From the archives #2
Posted on
December 11, 2017 by
Rev. Stuart Campbell
There was a time, readers, when Murdo Fraser was a bright young radical thinker who backed Full Fiscal Autonomy and even supported the idea of Universal Basic Income.
We think “committed Unionist” in this case is a euphemism.
Could somebody post a link to this weeks AS show, so I can get some real news.
Thanks to anyone who does.
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Scottish Government is totally limited in what they can do to raise money as they only have control of 20% of economic levers (poisoned chalice) and 15% control over piecemeal welfare powers. Up until 2016 it was 7% overall.
Richard Leonard’s ( stop the press revelations ) in Holyrood today . Phillp Hammond intends to sell off RBS . Laughter Curve will be aplenty for this afternoon’s session of Holyrood .
The baubles falling of the christmas tree outside 10 downing st Blatant advertizing Hendy Hoover used to clean them up lol.
OT. Scottish Parliament TV.
2pm today:
Ministerial Statement:
Scottish Government’s Draft Spending and Tax Plans for 2018-2019
link to scottishparliament.tv
@wull2
link to rt.com
Unpicking devolution isn’t quite as simple as some on the unionist side might delude themselves.
Their first problem is that rather obviously unless they remove powers from Holyrood any law they pass can be cancelled as simply as Holyrood passing an annulling motion. So the “not normally” part is a simple consequence of the futility of getting in to that kind of tennis match.
Their second problem is that where laws concern devolved matters they have to get the Queen to sign off on them. Which then gives the First minister an effective veto as she advises her on the use of the Royal Prerogative. Obviously that advice could be ignored but in either case you’ve entered Constitutional Crisis territory.
Trying to bypass Legislative Consent by unilaterally amending the Scotland Act is nowhere as easy as the press would like us to imagine.
Nor would/should amending Scots to add the, till now, absent concept of (Westminster) Parliamentary Supremacy and thus allow them to dictate to Scotland be allowed to stand.
On the subject of English cultural nationalist and ‘British’ exceptionalism (e.g. Brexit). Scotland’s emancipation threatens the self-conception of such individuals. Lots of English self-identities will take a knock when they ‘loose’ Scotland. A fair few cringing Scots will also be bit scunnered.
link to eprints.whiterose.ac.uk
@Dave
You really are a bit of an ignorant bigot. Crack on though son as your a laugh a minute.
OT. Scottish Parliament TV. LIVE.
2pm TODAY:
Ministerial Statement:
Scottish Government’s Draft Spending and Tax Plans for 2018-2019
link to scottishparliament.tv
R Scotland media review today engaging and informative. Ken MacDonald presenting and what a breath of fresh air he is. No wonder the BBC took him off air during 2014 in the run up to the referendum. Too intelligent an well informed to be given regular air time.
Does Labour have more people at Holyrood who have been leader than haven’t?
BREAKING from Pravda Quay
with Jackie Kim Ono
link to imgur.com
Dun n Dusted Scottish Budget being supported by Patrick Harvey
@ Cybernat, brilliant stuff but Jackie’s coupon portrayed must have been taken about 20 years ago!
Anent, the Scots skeletons in Durham, they should be brought back to Scotland for burial, the guys fought for Scotland & should be returned forthwith!
Why do you think Farage (as in garage) has been given so much media coverage? The New Right shall not be defied, there is no alternative!
Emotion and Cognition
link to youtube.com
Social Psychology: Cognitive Misers, Schemas, and Social Cognition
link to youtube.com
The Psychology of Influence: Mere Exposure Effect
link to youtube.com
Sky News telling lies about the SNP budget,
link to twitter.com
You could not make it up, well obviously you can if you are Sky or any other unionist media news outlet.
We’ve been saying (MMT’rs) this for a long long time now and just before the first FED rate hike we said the following.
That inflation would increase, the dollar would fall, gold and commodities would rise and Treasuries would be lower.
The FED have had 4 rate hikes so far since December 2015 and yesterday was the fifth.
Let’s have a look.
December 2015, Dollar Index, 98.
Today, Dollar Index, 94.
December 2015, Dollar/yen, 121.00
Today, dollar/yen, 113.00
December 2015, Gold, $1050
Today, Gold, $1240
December 2015, Oil, $38
Today, Oil, $57
December 2015, 10-Yr Treas futures, 127.00
Today, 10-year Treas futures, 124.00
December 2015, CPI, 0.7% y-o-y.
Today, CPI, 2.1% y-o-y.
Don’t forget about the £ and the Euro against the $.
Euro has gone from 1.08 to 1.19
£ has gone from 1.2 to 1.36
Since the FED started hiking and the $ weakened.
None of this is supposed to happen right ? No matter what TV channel you watch or newspaper you read they go to extreme lengths to point out the opposit is true.
MMT got everything right again. It’s all right there. The gold standard mainstream still can’t see it never mind why it has all happened.
They’ll still tell you in every 15 mins soundbites that interest rate hikes fight inflation and make a currency stronger.
We say interest rate hikes are simply price hikes right across the economy as the price hike get spassed on. We also say the mainstream completely ignore the interest income channels. We say interest rate hikes increase deposits.
All else equal.
They are price adjustments, pure and simple. Higher rates equate to higher prices and higher prices mean higher inflation. Inflation is not good for currency. Higher inflation is good for inflation-sensitive stuff like gold and commodities as well as some stocks.
Currencies are a bit like bonds, the only difference being they have zero maturity. Everyone seems to understand that when rates go up bond prices go down. It’s an inverse relationship. The discount to par reflects the implied yield and that discount increases as rates go up.
Same with currencies. The spot price of a currency can be considered par. In a rising-rate environment the forward prices of a currency are lower. The market is literally pricing in a lower exchange rate. The degree of discount to par reflects the implied yield. Buy a forward and hold it over time until it converges to spot and you will earn the implied yield.
Gold and commodities exhibit the opposite behavior. They don’t earn. They cost you to hold. There are interest payments and storage costs so the natural “curve” of gold and commodity markets has a positive slope. (Deferred contracts are priced higher than spot.)
In a rising-rate environment, forward contracts for gold are priced higher. That reflects the “cost” of holding, which equals the interest rate plus storage, etc. Prices rise in a rising-rate environment and they fall in a falling rate environment.
Of course this does not reflect short-term portfolio shifts based on traders’ beliefs. Many believe that lower rates are bullish for gold or bearish for a currency and vice-versa. As a result, they act on those beliefs and buy and sell accordingly. However, that’s not the true fundamental effect. That’s why so many people lost money buying gold when they believed rate cuts would be inflationary. Similarly, they wrongly sold the dollar. These mistakes are being repeated now, only in reverse.
The Fed thinks it is fighting inflation when actually it is feeding it via these rate hikes. Any commodity curve will show this in reaction to a rising-rate environment. The curve will instantly reflect higher future costs.
In addition, their policy and statements seem to reflect a lack of understanding of the government being a net payer of interest. They talk about being on guard against further fiscal stimulus when it is the Fed itself that is doing the stimulating. It is paying. That is income added, not removed. While some may find it harder to borrow because of the higher cost of credit, that is offset by the additional income earned by creditors and savers. There is net income received by the economy and that is by no means a brake on economic activity.
If you were a cynic You could possibly go further and say that central banks with their current policies show that the ONLY manifestation of inflation that they are interested in will actively try to stamp out is a rise in your wages.
They tell everyone they are increasing interest rates to fight inflation but the reality of the situation is they are increasing inflation albeit slowly as the data suggests but destroy your income at the same time. Because your income can’t keep up with the growth in inflation they are causing.
So are they stupid and they dont know what they are doing ?
Or
Do they know what they are doing all along ?
It’s as if Mankwi was tasked by the corporate sector to write an economic textbook that is taught to economic students the world over that says black is white and white is black but ultimately no matter what colour it is everything will serve the corporate sector whilst we send the herd the other way. He got paid a lot of money for doing so.