BEWARE! THE BANKS ARE OUT TO GET YOU!

[Stanley]

That forecast has been filled out now, 'five quarters of recession'. I see Truss says she can avert the recession.
Is my memory playing tricks or do I remember correctly Sunak telling us repeatedly that we were doing better that all the other G7 countries, better than Europe etc. What happened?

[Tizer]

I see Truss says she can avert the recession.

Don't forget she can walk on water!

[Stanley]

Sunak and Truss can spend as much time on their fantasy budgets as they like to pull the wool over the 160,000 favoured few but the reality is that we will enter a full blown recession and still be in it well into next year. Some more pessimistic forecasters are talking about it being 2025 before we start to climb out of the hole. That could be over optimistic. We enter this minefield saddled with massive debt due to Covid and exacerbated by Brexit no matter what the Brexiteers say and with a distorted labour market where the skilled jobs are underpaid and the unskilled ones can't pay a living wage. Nobody will admit it but we are entering a period of 'stagflation', this is a situation where we have a stagnant economy coupled with roaring inflation. The BofE and the Treasury have no levers to pull. All they can do is keep increasing base interest to attempt to control inflation and this sucks spending power out of the general economy as all living expenses rise. The myth of the savings made during Covid lockdown will be exposed, we have higher levels of domestic debt than at any time in history.
Have I missed anything?
Oh, by the way, the very poorest families are already bearing the full brunt of this storm and it hasn't really got going yet. That happens in Late September, early October. We are in for a hard winter......

[plaques]

One of the measures that the banks have in assessing how people are managing in any economic situation is to look at disposable income. Of course this depends on what people are earning and will vary from person to person. Taking the mythical average to be £24000 a year.£1500 a month or £375 a week (after tax) They work on the 50-30-20 rule: ...
50% of your income on needs: essential living expenses, such as rent/mortgage, bills, food and transport to work
30% on wants: discretionary spending, such as eating out, shopping, trips and subscriptions
20% on savings or debt: paying off debt beyond minimum payments, or putting money into a savings account, investment or pension fund

So, if your monthly income was £1,500 after tax, you might spend:
£750 on needs
£450 on wants
£300 on savings or debts

Obviously as the cost of living spirals upwards the 'needs' spending increases, the wants diminish and although the savings may drop servicing debts may increase.

A 13.3% increase in inflation immediately adds £100 per month to the needs. Adding debt by working on 'minimum payment only prolongs the agony and extends the personal recession. Cutting back on future pension payments also has the effect of keeping a person on the bottom rung during their retirement.

For those interested in calculation their tax liability this site is useful. Tax calc:

[Stanley]

The measure that many poor people use to assess their economic situation is to open their purse and see if there is enough money for food, rent and other essentials and many are coming up with a very serious answer already, they have to cut something. That's too often mother's food, they give it to the kids..... This is the position we are in NOW and it's going to get worse. Sunak thinks that loans can help, problem there is they have to be paid back eventually! The basic problem is DISTRIBUTION OF WEALTH They all know this but nobody will tax wealth because that is the source of the gravy train they are all guzzling. Why do you think that hedge fund operators, property developers and the like are major political donors?
Piketty had it right but who has listened to him?

[Tizer]

Not a bank but big business `out to get you' - remember the lady who was threatened by High Street fashion giant Zara? Well she's won the legal battle!!
`House of Zana boutique owner wins trademark row with Zara' LINK

[Stanley]

Could it possibly be over-paid corporate lawyers searching for ways to justify the expense of hiring them?

[Stanley]

Have you noticed that when Tories talk about tax cuts they automatically assume they help everyone? How about those who don't pay tax?
(I assume that this is because they are poor and therefore don't matter .....)
Right on cue... I have just heard the news and Liz Truss still refuses to endorse what she refers to as 'handouts' (Indicative in itself of her attitude to the poor) and talking about tax cuts.
This on a morning when the energy companies report that customer debt is rising even now before the heating season starts.

[Stanley]

A new report says that the UK economy shrank 0.1% in the quarter April to June. Somebody from the government has just been on to say it isn't serious.... God knows what economic models they are using. Take it from an amateur with no qualifications that that is a load of cobblers!

[Stanley]

Breaking news and not on the web yet but there are reports that in the last 12 months food prices have increased 11% and there are no signs of this slowing down.
Remember my warning, food can and probably will be rationed by price. We are sleep walking into a disaster while Truss and Sunak argue about tax cuts.

[PanBiker]

E10 petrol is currently £172.9 per litre in Barlick. My holiday fill did the whole trip but I only had about 80 miles in the tank when I took Sally and Ruby to Skipton this morning for the train. I thought I would have a look at the pumps in the supermarkets so I nipped up to Morrisons. No displayed prices but I thought it would definitely match or be a bit less than in Barlick. Ended up at a pay at pump where you register your credit card in the pump first which gives you up to £100 credit, you then select the fuel you want which turns on the pump and displays the price per litre. £174.9!!! grrrr. I put a tenners worth in and got out of Dodge.

[Big Kev]

I've always found fuel to be more expensive in Skipton, nust be all those tourists. Asda or Sainsbury's in Colne seen to be the cheapest options if you're going that way.

[Stanley]

Pay rises are losing out to inflation already. Average pay is down 3%. Workers are being paid more but getting less. The gap is the largest that has ever been recorded.

[PanBiker]

I've always found fuel to be more expensive in Skipton, must be all those tourists. Asda or Sainsbury's in Colne seen to be the cheapest options if you're going that way.

Yes, I agree, I usually fill up at North Valley which is Sainsbury's, I noticed on my way past tonight that it is £169.9 - 3p cheaper than Barlick and 5p cheaper than Skipton but was running a bit late to a meeting. They are normally 3 -5 p cheaper than either of Barlicks filling stations. Get Nectar points as well at the Sainsbury pumps.

[Stanley]

I can remember when Wilson made his 'pound in your pocket' speech in 1967 I was laughed out of the Dog when I forecast that very soon there would be no change out of a pound note for 20 fags and a pint....With beer averaging £4 a pint and fags well over a tenner that statement looks very cheap now. Add about £9 for a gallon of fuel and I don't think anyone could believe it.
I thank god it doesn't affect me, I don't buy any of them. (Just a half of bitter if I am eating out with the daughters)

Later at 07:00. The latest inflation figure is 10.1%. It's going up faster than expected. BofE is expected to add another .5% to the base rate with consequences for mortgages......

[Tizer]

Relevant to this topic in terms of finance...
A student on a 3-year course would end up £72,000 in debt before they've even got a job. How long would it be before a bank would consider them for a mortgage or any other loan? They already have difficulties because of the £24,000 debt...
`Universities push for ‘vital’ tuition fee rise: UK students must pay closer to £24,000 a year or lose their places to foreigners, argue bosses' Sunday Times
`University bosses are calling for tuition fees to be raised closer to the £24,000 a year average that foreign students pay. They warn the £9,250 paid by UK students, which has been frozen for a decade, is forcing them to take on an ever-increasing number of foreign applicants from countries such as China and India. A record one in five young undergraduates starting at top universities this autumn are from overseas, according to official figures, up 7 per cent in a year. The number of British undergraduates has declined by 13 per cent....'

[Stanley]

And in 1979 when I went to Lancaster as a mature student I got a full tuition and accommodation grant and a discretionary grant from the Local Council for my three daughters. Today's students would think that was heaven. What has changed? surely more to it than inflation.
Later.... A random news item led me to THIS interesting site.
See THIS in particular.
"High Pay Centre and TUC research finds that median FTSE 100 CEO pay increased from £2.46m in 2020 to £3.41m in 2021". This figure needs to be more widely known..... It's all right for some....

[Stanley]

Don't open THIS link to a Guardian article on the latest inflation forecasts if you are of a weak disposition. Citi Bank is forecasting almost 19% inflation in the first quarter od 2023. Citi Bank estimates put the energy cap up to £6000.
Deep Joy!

[Tizer]

`Inflation: Who is benefiting from soaring prices?' LINK

[Stanley]

We have been told over and over again that funding cuts to the police do not affect efficiency and that 'bobbies on the beat' is an outdated concept. Listening to reports from Liverpool the point is made that community policing has broken down and this means less intelligence coming in from the streets and this encourages the growth of gangs and grooming children as young as nine years old by getting them to act as couriers carrying drugs, guns and other contraband.
Makes sense for me. Over to you Mr Raab.....

[Tizer]

According to the Telegraph, Royal Mail is facing an investigation as a Czech investor known as the Czech Sphinx prepares to take a 25% stake in the company.

[Stanley]

I heard the union boss make that allegation yesterday and when the head of the PO was interviewed afterwards he was asked the question "are you in talks with an outside investor". He refused to answer twice.... Draw your own conclusion. This is a public service, any such bid should be public and open to all. This is another example of where a refusal to give clear facts will be justified by saying the matter is 'commercially sensitive'. This defence should be banned!

[Tizer]

Agreed!

[Stanley]

It's simply a blatant mechanism to conceal uncomfortable truths from the taxpayers. Think of the number of times it was wheeled out when PPE contracts were being handed out to the lads!

[Tizer]

Dieter Helm is always worth our attention. Years ago when I was in publishing there began a mad rush to grow oilseed crops for automotive fuel and biomass crops to burn for energy. It made sense on land that was not fit for growing food crops but the moneymakers paid no heed to that and started replacing food crops. Unilever saw the danger to our food supply and commissioned a report from Dieter Helm and he provided me with an article on the topic for my journal. So when Helm speaks I listen!

`Former government adviser calls for overhaul of UK utilities regulators: Dieter Helm attacks privatisation model and says energy and water "too essential to be treated like any other commodity"' LINK
`Britain’s privatisation model for energy and water is “broken”, according to a former Conservative government adviser who has called for an overhaul of the sectors’ regulators. Sir Dieter Helm, professor of economic policy at the University of Oxford, said that energy and water were “too essential to be treated like any other commodity, as some of the architects of the privatisation, liberalisation and competition paradigm believed”. “It is not accidental that both the water and the energy privatisation models have run into serious trouble. After more than 30 years, neither is fit for purpose. Nor are their regulators,” he told the Financial Times in an interview.'....