"CBDCs are about ways of making payments; they are not a new currency."
"Whether a country needs a CBDC is really about the state of its current payments system," he pointed out in the House of Lords this month..
"What are the problems in our payments system to which a CBDC might be the answer? .... There are no problems to which a CBDC is the only, or even the most obvious, answer."
"Our payments system is more efficient than those in most other countries, certainly the United States."
"Most transactions are already digital, whether by tapping a card on a machine at the point of sale or making a digital payment on a computer for remote transactions."
"All of these are operated already by commercial banks and an increasing number of new payment vehicles."
"Competition has moved us from a system based on paper cheques to one driven largely by digital payments with virtually instantaneous clearing."
"It would be somewhat odd to try to increase competition in this area by creating a state monopoly of the payment system"
"Of course, there can always be improvements in our payment systems, but a CBDC is neither a necessary nor a sufficient condition for that.
"The major problem today concerns the cost and speed of cross-border payments, but much of this results from money laundering regulations."
"The enormous risk is that, in a financial crisis, households would abruptly shift their deposits from banks to [CBDC] accounts with the Bank of England, forcing the latter immediately to transfer the deposits back to the banks to avoid a collapse of the system."
"In 2008, when the Bank, with approval from the Government, lent a large amount of money to RBS and HBOS to prevent their collapse, the operations were covert and revealed only some months later to prevent a system-wide loss of confidence"
"That would be impossible if households could switch without limit instantaneously from all commercial banks to the Bank of England."
"So a retail CBDC has risks but no obvious benefits".
Lord King, from a position of immense experience, has completely demolished the case for a "Britcoin," British CBDC or "digital pound."
It thus remains quite puzzling why the Government and Bank of England are pressing ahead with such vigour? What are their real motives?
Keir Starner has appointed a Housing Minister who hates private housing.
Miatta Fahnbulleh, former CEO of the far left New Economics Foundation (NEF), wants to tax & regulate private housing to death and build state housing instead.
1/11
Miatta & the NEF are fixated on forcing the transfer of private rented homes to the public sector. "Policy should be geared towards upgrading existing private rented homes to ensure they are energy efficient, & acquiring & repurposing them as homes for social rent," they write.
"Social housing held and controlled by the public sector is best placed to meet social policy needs," they say.
They are not keen on the private sector building more houses, sniffily noting that "meeting the housebuilding targets would make it impossible for the UK to achieve its commitment to its carbon reduction goals by 2050."
Miatta herself campaigned against a private housing development in Peckham, saying "I support building homes on the Aylesham site — but they must include the right amount of social and affordable housing.”
Of course housing developments aren't viable on those terms.
Keir Starmer has appointed a high tax fanatic, Minouche Shafik, as his personal economic adviser.
Shafik is a collectivist academic who believes that “the idea that you are successful because you are smart & hardworking is pernicious & wrong."
She is a menace. 1/6
She wants to grab people's pension pots, saying "those with comfortable pension pots must be expected to pay more towards the common good.”
She also proposed “the imposition of property taxes which would direct a flow of capital from those in high value properties to those unable to get on the property ladder, through a capital endowment scheme.”
She co-chaired Torsten Bell's ‘Economy 2030 Inquiry’ which proposed a vast number of tax hikes, including the following:
Cut the VAT registration threshold to £50,000 then £30,000.
Create Road Duty for EVs.
End free carbon permits & introduce carbon border adjustment.
Encourage local congestion charges.
Charge Capital Gains Tax on death and when moving out of UK.
Scrap non-dom status.
Hike national insurance for higher self-employed incomes by 300% to 8%.
Hike basic rate of Dividend tax from 8.75% to 20%.
Introduce NI for rental income.
Extend employer NI to employer pension contributions.
Cut the £270,000 cap on tax-free pensions to £40,000.
Make everyone pay inheritance tax by scrapping the nil-rate band.
Hike vehicle excise duty for heavier cars.
Introduce pay-per-mile road duty for electric vehicles.
Scrap business and agricultural property reliefs.
Raise CGT on shares to 37% and real estate to 53%.
A branch manager of a lettings business was awarded a £25,000 bonus, but was horrified to learn that he would be left with less than nothing after tax. As a result of his £25,000 bonus, £25,533 would be taken by the tax man.
1/4
Over £100k the tax rate on his £25,000 bonus was 60% i.e. £15,000. "On top of this, he pays 2% NI plus another 9% is deducted to pay for this student loan which is really a graduate tax. This means an effective tax rate of 71% i.e. £17,750." writes Adam Walker
"As if this isn’t bad enough he has a 2-year-old daughter. Because he earned too much, he had already lost his right to claim child benefit which is worth £1,354p.a. However, his bonus £25,000 bonus means that he also no longer qualifies for 30 hours per week of free childcare which is worth a further £7,783p.a.. "
"When you add all this together, the impact of his £25,000 bonus is that the poor chap will be £533 worse off. He was so disgusted by this that he asked his employer to pay the whole of his bonus into his pension. This avoided the tax but it didn’t make him feel any less resentful."
"At the age of 28, he was looking forward to spending his hard-earned bonus on something nice not locking it up in a pension that he cannot spend for another 30 or 40 years.
As a consequence, their star manager who they so desperately wanted to keep decided to leave & take a job in Dubai."
"As we talk about the tax-raising budget to come we should not think of it as inevitable. It would be a gross breach of promise. It was what Labour were elected not to do, what they told us all that they would not do," says Danny Finkelstein in @thetimes
It's a key point
1/4
"Labour ran for office saying repeatedly that their plans were “about prosperity, not higher taxes”. At its manifesto launch Angela Rayner announced that “we can’t tax our way to growth.” To which Rachel Reeves added that “we don’t have a tax-and-spend manifesto. We have a growth plan.”
“There is nothing in our plans that requires any further increases in taxes, I have confidence in that. Voters can have confidence,” Rachel told Sky News.
"All of our plans are fully funded and fully costed and none of them require tax rises over and above the ones that we’ve already announced,” said Keir
No wonder the bond markets are worried that Torsten Bell is writing the budget. Not only does he advocate growth-destroying tax hikes but he has consistently pushed for higher public spending & the rewriting of fiscal rules to permit yet more borrowing
Examples below: 1/7
In “The end of austerity?” (Resolution Foundation blog, 13 Jun 2017) Bell argued that ending austerity should mean lifting the public-sector pay cap and reversing benefit cuts. “…An extra £3bn a year would be needed for a 1% pay rise," he said.
In “The end of austerity? Not so much” (RF blog, 3 Oct 2018) he said halting the planned fall in day-to-day departmental spend required £12bn extra annually by 2022–23.
In “The Budget marks a very significant easing – but not an end of austerity” (RF blog, 30 Oct 2018), he said argued that greater departmental spending was required to end austerity.
"Reeves is increasingly beginning to look like the Starmer government’s ‘starter chancellor’ – who will pave the way for a more radical programme at some later date. Her failure to stimulate growth will be used as a pretext for something a little more ambitiously left-wing."
"Were Torsten Bell to be the follow-up figure, we would at least know where we are, given that he appeared to enjoy an open invitation onto the Today programme in the years leading up to the general election to expound on his ideas for tax rises. But it would be a dark day for the UK economy, ditching us in even deeper fiscal waters."
Prescient commentary from @RossjournoClark in April.
1/4
"That the Resolution Foundation seems to think that the answer is yet more public spending says much about the Labour Left’s philosophy. Economic growth, it seems to believe, can only ever result from public investment, not private investment," notes Ross Clark
"If you want genuine growth in the economy, the sector that you most want to invest is surely the more productive part – the part which is growing productivity, not shrinking it. Instead, the government is taking money out of the private sector and putting it into a moribund public sector which has failed to improve productivity in a quarter of a century."