Hence I still expect Labour to win the next election. Unfortunately.

“I suggest you watch an index that will tell you when the world economies are starting to perk up and when trade conditions are really starting to ease. It’s called the Baltic Dry Index.Essentially the Baltic Dry tracks the average daily price for shipping dry bulk like coal, iron ore, wheat and soybeans. There are three things that make it such a good leading indicator. One, the index looks at raw materials, so it captures activity at the very beginning of the production process. Two, it looks at ocean shipping, so it reveals what’s happening to international trade — the critical driver of global growth. And, three, the shipping business depends heavily on credit, so the Baltic Dry indicates whether credit is tight or loose.”

Link:

http://www.economicpolicyjournal.com/

Go to the post headed “The Baltic Dry Index at Five Month High”.

This points to fool hardiness of QE: it assumes that monetary authorities have the knowledge they need to be able to pinpoint the crucical points at which they should pull this £75bn back. They don’t and yet the incumbent authorities can always argue the toss to justify their decision. And when they are wrong they just stand around in a circle blaming each other (change leader if necesssary).

Say “bye-bye” deflation (if it was ever really a threat) and “Hello” double digit stag-flation and maybe even Mugabe style Hyperinflation. If you have savings in sterling switch it quick for commodites or metals (gold/silver) cos the pound will buy you bugger all in the next couple of years. Even if the IMF sells off its gold reserves and the gold price falls that will be temporary as more and more investors switch to gold as a safe haven against inflation (not just here – rest of Europe and the USA).

At least Gordon/Mandy are in power to help us all get thru this. It wouldn’t even have happened if they had been in power for the last 12 years would it …..

I have only two further points to make on this:

(1) LGO’s should obviously be awarded a further amount so they can have interest paid to them on their pay ward for the backdated element. That would only be fair.

(2) This is good news for the economy and its self evidently the right thing to do. It will increase aggregate demand in the economy and so boost production and help get us thru this recession providing real help to real people who have been let down by selfish bastard bankers who, in the court of public opinion, should burned on a pit and their wimmin folk and daughters raped, pillaged and whipped. If this Pay Award doesn’t do his then of-course thats because the pay award wasn’t big enough, wasn’t done in time and … errr …. welll …. its Thatcher’s fault because … errr … something else.

Did anyone hear Brown on You and Yours the other day taking questions from the audience (Iain Dale has the link)? His denial of the role of interest rate policy as conducted by the BoE over the last 12 years in causing this crisis is quite staggering. I really do tire of this govt.

http://www.investmenttools.com/futures/bdi_baltic_dry_index.htm

(I’m assuming that you know what this is.) After its spectacular collapse last year, heralding the severity of the downturn, it has since recovered sharply, to roughly the level extant in late 2005/early 2006. So was global trade dead in the water back then – I think not! It is still on a steeply upward trend. Why is nobody writing that world trade is apparently showing the fabled ‘green shoots’ of recovery?

The tragic farce of QE which is being forced through by the Treasury and BoE is far too much if a recovery in global trade is indeed already occurring. Triple digit inflation in this country is the most likely outcome. Poor Messrs. Cameron and Osborne, because they are the ones who will have to snub it out, and that will be much more painful than anything seen to date in this crisis.