The IMF forecast

There are some parts of the IMF forecast that I think may well prove to be right. They anticipate global growth at around 3.1% this year and 3.4% next year. They think India and China will continue to grow much faster than the advanced countries. They think that over the medium term the UK will grow 0.5% per annum faster than the Euro area. The UK has been growing faster since 2010 than the Euro area, and on current policies I agree that is likely to continue. They also think the UK will be the fastest growing of the major economies this year – quite a contrast to others.

Where I disagree is with their 2016 and 2017 forecasts for the UK. They seem to have been too influenced by the early adverse July manufacturing PMI survey which they cite , where leading executives of large companies expressed their frustration at losing the referendum. They have a 2016 forecast of 1.8%. Given the robust retail sales, service sector output, car sales and new homes sales figures we have seen since June 24th it is difficult to see why it is below the Treasury March forecast of 2%. However, their forecast is somewhere near that Treasury forecast, and is way more optimistic than all those forecasting an early recession following the vote. My disagreement with it is minor. It’s all a big change of tune from the many gloom mongers this summer saying the UK economy would tank immediately after the vote.

They have instead marked down 2017 more, to just 1.1%. They draw attention to how “the aftermath of the Brexit vote weighs on firms investment and hiring decisions and consumers purchases of durable goods and housing”. So far employment has gone up, new home buying has increased, and car sales and output hit high levels in August with robust growth. If in the immediate shadow of the vote confidence remains high, why should it crumble next year when the anger and upset of those who wanted to remain will have calmed a bit more? They do not mention the large monetary stimulus that has been administered by a lower pound, a cut in interest rates, and a large money creation programme from the Bank of England.

At least they are not forecasting recession any more for the UK. Could the UK economy get hurt? Yes, if a crisis somewhere else in the world blew up. I suspect the IMF is right in thinking we can avoid a major banking crash anywhere for the time being, that China will continue to grow, and worldwide authorities will want to assist expansion. On this basis there should not be a recession in the UK this year or next.

Meanwhile the news media highlights a small fall in the pound this week, but ignores the fact that the FTSE 250 and the smaller companies indices have recently hit new highs. We are told that the FTSE 100 has gone up thanks to overseas earnings. Why have they lost interest in the FTSE 250 which they told us after the vote was the one that mattered? Is it because it too has embarrassed them by going up and hitting a new high? That’s not owing to overseas earnings! Yesterday was strong dollar day. The dollar rose against sterling, the yen and the Euro. Sterling rose against the yen, but our media suppressed that fact as it blows their Brexit thesis about the fall in the pound out of the water.

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61 Comments

  1. DaveM
    Posted October 5, 2016 at 5:45 am | Permalink

    Regarding your final paragraph –

    the media can only hide the potential crisis in the Euro for so long. Barely a mention on the BBC of the German banking story.

    I have been exchanging currency regularly for the last few weeks and can’t help noticing the change in the Euro exchange rate, which has been fairly stagnant. Don’t they keep telling us that a weaker pound is good for exports and that a steady state vs the Euro is a good thing?

    I currently pay for everything abroad in Euros. Ironic that it was the Remain campaigner Gordon Brown who ensured that we had plenty of Euros for such a situation as this!

  2. Brexit Facts4EU.org
    Posted October 5, 2016 at 5:54 am | Permalink

    Another measured and informative piece, thank you. Looking back over the last 10 years, it’s hard to see how anyone could now consider the IMF to be fit for purpose. Certainly in recent years the organisation appears to have been politicised beyond any reasonable measure.

    On the same topic, prior to the Referendum the Governor of the Bank of England referred to Brexit as being the biggest domestic risk to the economy of the UK. It’s our opinion that it’s now the negativism and pessimism of Remainers which is rapidly becoming a serious risk. No wonder that international markets are reacting the way they are.

    O/T: Your readers might be interested to know about the legal opinion just published, indicating that the UK has every right to negotiate and conclude trade deals, ready for implementation the day we exit the EU officially. This contradicts the position of the EU Commission, which seems ready to take action against the UK. We’ve produced a summary here:
    http://facts4eu.org/news.shtml#pre-Brexit-trade-deals

  3. Lifelogic
    Posted October 5, 2016 at 6:05 am | Permalink

    Indeed.

    Meanwhile it seems Mrs May is going to deliver a sense of the direction that the BBC seems to think is close to a Michael Heseltine one. The complete opposite of what is needed.

    Worker on boards, gender pay reporting, yet more government and red tape all over the place will hardly help Hammond’s call for better productivity. Muttering on about “fairness” and other absurd nonsense. How on earth can the government make the world fair? They cannot with the NHS even treat cancer patients competently or perform simple eye operations without years of delay.

    Every politician should perhaps have something on their wall saying:-

    “The World is not fair and never will be, just get over it. It is not you role to take money of some people and waste it trying to make it fair, it does far more harm than good.

    It seems she will say she is “determined to employ the power of government for the good of the people” and claim the new centre ground.

    If she really wants to do this she should half the UK bloated, misdirected and incompetent state sector in size. have a bonfire or red tape and cut tax rates.

    The power of government after all only comes by taking money of the people in the first place, (mainly the people who know how to make and invest it too). Then the state spends it mainly on daft and damaging things like green crap, HS2, Hinkley, pointless degrees, counterproductive wars, augmenting the feckless, motorist mugging cameras and similar nonsense.

    • Lifelogic
      Posted October 5, 2016 at 6:22 am | Permalink

      Mrs May seem never to have run a business of any sort in her sixty years and has a degree in geography. Why on earth does she think she can usefully tell business owners how to run the businesses that they have often been running very well indeed for years?

      Businesses that she has never seen and knows virtually nothing about.

      Philip Hammond yesterday said he wants to see higher productivity yet Theresa May, today, seems to want government to put another spanner in the works.

      Perhaps they should get their act together.

      • Lifelogic
        Posted October 5, 2016 at 6:25 am | Permalink

        What is May government going to do about Osborne’s moronic national wage controls that will clearly kill thousands to jobs and damage productivity by putting them onto benefits?

  4. Roy Grainger
    Posted October 5, 2016 at 6:06 am | Permalink

    Brexit is just a small event in world economy terms – the IMF should have bigger issues to consider in their forecasts such as the upcoming USA elections. If Trump is elected then the liberal elite have a much bigger bogeyman to blame for any adverse economic news. In general all these economic forecasters have attained the same status as the Met Office, their political bias has undermined their credibility and they will struggle to get it back.

  5. Lifelogic
    Posted October 5, 2016 at 6:08 am | Permalink

    Then we have Amber Rudd threatening Landlords with prison just for renting their property to people. I assume she would prefer all the illegal immigrants just to live on the streets, after all no one is deporting them very often.

    • agricola
      Posted October 5, 2016 at 8:49 am | Permalink

      Amber Rudd seems to be bidding for Rottweiler or bad cop in the government. She advocates the naming and shaming of UK companies who employ none UK workers which I believe is counter productive. Companies should be free to employ the best irrespective of nationality. If there are not enough UK nationals in this category then look at the education system that is failing to produce them. Nurses and doctors in the NHS are a glaring example. Nurses who provide comfort to the elderly and ill do not all need to have degrees, they need vocation.

      However if Ms Rudd wishes to target those businesses who employ illegals because they are cheap or companies that pay below the legal limit I am on side. She could also stamp on agencies who receive the minimum wage but pay less to those they control.

      Her statement has all the qualities of a witch hunt. In terms of manual worker vacancies ,particularly in agriculture and presently filled by willing immigrants from the EU, she could consider ways of motivating the lazy and idle, living on benefits to work in the fields. WW2 saw thousands of young women do this work with great success. The feckless should not have a free ride at taxpayers expense.

    • Lifelogic
      Posted October 5, 2016 at 12:21 pm | Permalink

      Mrs May certainly seems to be keeping the option of an early election very open indeed with her lefty, interventionist speech.

      She went on about Edmund Burke and how Conservative believe in free markets then went on to list endless ways she wanted to distort and damage it:- Housing, wage controls, workers and customers on boards, gender pay reporting, energy markets, schools, broadband, the NHS ………

      What is very clear is she that either:-

      She does not believe in free markets herself and is essentially a dire interventionist Libdim.
      Or perhaps she is just not telling the truth and but thinks it might win her a snap election by sounding as dire a lefty as Cameron.

      She even praised Cameron for winning a majority. The first one he through by ratting on Cast Iron. The second was handed to him by the dire prospect of an Ed Miliband/SNP coalition.

      Cameron would actually have won a far bigger majority had he been a proper small government, low tax, EUsceptic Tory and not a dire Libdim.

      Echoes of Michael Heseltine say the BBC, how depressing that would be.

      • mickc
        Posted October 5, 2016 at 6:38 pm | Permalink

        But of course, May has echoes of Heseltine! She does not believe in the freedom of the individual, and is very much an interventionist.

        We will see if that plays to her benefit….after all Heseltine had quite a following.

    • Bob
      Posted October 5, 2016 at 4:01 pm | Permalink

      @lifelogic

      This blog article by David Lloyd on welovenottingham blog sums it up rather well:
      ” Hammer the Landlord
      Amber Rudd’s got the answer to our immigration challenges.

      The Home Secretary proposes to make it a criminal offence for a landlord to house a tenant who cannot prove they can sing the National Anthem and recite the names of the last ten Prime Ministers. Actually, from February this year, and even earlier in Birmingham, it’s already been an offence they can fine you £3000 for, although that seems to have been forgotten in the press coverage.

      The majority of landlords are not horrible bullies who abuse tenants. 78% of them have only one property. They’re often accidental landlords, inheriting a house or failing to sell one, or moving round the country owing to work. Or they have put their savings in a property because, rightly, they have no faith in banks or pensions. They probably try to keep the property decent and the tenants happy so they can have decent stretches of tenancy without the risk of emptiness.

      Suddenly, we accidental landlords are the devil, more so with every announcement. We’re now no longer to be allowed tax benefit from the mortgage repayments. No, we are taxed on profit we have not made. We take on all the risk of a property, with little benefit. Indeed, sometimes no benefit, when you get a tenant who destroys your property and won’t get out.

      But we are the devil.

      What’s this latest proposal? That we lay-landlords perform due checks to make sure we are not housing an illegal immigrant. If we fail, we can go to prison. So, we are landed with doing the job that her Majesty’s Border Force fails to do. Will those uniformed folk go to prison too if they let someone through they shouldn’t?

      What next? Let’s make Sainsbury’s do immigration checks before they deliver your kippers, kiwis and Kit Kats. After all, if illegals can’t eat, that’s got to be good news, surely.

      This vicarious legislation is ill-judged, headline-grabbing and reactionary. Another attack on people trying to run their lives efficiently so that they can afford to stay in a nursing home which serves proper tea when they’re old.”

      • Ian Saunderson
        Posted October 5, 2016 at 5:36 pm | Permalink

        Excellent points well made.

      • Lifelogic
        Posted October 5, 2016 at 7:36 pm | Permalink

        Exactly.

  6. Lifelogic
    Posted October 5, 2016 at 6:51 am | Permalink

    Businesses forced to reveal how many foreign staff they employ under Government plans to force companies to take on more British workers, the Home Secretary has said.

    So we have all these anti-discrimination laws but now she wants businesses to actively discriminate against non British applicants. What on earth is she thinking. Yet another pointless & damaging burden forced on to business to damage its productivity. Is Amber Rudd really this bonkers? Perhaps she is, she certainly fell for all the exaggerated climate alarmism drivel in her last position.

    • stred
      Posted October 5, 2016 at 12:46 pm | Permalink

      In between much waffle about the wonderful new future post the very slow Brexit, Mrs May has also threatened that they will be intervening to ‘come after’ accountants guilty of advising clients how to minimise tax legally, using her own laws. And she confirmed that, having just ordered the most expensive and problem ridden nuke to put on the bills plus inflation, we are going to go ahead with our proud national project, HS2, which is for ‘connectivity’. Perhaps they are going to add connections to HS1, Heathrow, Birmingham centre, Manchester Centre, and HS3.

      She will of course not reconsider the very expensive offshore windfarms that give such problems to the grid, or announce more support for gas stations to take up the slack, while other nukes close. But she has support of Remoaners like Mr Carmichael, who is referred to (in attached link ed)

      It is good to have sovereignty back, but a shame we don’t seem to have people to govern us any better than those in the Commission.

      http://www.thejournal.co.uk/news/north-east-news/tory-accused-hypocrisy-over-wind-4457703

    • Anonymous
      Posted October 5, 2016 at 2:58 pm | Permalink

      Displacement of indegenes is the core reason for the Brexit vote. So yes. It is important that a job must go to a Brit (regardless of colour) if they can do it – otherwise people will see no point in leaving the EU. The employer is not bearing the brunt of the true economic cost of open door policy.

      So too control of landlords who have, for too long, been propped up by welfarism and house inflation by overcrowding.

  7. Lifelogic
    Posted October 5, 2016 at 6:53 am | Permalink

    Are they just talking this lefty nonsense to plan for an early election? Or do they actually believe in this damaging nonsense?

  8. alan jutson
    Posted October 5, 2016 at 6:54 am | Permalink

    Perhaps the IMF has changed its mind about the UK because they no longer have Cameron and Osbourne at their throats, pleading with them to mirror the Remain campaigns fears.

    Just a thought !.

  9. oldtimer
    Posted October 5, 2016 at 6:57 am | Permalink

    These forecasts, in so far as they relate to the UK, require more guesswork than usual.. For the UK much will depend on the outcome of the Brexit negotiation – and on how long it takes and on how tortuous and acrimonious the process may be. No one yet knows the answers to these questions. If trade and business carries on much as before the outcome will be relatively benign. If there is a reversion to WTO tariffs then there will be a process of readjustment in some business sectors to take this into accoun. This would especially apply to car makers like Nissan, Toyota, Honda and BMW (and their suppliers) who sell lots of cars to the EU. JLR would be affected too but to a lesser extent as they already have in place a manufacturing strategy to build vehicles inside the EU – in Slovakia where the plant is due to open in about two years time. The real impact of Brexit will be known in two to five years time after the negotiations are complete, new global trading arrangement are (or are not) in place and UK business has adjusted (or has failed to adjust) to the new realities.

  10. rk
    Posted October 5, 2016 at 7:04 am | Permalink

    I’m hearing that in $ terms the FTSE 250 is lower.
    I don’t know whether that matters?

    • Lifelogic
      Posted October 5, 2016 at 11:05 am | Permalink

      Indeed the rise in the UK markets is largely just a fall in the value of the £. The unit it is measured in has less value to international companies are worth more in £’s.

      Reply How do you explain the good performance of the FTSE 250

      • Richard1
        Posted October 5, 2016 at 3:04 pm | Permalink

        Many FTSE 250 companies also have non-£ earnings and as pointed out above, to international investors, £1,000 is 10%+ cheaper than it used to be!

      • Lifelogic
        Posted October 5, 2016 at 7:39 pm | Permalink

        To reply:- The devaluation means they become more competitive against the imported competition and can also export more competitively.

  11. am
    Posted October 5, 2016 at 7:04 am | Permalink

    IMF and other organisations are busily revising up their forecasts for this year and next. They forecast previously on models but now they are including data. Hence the revisions upwards. Further they will have to revise upwards again as more data comes out.
    A voice of sanity in the gdp terror show has been the ONS who have continually said there has been no major impact on the British economy by the vote leave. But they have been shouting into the wind. This Friday the August trade numbers are published by the ONS. If there is a further downturn in the deficit then people might realise it is quite possible for the rate of growth in Q3 2016 to be greater than the 0.7 rate of growth in Q2 2016. It would certainly lead to further upward revisons for 2016 by the IMF, etc., and it will be nice to get used to this trend of upward revisions.

    • stred
      Posted October 5, 2016 at 1:06 pm | Permalink

      Perhaps the ONS realise that nothing has changed yet and we will not be altering tariffs, passports for banks, inspections of goods or anything else for 3 years while Mrs May is being very careful and thorough. When and if we ever do manage to control migration and count people in and out, using real figures instead of sample interviews asking silly questions, the GDP growth will reduce, because the present figures depend on inward migration. It won’t reduce to 10s of 1000s because we will not be able to find British employees willing of able to do the work and we will issue work permits. We are now more interested in Grammar schools than training bricklayers. If we knew that students from abroad went home and did not overstay, then their numbers could be omitted, as happens elsewhere.

      It is not possible to forecast until the real changes are known. Mrs Lagard’s forecasting is a waste of money.

      • am
        Posted October 5, 2016 at 2:42 pm | Permalink

        I was referring to the short run forecasts as does the post. You do know the Treasury produced two forecasts: one for the short run on a leave vote and the other for the long run after leave. Remainers wish to avoid, at the moment, the short run Treasury forecasts.

    • Denis Cooper
      Posted October 5, 2016 at 1:23 pm | Permalink

      Even if UK GDP grew by just 0.7% in Q3 2016 that would still be a greater increase than the one-off “boost” promised if we stayed in the EU and TTIP came into effect, and it would be more than half of the 1% increase in per capita GDP we have obtained through the creation of the EU Single Market according to this:

      https://www.bertelsmann-stiftung.de/fileadmin/files/BSt/Publikationen/GrauePublikationen/Policy-Brief-Binnenmarkt-en_NW_02_2014.pdf

      “20 years of the European single market: growth effects of EU integration”.

  12. Ged Bradbury
    Posted October 5, 2016 at 7:26 am | Permalink

    Thank you for your insight John.

    Radio 4 news yesterday constantly referred to the pound and never mentioned any f the FTSEs

    • Chris
      Posted October 5, 2016 at 8:35 am | Permalink

      Sky news at 10 last night was, I thought, incredibly negative, with little or no mention of the positives, and of course, Anna Soubry was available to comment.

      • Anonymous
        Posted October 5, 2016 at 4:34 pm | Permalink

        Perhaps someone senior might intervene on the broadcast media. They are definitely setting agendas rather than reporting news. The Sky video on Hard or Soft Brexit is blatant propaganda and political manipulation.

        The BBC is no better.

        They simply refuse to accept the referendum result, and nor do one or two who comment here.

      • Lifelogic
        Posted October 5, 2016 at 7:45 pm | Permalink

        Indeed the BBC can hardly to anything with Soubry, Parris, Toynbee, Finkelstein, Yasmin Alibhai-Brown & Diane Abbott types.

        They should be attacking May for being dopey, lefty socialist not from the left as they always do.

    • Mike Wilson
      Posted October 5, 2016 at 9:27 am | Permalink

      On the BBC radio news yesterday, it was reported that someone called Kanye West who, I believe, is some sort of popular music artiste, has cancelled two shows in America as a result of his wife, one Kim Kardashian (something like that – someone famous for being famous) being robbed in France. The cancellation of these shows, in America, is, apparently, of interest to those of us listening to the BBC news drivel.

  13. forthurst
    Posted October 5, 2016 at 7:31 am | Permalink

    Why do we subscribe to the IMF when we don’t have any money and when the money we borrow to lend on goes to Ukraine in the interests of proping up a neocon puppet regime hostile to European unity and in conflict with the IMF’s own rules on prospective repayment. Christine Lagarde’s main concern is presiding over the EU’s welbeing when the EU already has five presidents . The EU is a thoroughly corrupt and highly politicised organisation and we should not belong to it.

    • forthurst
      Posted October 5, 2016 at 7:38 am | Permalink

      The IMF is a …

    • MikeP
      Posted October 5, 2016 at 3:45 pm | Permalink

      “Christine Lagarde’s main concern is presiding over the EU’s well-being”
      And that in a nutshell is why all the doom-mongers came out before June 23rd. It was for no concern for the UK’s well-being but just their failing pet EU project that must be propped up and revered at all costs. Even her comment about prospects being “from bad to very bad” was clearly all about impacts on the EU not the UK. Of course they see us a selfish and only interested in number one rather than our own view of a return to our rightful worldly position. We should just press on regardless.

  14. hefner
    Posted October 5, 2016 at 7:42 am | Permalink

    The problem could be that not all UK people have shares in the FTSE100, 250 or any other FTSE, directly or in a company pension or a SIPP. Do not forget that a non-negligible fraction of people in this country only relies on a state pension. The public on this blog is hardly representative of all situations. Not everybody is worried by the amount of tax to be paid when selling a BTL property or when dealing with IHT.

  15. fedupsoutherner
    Posted October 5, 2016 at 7:42 am | Permalink

    Good news is not generally broadcast by the BBC!! They only highlight the depressing stuff. They are not used to admitting they are wrong.

  16. Iain Moore
    Posted October 5, 2016 at 7:52 am | Permalink

    I too had noticed the media’s sudden loss of interest in the FTSE 250. having FTSE 250 also rising doesn’t fit their negative anti Brexit narrative.

  17. Antisthenes
    Posted October 5, 2016 at 8:10 am | Permalink

    Too much thinking is convention based and politically biased. It drives the likes of the IMF, central banks and governments. This inevitably means that the state or state sponsored bureaucratic bodies rely on expert opinion to decide policies and practices ignoring consumers whose opinions are far more reliable. Consumers are no better at decision making than experts and politicians except in one place the market place. The experts of course look to markets for information to guide them in their decision making. How that information is interpreted and processed using whose theories decides what policies and practices are pursued. Obviously a very unsatisfactory situation where error of judgement is exceedingly possible.

    That error of judgement is very noticeable when it comes to forecasting as very often they are proven to be incorrect. Expert planned economies are not always so obviously bad except those planned using far left wing economic theories as they tend to collapse totally quickly. Others tend to have more roller coaster tendencies needing constant maintenance and collapse very slowly.

  18. Bert Young
    Posted October 5, 2016 at 8:12 am | Permalink

    Forecasts are exactly how they are described ; they are not called “truths” . The people who produce them rely on stored data assuming that circumstances will be the same ; historians – who look to the past as an indication on the probability of the present , are in the same boat , certainty is only that which emerges day by day .

    Like most people of my generation who have made investments , I have never believed that it is the short term that matters ; 5 years plus is the most reliable outlook . In 5 years we will be out of the EU , we will have experience of trading freely and we will have benefited from making our own laws and pruning our economy to suit our needs . I consider that the needle of success will favourably point in our direction .

  19. zorro
    Posted October 5, 2016 at 8:32 am | Permalink

    All propaganda – falling pound, turbulent rollercoaster times, Assad barrel bombing citizens lovingly protected by Al Nusra/AQ in Aleppo. Thank God that the Western allues have never killed civilians by mistake during conflict….. Seriously, does anyone really believe what the BBC pumps out. Even during WW2, the British public had a different take on what the initials BBC stood for…..

    zorro

  20. Pete Stroud
    Posted October 5, 2016 at 8:37 am | Permalink

    The last sentence of your article, JR is interesting. When will the media, especially the BBC realise that spinning against the facts just makes them look extremely shifty?

  21. acorn
    Posted October 5, 2016 at 9:04 am | Permalink

    I am starting to warm to Mrs May. If she can walk the talk, it could get quite refreshing around the UK.

    The UK economy is doing better than most because it is still running a higher government budget deficit compared to other non-basket case countries and the Euro area. That is fiscal stimulus increasing household spending power.

    QE, monetary stimulus, has distorted asset / FTSE indexes to high levels, plus the near zero Bank Rate affect on price – earnings ratios. There is little evidence that QE has increased household, non-debt, spending power.

    This media obsession with FTSE and similar, is a bit silly, they are just casino metrics as far as the real economy is concerned. Unless you are using overpriced assets as collateral for loans.

    Please could I recommend to the May- Hammond combo, a read of “Smart People talk about Government Buying – Modern Money Matters …” (Google “…”). It was good to see more support for MMT yesterday from Jack.

    With luck, we have got a PM and Chancellor who are not obsessed with neo-liberalism and genuflect before global corporatists, bent on taking over sovereign nations.

  22. Iain Gill
    Posted October 5, 2016 at 9:33 am | Permalink

    Got to say the immigration coverage on the BBC has been laughable. Although some of our major politicians have got it badly wrong too.

    When I work abroad I don’t expect to pick up local citizenship simply for working there. When I work abroad I don’t undercut the local workers.
    When I work abroad I pay for my own healthcare and the education of my children unless I am in a country with specific reciprocal arrangements with the UK when often I end up paying anyways.
    When I travel abroad I don’t rock up and claim benefits or social housing.
    When I travel abroad I am expecting to return to the UK at some point.
    When I work abroad I don’t not put incentives in place against educating, hiring, or training local staff.
    When I work abroad I pay at least as much tax as local workers do.

    I think the immigration debate has lost track of a lot of these realities.

    With the exception of genuine refugees who should generally be helped in the first safe country they come to, and should be helped to return home if peace breaks out, and people who genuinely marry Brits we should be having a much longer harder look at immigration than the BBC bubble would let us think.

    The way some big business is making money on the backs of displacing Brits from the workforce, undercutting British pay levels, and systematically importing cheaper labour from other countries needs some cold hard thought. The spin the CBI put on what big business does is rather quaint, and having been inside some big companies engaged in these practises I know the CBI spokesmen are either naïve or being economical with the truth.

    The worst racism I have ever seen has been inside some of the big outsourcing organisations engaged in importing large foreign workforces to displace Brits, internally and behind closed doors they are racist anti British and we are being taken for mugs. Why don’t the liberal elite recognise this and call it out for what it is?

    Its time people like me were listened to.

  23. Richard Butler
    Posted October 5, 2016 at 10:09 am | Permalink

    Remainers across the web assure me ‘thicko Brexiteers’ have wrought huge damage that will surely reveal itself shortly and at last the enlightened, compassionate apostle class will regain it’s rightful place as dispensers of wisdom and correct thinking.

    Many of them reveal profound ignorance by asserting such things as ‘when Europe stops trading with us’, and yet this liberal elite sanctimonious mob have the temerity to relentlessly assert they are guardians of ‘expert’ facts and evidence, whereas Brexiteers are mindless Daily Mailers.

    Thank goodness May is set to lay into the sneering, arrogant liberal elites today.

  24. Chris
    Posted October 5, 2016 at 10:19 am | Permalink

    There is much speculation today that Theresa May will go into the negotiations looking at a clean break but be prepared for a single market solution. I note a comment on the eureferendum blog website which refers to this and to Laura Kuenssberg who claims to have been briefed by Downing Street (also backed up by Anna Soubry last night apparently). I must say I find this constant to and fro from one position to another not helpful, nor the apparent ambiguity in Theresa May’s words which allow such interpretations.

    Comment from R North site
    “…Laura Kusenberg has reported that she has been briefed by No10 that single market membership is not out of the question. Andrew Neil thinks she going to go into the negotiations asking for the lot, and perhaps including membership.

    All this comes back to the thought that TM didn’t say very much in her speech. She threw a few bones to those feeling a touch impatient, none of which were a surprise to anyone who has been watching, but otherwise continues to keep her options open…”

  25. CHRISTOPHER HOUSTON
    Posted October 5, 2016 at 10:25 am | Permalink

    The IMF cannot be taken seriously.

    Ms Lagarde spoke publicy only a few months before the Referendum and I offered a Comment here in this regard which was not published.

    She announced that “her team” had based part of its economic analysis of the UK on “the betting odds” on a Leave vote. She was confident the British people would vote to Remain. She and her team were unaware, of course, that the betting odds are affected by singular very large bets rather more than in this case by far more numerous small single bets; therefore, they do indicate gambler-intention in regard to voting and most certainly voter-intention in general.
    To have such a body as the IMF even contemplating for a split second and basing ANYTHING on what she described as “the odds at the bookies” is so perverse, so bizarre that it defies belief.

  26. The Prangwizard
    Posted October 5, 2016 at 11:14 am | Permalink

    Off topic, but I wish to put down my marker that I am appalled, embarassed and shamed for my country that your government Mr Redwood is allowing, not preventing the purchase of French steel for our submarines.

    Just how far are your people prepared to go to allow such a national decline such as this. I have commented many times that if vast tracts of our infrastructure and strategic assets are sold to foreign interests so city spivs can profit, ensuring our life blood is pissed away, whose nation is it? Just whose Mr Redwood? I wanted out of the EU, I voted for taking back control. I didn’t expect the sellout to continue.

    If Mr Corbyn says he will stop it by embarking on a nationalisation programme, I’ll be with him. I am sick of your betrayals of my nation.

  27. agricola
    Posted October 5, 2016 at 12:03 pm | Permalink

    Mrs May should be congratulated on her revolutionary blueprint for a future UK. Additionally I got the impression she believes in what she said, rare on such occasions. I hope that she gets all the support necessary to carry it out.

  28. Denis Cooper
    Posted October 5, 2016 at 12:55 pm | Permalink

    Two weeks ago I referred to a Treasury Committee meeting when the Tory MP Mark Garnier stated that although 2.2 million people are employed in financial services in the UK no more than “tens of thousands” would be involved in selling anything to the rest of the EU:

    http://johnredwoodsdiary.com/2016/09/21/mr-carney-is-not-an-unreliable-boyfriend/#comment-833246

    I suggested that it would be good if that claim could be substantiated, and some evidence has now appeared via the FT, but also here without a paywall:

    http://news.efinancialcareers.com/uk-en/257632/oliver-wymans-guide-keeping-banking-job-brexit/

    “Oliver Wyman’s guide to keeping your banking job after Brexit”

    “Reports of the City of London’s demise after Brexit may have been greatly exaggerated. This is the key message from the big new report on the impact of Brexit on Britain’s financial services sector.

    Written by consulting firm Oliver Wyman on behalf of campaigning organization TheCityUK, it provides the best snapshot yet into banks’ thinking on Brexit and was expected to confirm the gloomiest prognoses banking job cuts and offshoring. It some ways it does, but it also suggests that even after a hard Brexit, the very vast majority of jobs in the City of London will be unaffected.

    In the worst case ‘hard Brexit’ scenario, where the UK has no preferential access to EU financial markets and is operating on WTO rules only, Oliver Wyman thinks 31,000 to 35,000 jobs could be directly at risk and that a further 34,000 to 40,000 jobs could disappear from London due to second order effects (like increased costs, which result in entire business lines being shifted overseas).”

    I’m not indifferent to the plight of those who might lose their present livelihoods as a consequence of the intransigence of fanatics like Verhofstadt who are prepared to sacrifice free trade, and people’s jobs, on the altar of their eurofederalism, once again putting their warped geopolitical aims above any practical economic considerations, just as they did with the creation of the euro; but the fact is that 35,000 jobs would be only about 0.1% of the 31.6 million jobs in the UK economy, where at least in good times about 4 million jobs are created and 3.7 million jobs are lost each year:

    https://iea.org.uk/publications/research/the-eu-jobs-myth-0

    “The UK labour market is incredibly dynamic, and would adapt quickly to changed relationships with the EU. Prior to the financial crisis, the UK saw on average 4 million jobs created and 3.7 million jobs lost each year – i.e. there is substantial churn of jobs at any given time.”

    35,000 corresponds to less than one week of that “churn”.

    • Denis Cooper
      Posted October 5, 2016 at 1:05 pm | Permalink

      Oh, by the way, I may seek crowd funding to bring criminal charges against those who were responsible for the “greatly exaggerated” predictions of the demise of the City if we voted to leave the EU, false predictions which they knowingly designed to mislead the electorate and procure a vote to stay in the EU.

      Reply Why don’t we all move on from the exchanges of the campaign.

      • Denis Cooper
        Posted October 6, 2016 at 7:02 am | Permalink

        It’s extremists on the other side who won’t do that.

  29. Brood
    Posted October 5, 2016 at 1:14 pm | Permalink

    PM Mrs May’s final speech to the Tory Party Conference. It was better than her first-day speech.
    She speaks of “working-class”, “government intervention in industry” and yawning odd references to “the centre ground” in politics vacated she says by Labour under Corbyn.

    One: Few would consider themselves in a “class” except if pressed for a stereotypical answer by a doorstep canvasser with rained-on ticksheet in hand. People feel sorry for poorly-paid canvassers. They like to give them answers which neatly fit into their boxes.

    Two: Government intervention may be an idea for any “bumps along the road in brexit” as a short-term measure. But no further than that. Such an ideological approach to politics/economics by Obama and Co has placed the USA in devastating debt with industries which are dependent on state handouts for their survival. You can’t build a Free Trade economy on a topsy-turvy version of massive welfare benefits doled out not to the unemployed working class but to businesses who should be able to stand on their own two feet. It builds dependency, slipshod work, and “off to the golf club each Friday afternoon” by boss-idlers.Have Conservatives lost their minds? Grammar schools appear to have imparted acute economic/politic amnesia in Tory ranks.

    Three: Labour has not moved away from the Centre Ground. The 271 Labour MPs. It is they, who have moved to the ultra-right warmongering anti-workingclass care-less position of Blair the Impaler.

  30. margaret
    Posted October 5, 2016 at 1:22 pm | Permalink

    I was pleased to hear Mrs May talk about ‘our day’. I have been irritated by those who say ‘what was it like in your day .’ I remind them that I am still alive and this is my day . It is my day as long as I am alive . The your day people were the 2o/30 year old graduates under labour control . Now it is everybody’s day.

  31. Peter VAN LEEUWEN
    Posted October 5, 2016 at 1:23 pm | Permalink

    Forecasts are only forecasts.
    I’m happy the UK is doing so well, economically. This is good for the Netherlands, which with its open economy is always very reliant on trade partners.
    Post-Brexit I’ll look forward to a lot of UK FDI into the Netherlands, just like the Japanese had FDI into Britain, using it as a hub for sales to the rest of the EU. We already oblige by producing your Morris Mini for you and the steel factory is surviving well (Tata Steel handing the Dutch workers a 5-year job guarantee today on the back of investments) but there must be other sectors where the mighty Brits could use the Netherlands as a future hub for sales into the EU. So don’t forget, Holland, as your humble servant. is open for business! 🙂

    • Edward2
      Posted October 5, 2016 at 4:13 pm | Permalink

      I find people in the UK love Dutch people.
      I’ve been to your country several times for business and holidays and never have I been less than delighted by every person I met.
      We seem to have a similarity of outlook on life.
      If only we could be a good at learning languages as most Dutch people are.
      Trade with the Netherlands should be easily organised with the UK offering a free trade deal.

    • fedupsoutherner
      Posted October 5, 2016 at 6:59 pm | Permalink

      I see that the Netherlands might also want to vote out. Couldn’t say I blame them. If they see we are doing ok how many more will follow us?

      • Peter VAN LEEUWEN
        Posted October 5, 2016 at 9:21 pm | Permalink

        @fedupsoutherner: I don’t see what you see, the Netherlands is not going to leave the EU.

  32. hefner
    Posted October 5, 2016 at 2:27 pm | Permalink

    FTSE100 at 7100+ on 05/10, 6800+ on 06/10 … better stick to ETFs and tracker funds, this will prevent some (former) analysts to sound ridiculous. And even the 7100 was hardly compensating for the drop of value in the £.

  33. Ronald Olden
    Posted October 5, 2016 at 8:31 pm | Permalink

    I had the misfortune to watch the IMF Spokesman on the TV delivering this rubbish. He also commented on how the IMFs forecast for growth in the latter part of 2016 was catastrophically wrong and that we would be the fastest growing economy in the G7 after all.

    His response (in nutshell) was, that they were right to warn of the worst case scenario. These are supposed to be forecasts, not warnings of what the worst case scenario might be when you don’t get you own way. I don’t remember any best case scenario being published.

    These people are getting paid pubic money to produce this rubbish. The UK taxpayer part funds the IMF.

    Perhaps the IMF would now like to tell us what its’ growth forecast for 2017 would have been had we not had the Sterling depreciation, the £60 Billion of quantitative easing, various other Bank of England measures, and the interest rate cut, all of which were prompted by the Leave Vote.

    Hardly any of this easing, let alone the fiscal relaxation which is anticipated for the coming years, has had any chance to work yet. So if against this background, the IMF’s 1.1% forecast for 2017 is correct, we would, have been close to, or actually in, recession by 2017, had we not voted Leave.

    And why is the IMF’s 2017 forecast predicated on a ‘a limited increase in economic barriers’ We’ll still be in the EU at the end of 2017 so what ‘barriers’ are the IMF now supposing will be erected amongst existing EU Members’.

    I’m forecasting growth of 2% for 2017. I would bet my house that my forecast will be closer to the actual outcome than the IMF’s, and I’m not charging Millions of Pounds to produce it. The UK should stop spending money in this useless political organisation.

  34. Dennis
    Posted October 6, 2016 at 4:11 pm | Permalink

    The £ rising against the Yen? This is a useless statement without further info. Perhaps the Yen is falling.

  • About John Redwood


    John Redwood won a free place at Kent College, Canterbury, and graduated from Magdalen College Oxford. He is a Distinguished fellow of All Souls, Oxford. A businessman by background, he has set up an investment management business, was both executive and non executive chairman of a quoted industrial PLC, and chaired a manufacturing company with factories in Birmingham, Chicago, India and China. He is the MP for Wokingham, first elected in 1987.

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