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Updated 2018-12-09 23:17
Never mind the Brexit sideshow – recession is the real worry | Larry Elliot
Markets are more jittery about the prospect of a downturn than May’s doomed dealIt is crunch time for and Theresa May and the financial markets are in turmoil. The drama at Westminster has been mirrored by drama on stock markets, with share prices tumbling and money flooding into the customary safe haven assets – gold and government bonds. Squeaky bum time all round.None of this really has much to do with May’s doomed Brexit agreement, because the City has known since the minute the deal was signed that it had zero chance of getting parliamentary approval. Investors will only really get interested in events at Westminster if defeat for May is followed by a period of political paralysis or – even worse as far as the financial markets are concerned – the prospect of a Labour government. Continue reading...
Why are so many UK businesses just barely managing to get by? | Phillip Inman
Foreign-owned businesses are more productive than British firms and it’s all down to their superior management skillsAs Britain walks closer to the EU’s exit door, it is worth considering the nation’s capacity to survive without, as the Bank of England governor, Mark Carney, would say, the kindness of strangers.The strangers in this case are foreign investors and the foreign companies they own, which are based in the UK either to sell stuff to the domestic market or as part of a global network of suppliers.Related: Productivity woes? Why giving staff an extra day off can be the answer Continue reading...
Wall Street suffers worst week since March as trade wars worry investors –as it happened
US economy only created 155,000 new jobs last month and wage growth disappoints
The Guardian view on women’s rights: do not take progress for granted | Editorial
Austerity, as the UN’s poverty expert noted, is especially harmful to women. The economic shock from Brexit is likely to widen the inequality gapWhen Theresa May became prime minister and set out her vision, women were among the groups she promised to champion. She cited unequal pay on a list of “burning injustices” alongside race and class inequalities. This year companies with more than 250 employees were for the first time compelled to report on their gender pay gap. This can be calculated in different ways, but the Office for National Statistics has it at 17.9%, down 0.5% from last year. At this rate it will be decades before women and men are paid the same, but the data is moving in the right direction.Unfortunately, even such modest progress is the exception rather than the rule in 21st-century Britain. Unpalatable though it may be both to ministers and feminists, the evidence suggests that women’s advancement has stalled and is in danger of going backwards – if it is not doing so already. The government did not accept last year’s finding by the House of Commons Library that 86% of the burden of austerity since 2010 has fallen on women – £79bn, against £13bn for men – and refuses to conduct its own analysis. But work by the Institute for Fiscal Studies, Women’s Budget Group and Runnymede Trust has shown that women, and particularly BAME women, are disproportionately affected by cuts to public services and other spending. Continue reading...
UK 'will need to cut taxes or boost spending at next downturn'
Effectiveness of monetary policy will be limited in next recession, say ex-BoE officialsThe government will need to cut taxes or boost spending when the next economic downturn arrives, according to two former Bank of England officials who said the central bank was low on firepower.The former deputy governors Rachel Lomax and Sir Charles Bean warned ministers they will be unable to rely on monetary policy to combat the next recession now that interest rates are at historically low levels.Related: Central bank warnings on the global economy are getting louder Continue reading...
EU support for austerity opens door to far right, Corbyn says
Failed neoliberal policies have caused serious hardship, leader tells European socialists
Brexit is about more than immigration | Letters
John Whitley says anger over austerity should be directed against the UK government, and Danny Tanzey thinks simplistic explanations do not apply hereDan Rainey letter (6 December) on immigration accurately reflects some of the perceptions about immigration. But perceptions are not evidence when they are not supported by facts. Most studies show that immigration has not reduced wage levels and has actually increased economic activity since immigrants are typically younger and pay more in taxes than they take out in benefits.The lack of housing is not from extra demand from immigrants but rather a decade-long failure of housing policy to increase the number of homes available. More importantly, the reason why incomes of the average worker have stagnated is not immigration but the effects of austerity. Immigration is the wrong target. Continue reading...
UK house price growth slips to six-year low amid Brexit uncertainty
Prices grew by only 0.3% in the year to November, down from 1.5% in October, Halifax saysHouse prices grew at the slowest rate in almost six years in November, as wavering consumer confidence before the UK’s departure from the EU took its toll on the housing market.Prices grew by 0.3% in the year to November, down from 1.5% in October, according to the Halifax house price index, published on Friday. Continue reading...
Stock market turmoil wipes £56bn off FTSE 100, in worst day since Brexit vote - as it happened
London stock market has suffered its worst day in over two years, as the FTSE 100 falls by 217 points (3.15%) to 6704
China to 'immediately' apply measures agreed in trade truce with US
Commerce ministry says China will ‘implement consensus’ on farm products, cars and energyChina has said it will immediately implement measures agreed under a trade war “truce” with the US.The commerce ministry’s remarks came days after Donald Trump and his Chinese counterpart, Xi Jinping, agreed to give negotiators 90 days to resolve their trade spat. Continue reading...
Central bank warnings on the global economy are getting louder
The reasons to stay awake at night are multiplying – let’s hope this time we have priced the risks correctlyWhen I took over responsibility for banking supervision in the United Kingdom, in 1995, a wise old bird in the Bank of England (BoE) warned me that I would find it a thankless task. No newspaper ever prints a headline reading “All London Banks Safe and Sound this Week”. But if a problem occurs, it is almost invariably seen as a case of supervisory failure. Dozy watchdogs asleep at the wheel are a trope that trips quickly into journalists’ coverage.Regulators are caught in a crossfire of conflicting expectations. Banks want to be left alone, unless they need help. Consumers and their political representatives want regulators to be aware of every transaction, ready to intervene in real time if any glitch occurs. In the years running up to the 2008 financial crisis, the pendulum swung toward the non-interventionist end of the spectrum. Today, “intrusive” has a positive connotation in the regulatory lexicon. But the need to strike a sensible balance remains.Related: GDP is not a good measure of wellbeing – it's too materialistic | Joseph Stiglitz1. Extreme weather events Continue reading...
Chancellor Philip Hammond says Brexit betrayal would cause more damage than leaving EU – as it happened
Hammond tells MPs that Brexit will lead to slower growth, but it’s worth it
EU’s dependence on dollar to be reduced under new proposals
Europe is being affected by the threat of US sanctions on firms that trade with IranPlans to reduce European Union dependence on the US dollar – and so improve the bloc’s ability to run an independent foreign policy that is less exposed to US sanctions – were unveiled on Wednesday by the European commission.The proposal has grown in significance for European integrationists as firms from EU countries withdraw investments from Iran faced by the threat of punitive secondary sanctions from the US.Related: Why a rising dollar risks unbalancing the world outside the US | Mohamed El-ErianRelated: Can Trump strike the right balance on monetary policy? Continue reading...
No-deal Brexit fears prompt UK economy to flatline
Service sector firms rein in activity to levels last seen just after EU referendumThe risk of a disorderly Brexit caused the British economy to almost flatline last month as service sector firms reined in business activity to the weakest level since immediately after the EU referendum two years ago.According to a shock health check from IHS Markit and the Chartered Institute of Procurement and Supply (Cips), the biggest sector of the economy, which includes banks, hotels and restaurants, recorded only very marginal expansion in output last month. It was the worst monthly data since the immediate aftermath of the Brexit referendum in July 2016.Related: Brexit betrayal would damage society, Philip Hammond tells MPs Continue reading...
Mervyn King's call for no-deal Brexit fails to offer solutions | Nils Pratley
King’s attack on Theresa May’s Brexit did not give us an estimate of the economic damageSome would say governors of the Bank of England should slip quietly into the shadows after leaving office, but at least Mervyn King offers value for money when he steps on to the stage. His attack on Theresa May’s Brexit deal was a blistering and inflammatory must-read.“There is no case whatever for giving up the benefits of remaining without obtaining the benefits of leaving,” Lord King wrote, which is a well-crafted line that remainers and leavers alike might support. Similarly, the comments about “vassalage” will chime with opponents to May’s deal from both camps. Jo Johnson, when he quit the cabinet and called for a second referendum, described the Brexit process “a failure of British statecraft on a scale unseen since the Suez crisis”. King went bigger by drawing a comparison with 1930s appeasement. Continue reading...
Bank of England governor slams critics over Brexit analysis - as it happened
Mark Carney has defended his warning that disorderly Brexit would cause economic harm, as Jacob Rees-Mogg is accused of ‘contemptuous’ remarks
Four million British workers live in poverty, charity says
Number of workers entering poverty rising faster than employment, says Joseph Rowntree FoundationMore than 500,000 British workers have been swept into working poverty over the past five years, according to a report that shows the number of people with a job but living below the breadline has risen faster than employment.In the latest sign that the link between entering work and making ends meet has become increasingly frayed in 21st-century Britain, the Joseph Rowntree Foundation (JRF) said that the number of workers in poverty hit 4 million last year, meaning about one in eight in the economy are now classified as working poor. Continue reading...
Sports Direct's Mike Ashley calls for web tax to save 'dying' high street - as it happened
UK retail boss calls for new tax on web retailers, and faces criticism over House of Fraser takeover
Trump’s trade war truce with China fragile and hurdle-strewn | Nils Pratley
Despite stock markets surging, timeframe for reaching deal to end hostilities appears too tightAs ever with financial markets, what matters is the difference from expectations. Investors did not think the G20 summit would produce an easing of trade tensions between the US and China, therefore stock markets surged after Donald Trump declared that relations had taken “a BIG leap forward”.Yet it is only sensible to believe Trump’s hyperbole when there is something on the table to inspect. All that has been agreed so far is a pledge to keep talking until March. The tariff increases the US had planned for January won’t go ahead, which is clearly positive for markets, but it requires extreme optimism to believe a three-month truce can produce a negotiated deal on all the areas in the Trump administration’s sights. Continue reading...
Quarter of shop space in England and Wales lost after 2008 crash
Amount of space fell in all but five local authorities between 2008 and 2015, study findsMore than a quarter of all retail floor space in England and Wales disappeared in the aftermath of the 2008 financial crisis, research has shown, as the industry struggled with the shift to online purchases.The amount of shop space fell in all but five of 348 local authorities analysed in the study by academics at Northumbria University, Newcastle. Continue reading...
GDP is not a good measure of wellbeing – it's too materialistic | Joseph Stiglitz
Why focus on production of goods, rather than on health, education and environment?Just under 10 years ago, the international Commission on the Measurement of Economic Performance and Social Progress issued its report, Mismeasuring Our Lives: Why GDP Doesn’t Add Up. The title summed it up: GDP is not a good measure of wellbeing. What we measure affects what we do: if we measure the wrong thing, we will do the wrong thing. If we focus only on material wellbeing – on, say, the production of goods, rather than on health, education, and the environment – we become distorted in the same way that these measures are distorted; we become more materialistic.We were more than pleased with the reception of our report, which spurred an international movement of academics, civil society, and governments to construct and employ metrics that reflected a broader conception of wellbeing. The OECD has constructed a better life index, containing a range of metrics that better reflect what constitutes and leads to wellbeing. It also supported a successor to the commission, the High Level Expert Group on the Measurement of Economic Performance and Social Progress. Last week, at the OECD’s sixth World Forum on Statistics, Knowledge, and Policy in Incheon, South Korea, the group issued its report, Beyond GDP: Measuring What Counts for Economic and Social Performance.Related: Trump's trade wars and Brexit are making us all poorer | Jeffrey Frankel Continue reading...
World Bank to invest $200bn to combat climate change
Sum available for 2021-25 represents doubling of current five-year planThe World Bank is to make about $200bn (£157bn) available to fund action on climate change from 2021-25, helping countries adapt to the effects of warming and reduce greenhouse gas emissions.The sum represents a doubling of the five-year investment plan put in place after the landmark Paris agreement of 2015. Continue reading...
UK manufacturers stockpile goods ahead of Brexit
Firms fear imports of raw materials will dry up or rise in price when Britain leaves the EU, survey saysManufacturers are stockpiling goods ahead of March’s Brexit date as the prospect of queues at Britain’s ports grows more likely.Production remained strong across the manufacturing sector in recent months, with firms fearful that imports of raw materials will dry up in the event of a no-deal Brexit or go up in price should a deal go ahead. In response, they are making as many goods as possible and piling them up in storage, according to a quarterly survey from the EEF, the manufacturers’ trade body. Continue reading...
The WTO could be dancing its last tango, strictly speaking
Trump and Xi’s truce at the G20 is a start but international trade still stands at the crossroadsContestants on Strictly Come Dancing dread the Argentine tango. No matter how good the choreography, it is technically tricky and devilishly difficult to get right.So the audience was holding its breath as Donald Trump and Xi Jinping got into hold for their own version of the dance in Buenos Aires this weekend. Trade tension between the world’s two biggest economies has increased markedly over the past 12 months and the chances of what Strictly judge Craig Revel Horwood calls a “dance disaster” were high.Related: The Observer view on Donald Trump’s growing list of failures | Observer editorial Continue reading...
Attack on the Fed is Trump’s opening salvo in 2020 re-election campaign
Strains are showing in the US economy and the president knows a downturn would harm his chances for a second termThe strong economy that helped Donald Trump scrape through the midterm elections looks like it might make itself absent when he runs for re-election in 2020. In recent months, strains have started to appear that belie America’s vigorous headline growth rate and its buoyant jobs market.Last week the International Monetary Fund (IMF) warned that Trump’s escalating trade war with China was beginning to hurt global trade.Related: The G20: Donald Trump and the rise of the strongmen Continue reading...
The odds won’t stop May making this terrible gamble on Brexit
It wouldn’t be wholly surprising if the PM won the ‘meaningful vote’. But no one will give much for Britain’s chances if she doesUnlike some of the people I meet, I am not beginning to feel sorry for Theresa May. In the way she has handled her referendum inheritance from David Cameron, she has aggravated the crisis at almost every turn.The chaos the Conservative party has inflicted on this benighted nation is such that almost anything could happen in the next few weeks and months. Indeed, as a betting man (a small punter, not a serious gambler) I have placed a tiny bet that, notwithstanding the forecasts of almost every political pundit, her attempt to rally the electors to persuade their MPs to back her in the 11 December vote might just succeed against all the odds.Even Philip Hammond has had to concede that all Brexit scenarios involve self-inflicted economic damage Continue reading...
France is deeply fractured. Gilets jaunes are just a symptom | Christophe Guilluy
The author of a seminal account of French society charts widening cultural divisionsFrom the 1980s onwards, it was clear there was a price to be paid for western societies adapting to a new economic model and that price was sacrificing the European and American working class. No one thought the fallout would hit the bedrock of the lower-middle class, too. It’s obvious now, however, that the new model not only weakened the fringes of the proletariat but society as a whole.The paradox is this is not a result of the failure of the globalised economic model but of its success. In recent decades, the French economy, like the European and US economies, has continued to create wealth. We are thus, on average, richer. The problem is at the same time unemployment, insecurity and poverty have also increased. The central question, therefore, is not whether a globalised economy is efficient, but what to do with this model when it fails to create and nurture a coherent society?'Workers' no longer live in areas where employment is created, giving rise to a social and cultural shockRelated: France’s ‘gilets jaunes’ leave Macron feeling decidedly off-colour Continue reading...
Trump signs trade pact with Canada and Mexico to replace Nafta
Each country’s legislature must also approve the agreement but Democrats in the US are already demanding changes
Nine in 10 firms say Brexit affecting recruitment – CBI
Business group warns of growing shortages across all skills levelsNine in 10 businesses say Brexit has affected their ability to recruit and train staff this year, the Confederation of British Industry has said.The Recruitment and Employment Confederation, the professional body for the recruitment industry, says the public sector, including the NHS and schools, face up to seven more years of skills shortages, based on current demand. Continue reading...
Brexit: Theresa May says McDonnell wants to overturn will of British people – as it happened
Rolling coverage of the day’s political developments as they unfolded, including Theresa May and Jeremy Corbyn at PMQs and the publication of the government’s official analysis of the economic impact of Brexit
Bank of England warns no-deal Brexit would cause historic downturn - as it happened
UK central bank outlines scenario of falling house prices, a sterling crisis and a shrinking economy, but critics aren’t convinced
Carney's pessimistic Brexit prophecies look like last roll of dice | Larry Elliott
Bank of England governor says we must prepare for the worst, but will anyone listen?A bigger slump than the one that followed the financial crisis. A 25% fall in the value of the pound. An annual inflation rate of 6.6%. Official borrowing costs up to 5.5%. Our job, Mark Carney said, is not to hope for the best but to prepare for the worst.And the governor of the Bank of England certainly laid it on. Asked by MPs on the Treasury select committee to imagine what could happen to the economy in the worst possible scenario, Carney painted a bleak picture of goods not clearing customs, the EU refusing to accept UK products and financial markets in meltdown.Related: Labour will inevitably back second Brexit referendum, says McDonnell Continue reading...
The problem with neoliberalism | Letters
Michael Greenwood, Geoff Naylor and David Murray on the failures of economic policyWhile agreeing with the thrust of Paul Mason’s article (A new politics of emotion is needed to beat the far right, Journal, 26 November), it is surely necessary to employ economics if we are to defeat neoliberalism. We have lived under this regime, with increasing severity, for 25 years or so. The result has been the stagnation of real incomes for the large majority, with the benefits of GDP growth accruing to those at the top of income and wealth distributions. This has suppressed growth, as those with less money tend to spend it and those with more hide it and avoid tax. Lower UK growth is clearly shown in comparative data.So if neoliberalism is a school of economics, it is a failure if the aim of economic policy is to encourage growth and the reinvestment of the benefits. Of course, neoliberalism is not economics, it is political dogma, supported by its beneficiaries. We need economics undergraduates to demand to be taught real economics and not the propaganda of power that is neoliberalism.
UK banks can survive a disorderly Brexit, says Bank of England
Latest stress tests examine worst-case scenario of a credit crunch-style economic shockUK banks are strong enough to survive a disorderly Brexit that could leave the country worse off than the 2008 financial crisis, according to the Bank of England.Related: Bank: no-deal Brexit will be worse than the financial crisis - business live Continue reading...
Bank of England says no-deal Brexit would be worse than 2008 crisis
Bank warns of immediate economic crash, GDP to fall by 8%, unemployment to rise to 7.5%Britain crashing out of the European Union without a deal could trigger a deep and damaging recession with worse consequences for the UK economy than the 2008 financial crisis, the Bank of England has warned.Related: UK significantly worse off under all Brexit scenarios – official forecastRelated: This Brexit deal would be a disaster for innovators and entrepreneurs | Deborah MeadenRelated: UK banks can survive a disorderly Brexit, says Bank of EnglandThe @bankofengland #Brexir analysis is highly speculative and extreme. It will add to the view that the Bank is getting unnecessarily involved in politics and that will further undermine perceptions of its independence and credibility.And I won't make a full judgement until I see the details. But their bad-case losses from a no-deal Brexit look extremely high. I mean, 8 percent of GDP was the kind of estimate we used to make for countries with 150 percent effective rates of protection. 2/ Continue reading...
There can be no doubt any more: Brexit will make us poorer | Jonathan Portes
Three separate reports published this week have each reached the same conclusion. Britain will be worse off outside the EUYou wait for months for an analysis of the economic impacts of Brexit, and then three come along at once. But, in contrast to the public perception that economists can’t agree on even the most basic questions, like whether austerity was necessary or desirable, what is most striking about the reports published this week is how much they have in common. All three analyses this week (a report funded by the People’s Vote and produced by National Institute of Economic and Social Research (NIESR); the UK in a Changing Europe report that I and Thomas Sampson of LSE co-wrote; and, most importantly, today’s “cross-government long-term economic analysis”) all share the same basic messages.Related: Frictionless unicorns, ‘max fac’ and cake: your guide to Brexit lingo | Hannah Jane ParkinsonIf MPs reject the deal, there are seven possible paths the country could go down next.
This Brexit deal would be a disaster for innovators and entrepreneurs | Deborah Meaden
We need frictionless access to markets and to encourage startups to build their businesses in the UK. Not a second-best dealYou don’t succeed in business by settling for second best, and successful entrepreneurs don’t roll over and accept defeat. That’s why I am so baffled by Carolyn Fairbairn’s surrender on Brexit.Writing in the Financial Times today Fairbairn, who heads the Confederation of British Industry (CBI) and is supposed to be the voice of British business, says that the prime minister’s deal is “not perfect” but that “the majority of businesses support it”.Related: Business leaders call for second Brexit referendumRelated: Forget the people’s vote, parliament should ditch Brexit | Steve Richards Continue reading...
UK significantly worse off under all Brexit scenarios – official forecast
Analysis produced by range of government departments suggests GDP could fall by 10.7%• Follow the latest politics news - live updatesThe UK would be significantly worse off under all possible Brexit scenarios in 15 years’ time, according to a benchmark economic analysis produced by a range of government departments including the Treasury.The keenly anticipated document concludes that GDP would have been 0.6% lower under the Chequers plan in 2035-36 – although that has been ditched after a revolt from the Conservative right – and 7.7% lower in the event of the UK crashing out with no deal, when compared with the UK remaining in the European Union.Related: PMQs: Brexit analysis is meaningless, Corbyn tells May Continue reading...
UK car industry and Airbus cautiously back PM's Brexit deal
Representatives say possible EU agreement ends uncertainty and is better than the ‘cliff-edge’ of no dealThe automotive industry and Airbus have offered tentative support to Theresa May’s proposed Brexit deal, warning that the “cliff-edge” no-deal alternative would be much worse for the UK.Backing from representatives of an industry and a company that collectively support nearly a million jobs in the UK will boost the prime minister’s hopes of securing parliamentary approval for her plan ahead of the 11 December vote.Related: New blow for UK car industry as European parts factories close Continue reading...
Chancellor says UK will be worse off under all Brexit scenarios
As vote on Brexit deal looms, Philip Hammond says there is no version of leaving the EU that will increase prosperity• Follow the day’s politics news and reaction live updatesPhilip Hammond has said that the UK will be worse off “in pure economic terms” under all possible Brexit outcomes – including the prime minister’s own deal.Speaking on Wednesday morning, the chancellor gave strong hints the government had begun its contingency planning should it lose the vote in parliament on Theresa May’s Brexit deal negotiated with the EU.Related: Brexit phrasebook: a guide to the talks' key terms Continue reading...
Donald Trump warns China he won't back down on trade tariffs
US president says he expects to move ahead on plans to raise tariffs to 25% from 1 JanuaryDonald Trump has raised the stakes in the escalating global trade dispute between the US, China and some of America’s traditional allies ahead of a major gathering of world leaders this week.Ahead of the G20 meeting in Argentina, which begins on Friday, the US president used a newspaper interview to warn China that he expects to move ahead on the imposition of higher import tariffs on Chinese goods.Related: Trump's trade wars and Brexit are making us all poorer | Jeffrey Frankel Continue reading...
Trump's trade wars and Brexit are making us all poorer | Jeffrey Frankel
Current policies are hitting real incomes – and only voters, not central banks, can change thatThe world is in a trade war and there is no sign of peace breaking out anytime soon. By now, the disruption to trade appears extensive enough to factor negatively into forecasts for economic growth. Does that mean the Federal Reserve should stop gradually raising interest rates?The answer is no. Monetary policy cannot mitigate the damage done by foolish trade policies.Related: Does setting inflation targets cloud our view of the economy? | Robert Shiller Continue reading...
One in four UK workers covered by national living wage underpaid
Women more likely to be hit by underpayments than men, Low Pay Commission figures revealAlmost one in four British workers on the government’s national living wage are paid less than they should be, according to official figures, with more women than men hit by underpayments.The figures revealed by the government’s Low Pay Commission showed that 369,000 workers – representing about 23% of all of those over the age of 25 who are covered by the national living wage – were paid less than that amount this year.Minimum wages in the UK explainedRelated: UK has weakest wage growth in advanced G20 nations, says ILO Continue reading...
The Ex-Boyfriend Yard Sale: can you put a price on sentimental value?
In her solo show, Haley McGee values the gifts her exes gave her, while rating how much fun they were – and how good the sex wasImagine an episode of The Antiques Roadshow where the objects are all gifts from your old partners and a price is put on their sentimental value. What might that faded T-shirt or once-loved mixtape be worth in cash terms?In her performance The Ex-Boyfriend Yard Sale, currently at Camden People’s theatre in London, Haley McGee invites audiences to evaluate several presents from her exes. A coffeepot, a vintage typewriter, a guitar and a necklace are among the items displayed on plinths on the stage. When McGee reveals more intimate information about each relationship, we raise or lower our valuations accordingly. It all starts to feel like an alarmingly personal version of The Price Is Right. Continue reading...
Brexit weekly briefing: EU signs off on 'the only deal possible'
Now even harder work begins for Theresa May as she battles MPs over the withdrawal agreementWelcome to your Guardian weekly Brexit briefing, more necessary than ever as it all starts hotting up … If you’d like to receive it as a weekly email, please sign up here. And catch up with our monthly Brexit Means … podcast here.Finally, producing the Guardian’s independent, in-depth journalism takes time and money. We do it because we believe our perspective matters and it may be yours, too. If you value our Brexit coverage, please become a Guardian supporter. Thank you.May could bring it back for a second vote, perhaps with very minor tweaks.She could resign and be replaced by a different leader who could then appeal to a majority in parliament, perhaps by offering a softer deal.Tory backbenchers could depose her via a no-confidence vote.In an ultimate gamble, May could call a general election, appealing to voters to back her over the heads of squabbling MPs.Labour could try to force an election through a vote of no confidence.Calls for a second referendum could become impossible to ignore, especially if Labour decided to back them.Britain could crash out on 29 March without a deal.UK economy would be 4% smaller after 10 years under May’s Brexit plan, the respected economic forecaster NIESR says.European court rejects British expats’ referendum challenge.Figures show rise in EU nationals exiting public sector after Brexit vote.Knighted Tory MP Sir John Hayes says he still won’t back May’s deal.Blowtorches in Brussels as protesters demand a people’s vote.Britain on verge of historic blunder, Boris Johnson says at DUP conference.Philip Hammond insists Theresa May’s Brexit deal is better than staying in EU.So will Europe miss the UK when it’s gone? Probably not.The leave adviser Shanker Singham admits UK would be better off staying in EU.Majestic Wine to stockpile 1m extra bottles for no-deal Brexit.The Brexit political declaration – rated.The health secretary, Matt Hancock, says second Brexit referendum possible.Even as May shook hands with Jean-Claude Juncker, the political village was transforming itself into a noisy constitutional souk. At every stall, the traders offer alternative models: “Norway for now!”; “Canada ++!”; “Switzerland!”; “Get yer article 50 extension here!” None of these alternatives, it should be emphasised, has been seriously countenanced by the EU. But they are already being offered to curious MPs at early-bird prices. What unites this cacophonous marketplace is the absolute assumption that the deal will fail in December. The 585-page agreement and its 26-page political annex are already regarded as redundant. The variables are dizzying, the stakes vertiginous. The worst news for May is that the past two and a half years were the easy bit.Amazing that - yet again - we are 45 minutes in & still not single voice, from any party, including Tories, backing @theresa_may's Brexit deal. Even ultra loyalist Michael Fallon now puts the boot in - "is it really wise to trust future of our economy to use 'best endeavours'"? Continue reading...
Shares rally as Italy edges away from Brussels budget clash
Frankfurt’s Dax index rises by 1.45%, while the City’s FTSE 100 ends day up by 1.2%Italy has shown the first signs of backing away from a budget clash with Brussels, sparking a share rally in Rome.On a day when equities rose across the globe, tentative signs of progress in negotiations between the European commission and Italy’s populist leaders resulted in the key barometer of the Italian stock market rising by almost 3%. Continue reading...
Carlos Ghosn ousted as Mitsubishi chairman; Draghi warns eurozone is slowing - as it happened
Mitsubishi has followed Nissan’s lead, and voted to remove Carlos Ghosn from chairmanship after allegations of financial wrongdoing
Theresa May's Brexit deal could cost UK £100bn over a decade
People’s Vote-commissioned study says loss is equivalent to annual output of WalesTheresa May’s Brexit deal is expected to cost the UK economy as much as £100bn over the next decade compared with remaining in the EU, according to one of the country’s leading economic thinktanks.An analysis of the prime minister’s EU withdrawal agreement from the National Institute of Economic and Social Research suggested that by 2030, Britain would lose GDP growth equivalent to the annual economic output of Wales. Continue reading...
UK has weakest wage growth in advanced G20 nations, says ILO
Britain ranks bottom in group of nine wealthy countries for pay performance since 2009Workers in Britain have had the weakest real wage growth among the most advanced nations in the G20, according to UN data showing the scale of the UK’s “lost decade” for pay.According to the International Labour Organization, Britain ranked bottom of a group of nine wealthy nations for its pay performance since 2009, after the financial crisis. Continue reading...
Does setting inflation targets cloud our view of the economy? | Robert Shiller
They aim to promote stability, but might actually increase uncertainty about real things like home values or investmentsIn many countries, inflation has become so low and stable in recent decades that it appears to have faded into the woodwork. Whereas galloping inflation was once widely viewed as the number one economic problem, today most people – at least in the developed countries – hardly ever talk about it or even pay attention to it. But “silent inflation” still has subtle effects on our judgment, and it may still lead to some consequential mistakes.Since New Zealand’s central bank set the first example in 1989, monetary authorities around the world have increasingly pursued a policy of setting inflation targets (or target ranges) that are substantially above zero. That is, policymakers plan to have inflation, but steady inflation. What used to be a dirty word is now announced publicly, and moderation is enforced.Related: UK inflation steady at 2.4% in October after food price war Continue reading...
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