looking like the resistance, they stand to get bulldozed themsleves.  Good luck to them - they may need it, just as we all need them.

ND     

____________________

[1] This isn't just cynicism and supposition, it's a copper-bottomed fact, amply illustrated by FOI docs

[2] Maybe he was genuinely useless, I don't know.  He was certainly the one they made an example of 

Checks, balances, and the abuse of power

Current public pronouncements on the apparently untrammelled use of power - from absolutely any quarter with skin in the game (any game) - are to be taken with a high degree of circumspection.  Newspaper editorials?  Academics of repute?  Elected politicians?  NGOs?  Businesses?  To a greater or lesser extent they all live in fear of reprisals from a man, his entourage and his outriders who are drunk on power and their ability frighten everybody.  Yes, we are all afraid.  So, the signal degree of caution being displayed by all the above - who privately would all wish to articulate something much stronger - does not mean the western body politic is in some way calmly acquiescent.  The relative acquiescence is that of hostages in a bank raid whose only immediate instinct is to lie quietly on the floor with their heads down, and not move too much.

So what's to be said, on a humble US-hosted blogging site?  OK, at the very top there is very great power, formal and increasingly informal.  We all knew that.  Almost all politicians at the top of their own governmental tree, whatever constitutional form that takes, have such power.  Effectively unlimited cash or credit as regards short-term measures they might want to take.  An administrative regime, enough of which will take their orders.  A monopoly on effective violence domestically, should they choose to flex their muscles.  Typically, the power to declare an emergency and to suspend due process, acting by fiat.  (Just check out the EU 'constitution': almost every right and freedom a naïve EU citizen might imagine to be sacrosanct, is subject to being suspended or withdrawn on grounds of 'national security'.)

So we all know that a rogue government of any stripe and constitution can shoot its own people out of hand etc etc etc if it wants to.  To any but the most innocent, this is not news. 

So how come we mostly don't lose sleep over it: what's to stop rogue use of ultimate unilateral power happening?  Supposedly, a number of things.  (i) since modern times, elections - some kind of rough-and-ready filter on who gets to the top, their temperament and general suitability to wield such powers;  (ii) the commonsense of most humans capable of getting to the top - by whatever means - and wishing to stay there, that (ab)use of such powers, however tempting, is best deployed extremely sparingly, in the interests of the longer game; (iii) the fabled 'checks and balances' boasted by many constitutions: although if that means a material delay in any such counterbalance taking effect (as in the UK, to take one example, that if a PM takes emergency powers he must apply to Parliament for ratification after a while), then plenty can have happened in the meantime.  (And Johnson, of course, figured he could simply prorogue Parliament!)

We recognise (iii) - and its (short-term) limitations.  We think we've understood what went wrong with (i) - and history will not be kind to Biden and his imbecile entourage.  But (ii)?   Well, (i) having failed, (ii) is that bit more likely to fail, also.  But drunk-with-power seems the most likely.  Just look at their faces.  The passengers in any plane with a drunken pilot have reason to be scared witless.

ND  

How the Romans felt when Nero was emperor

Some pretty dire scenarios are easily envisaged, but it's anyone's guess now, on any geopolitical question you care to speculate on.  Has global politics ever hinged on pettiness and petulance to this degree?  Even remotely?  "well, checks and balances ..."   Really?

There is, at least, one thing we may be sure of:  Xi will be determined to make his move on Taiwan before November 2028. 

ND

Resignations ahoy!

Dodds a Dud

As Anneliese Dodds heads for the backbenches in high dudgeon, Starmer's thoughts must be ones of pleasure that he curtailed her short outing as Shadow Chancellor so decisively before the GE.

And thoughts here at C@W turn to the Qn 2 of the 2025 predictions Compo!  But it's strictly defined, as follows: 

Date of Starmer's first Cabinet reshuffle, as defined below. One bonus point for each correctly-named departure or clear-cut demotion. Two bonus points for any complete change precisely identified (named outgoer and named replacement). "Cabinet reshuffle" = two or more changes to the Cabinet roster, unforced by resignation or death. Splitting of an existing Cabinet post into two or more new positions doesn't count per se - only if accompanied by reshuffle as defined above.

So - anyone care to update their predictions?

ND

By popular request: zonal pricing for GB electricity

Under both Labour and the previous Tory regimes, serious consideration has been / is being given by DESNZ & Ofgem to the introduction of zonal (wholesale) pricing of greater or lesser granularity.  Maybe it'll be a handful of regions with separate mini-markets at the wholesale level, maybe it'll be a serious plethora of pricing nodes, with nothing that could be termed a 'market' at each.  

[To recap: right now there is a single wholesale pricing zone across the whole of GB (not NI) - essentially, the whole of the national grid HV transmission system is a single trading point.  This doesn't mean that all bilateral trade in the UK takes place at the same (half-hourly) price: but there is a single, transparent 'settlement' price for each half-hour, arising out of open-market commercial activity, that is an absolutely vital marker for any number of other commercial applications - settlement of forward deals (many of them representing essential hedging activity); basis of CfD subsidies; basis of 'index-related deals' for companies that want to be exposed to spot market prices (there are some); etc etc.  Open markets for commodities cannot exist without such things, even if the design of each market is strikingly different in detail.  The market we're sketching here looks not at all like, say, the spot market for Brent Crude: but they both have the same essential features.]

Why might there be pressure for change to a more fragmented set-up of regional-or-even-smaller mini (/micro) markets?

The argument is essentially theoretical, albeit based on experiences elsewhere.  Its most vocal advocate is Octopus, the UK's largest energy supplier (with tentacles in all manner of other sectors).  We might explain it by analogy with postage stamps.  Whether I send a letter to someone in the same town, or to Inverness, the stamp will cost the same.  Is that in any way reflective of the costs and dynamics of the post?  Patently, it is not.  Why shouldn't postal rates be properly cost-reflective?  It would surely make for efficiencies.  If you wanna live in Inverness, well, there you go.  It doesn't take much to make the cross-over analogies: if you are determined to build your windfarm in the North of Scotland, why should you get paid for getting your electricity into the GB-wide market at the same wholesale price as if you have a windfarm close to the 'centre of gravity' of GB electricity demand where your product is actually needed?  You sure as Hell cause a lot more problems for the Grid.  Hence the idea of moving, at least to regional wholesale pricing, if not pricing at an even more granular 'nodal' level. 

Oh, and for completeness, those advocating such changes say "it'll be cheaper for everyone in the long run".  That's a big leap of faith, though, because although there might (possibly) (in the long run) be an overall system gain from efficiency, the distribution of that gain is unlikely to iron out the positions of the winners and - more significantly - the losers, of which more below.

From first principles, other things being equal I am a big advocate of cost-reflective everything - you need accurate cost / price signals in order to know what's going on in economic life.  It's a matter of policy if you subsequently decide to subsidise those 'losers' deemed to be horribly disadvantaged by this, and unable to rectify matters themselves by reacting rationally to those signals.  That should be the exception, of course, because the aim is positively to incentivise rational responses!

But there are other considerations than efficiency, and I'll highlight two.  The first is political: the great cry of "postcode lottery" goes up - you can hear it already - there being, errr, winners and losers on a geographical basis, with corresponding heartfelt loser-lobbies, and locally-based politicians to heed them.  That includes residential energy users, but also electricity generators.

The second is Liquidity.  For markets to function, there must be liquidity: it's of paramount importance - a big topic, but for those who don't know why this is so, we'll hold a tutorial another day.  How big (in economic terms) does a region need to be before one can be certain of enough free-trading commercial activity to constitute a liquid market?  There's no precise science, and a lot of ignorance in play.  Yes, we can point to some apparently much smaller electricity markets than GB's, where there seems to be adequate liquidity.  But sometimes these turn out to be not genuinely separate markets, but rather 'branches' of the same 'tree'. 

All I would conclude with is this:  the current GB market[1], with the rather blunt, non-granular price signals it sends, may not be quite as efficient as would be ideal, but it is liquid (some say, 'indeed - but only just') and that's a precious thing, not to be taken for granted or tampered with lightly.  If blundering, incomprehending hands break this thing - and Miliband / DESNZ / Ofgem-as-currently-led[2] are just the poeple to do that - it'll be a disaster.  I'm not in the thick of the current market-design dynamics, but I sure hope they know what they are about.

ND
_________________

[1] I had a hand in the design of the original manifestation of the present market (2001), though there have been many modifications since.  You'll accuse me of pride and undue sentimental conservatism?  Fair enough!  But I know what the dangers are.

[2] There have been previous Ofgem regimes - and before that agency came into being, its predecessors 'Ofgas' and 'Offer' before it - that were truly excellent.  The present management is sub-standard.

While Trump & Putin deal bilaterally ...

It looks for all the world as though Trump, against all his self-vaunted reputation as a dealmaker, has rather publicly gone into bilaterals with Putin on a basis that may be designed to achieve something for "America First", but nothing whatever for Ukraine.  And maybe that's exactly the correct summary of the situation.

But even if he has, Putin has also made some capital errors in this process: he's wetting himself with such pleasure at being talked to again by someone other than China and NK, it's not clear he can help himself.

Just count his well-advertised desiderata:  I'm not sure which, if any, count as Red Lines, but just look at the list.

• Russia gets all of the oblasts of Crimea, Luhansk, Donetsk, Zaporizhzhia and Kherson (Kharkiv has sometimes featured on this list, and we know what he really wants is Odessa, for a free crack at Moldova and total blockade of Ukraine from the Black Sea)
• Ukraine to undergo regime change (we must assume he has a List of Names), and a programme of 'denazification' which is a long list of demands in itself
• Ukraine substantially to disarm
• NATO to withdraw from X, Y, Z (list varies), and deploy no forces whatever to Ukraine
• Ukraine never to be admitted to NATO (sometimes demand extends to EU) 
• end of all sanctions etc
• return of all assets (no doubt "+ interest" etc)
• end of all blacklistings, charges of war crimes etc etc
• return to the comity of nations in all dimensions, G8, sports, etc etc: (we may guess he has a list of specific showy performative demands to seal this)
• tickets to the Oscars, Wimbledon, Pope's funeral 
• I have probably forgotten a few

So: how many of these could Trump conceivably deliver?  (without at very least expending every last drop of personal credibility in the RoW, and US political capital with the EU.)

So Putin won't get all this (that's putting things mildly): so he risks looking like he's spent a helluva lot of blood and treasure for equivocal results.  May not go down well back in Moscow.

OR: he simply wants to set Trump at the throats of Europe.  Now that, he might achieve.  But not all of Trump's merry men are knaves or fools, by a long shot.  And not necessarily the bombastic, unequivocal, easily-understood 'victory' Putin would be hoping to celebrate in Red Square, even though it might be epoch-making in the long run.

This ain't over by Xmas. 

PS, I didn't miss the interesting BTL suggestion from Mr Cowshed that Trump wants to set Putin up against Xi.  Nice theory!  Even more difficult to imagine, though.

PPS:  Forgotten a few?  Didn't even mention return of the small Kursk salient held by Ukr since last August!

ND