Brexit uncertainty ‘finally taking toll’ as pay rises slow and unemployment increasesThe number of people in work fell by the largest margin in four years in August as the uncertainty created by the Brexit talks weakened Britain’s previously robust labour market.The employment figures dropped by 56,000 in the three months to the end of August from the previous quarter after a shake-out of high street retail jobs and redundancies across much of the manufacturing sector.The International Labour Organisation (ILO) jobless rate is a measure of unemployment adopted in a number of countries to reflect the state of the labour market. It is expressed in percentage terms, as a proportion of working-age people who are out of work but want a job and are actively looking for one. Continue reading...

His bold new plan is even more radical than the Labour party’s. It would transform how companies operate and for whomOligarchy rules the United States: the republic has been ransacked, its commonwealth privatised, and rentierism runs amok. The richest 10% of Americans capture an estimated 97% of all capital income – including capital gains, corporate dividends and interest payments. Since the financial crisis of 2008, almost half of all new income generated in the US has gone to the top 1%. The three wealthiest people in the US now own more wealth than the bottom 160 million Americans. And the richest family in America – the Walton family, which inherited about half of Walmart’s stock – owns more wealth than the bottom 42% of the American people.Related: The pundit class continues to misunderstand Bernie Sanders – and it shows | Nathan RobinsonRelated: Trump's mounting troubles in Iowa could spell doom for Republicans | Art Cullen Continue reading...

Dr Kevin Bannon on the root of the Caribbean country’s problems and why the US demeans the politician who became Haiti’s first democratically elected presidentHaiti’s political and economic problems are of course rooted in its exploitative treatment by the US going back decades and more (How US aid failed Haiti, The long read, 11 October). However, since 1990, in both elections and in huge popular demonstrations, Haitians have expressed their desire to be led by Jean-Bertrand Aristide – a sensible, conscientious humanitarian, and democratic reformer and a supporter of the liberation theology movement. He has been overthrown as leader and exiled twice by pro-US local elites because the US fears his influence might initiate a regional domino effect; this explains why Aristide continues to be demeaned by conservative sources in the US. Jacob Kushner’s article attributes Haiti’s woes more prominently to the philanthropy of Bill and Hilary Clinton than even the country’s disastrous 2010 earthquake. More remarkably, the article is without a single mention of Jean-Bertrand Aristide.

Abhijit Banerjee, Esther Duflo, Michael Kremer ‘dramatically improved’ practical solutionsAcademics who pioneered on-the-ground experiments to discover the most effective ways to tackle poverty in the developing world have been awarded this year’s Nobel prize for economics.Abhijit Banerjee and Esther Duflo, of the Massachusetts Institute of Technology, secured the 9m Swedish krona (£720,000) prize with the Harvard professor Michael Kremer on Monday.Related: Nobel Prize in Economics won by Banerjee, Duflo and Kremer for fighting poverty - live updates Continue reading...

Esther Duflo becomes second woman to win the Sveriges Riksbank Prize in Economic Sciences, with Abhijit Banerjee and Michael Kremer also recognised for their research alleviating poverty

Party says calculation of renationalisation costs is ‘incoherent scaremongering’Labour’s plans for a sweeping renationalisation of utilities would cost Britain almost £200bn, the Confederation of British Industry has said.Branding the plans as “eye-watering”, the nation’s foremost business lobby group, which represents some companies that would be put into state ownership under a Labour government, said the project would add to the UK’s debt levels and could come with costs to pensioners and savers. Continue reading...

Financial Stability Board says countries should be prepared for global economic downturnGlobal authorities gathering in Washington this week must stand ready to address emerging risks including a global economic downturn and Brexit, the leading body for global financial stability has warned.The Financial Stability Board – which was formed after the 2008 banking crisis that brought the financial system to its knees – said that while much has been achieved in the past decade, its job was “far from complete”. It also warned of new dangers, including higher levels of corporate debt, weaker lending standards, and cyber-attacks. Continue reading...

Ariel Rubinstein, who says economics lacks common sense, heads list of likely winners

According to our study, the deal now being discussed would reduce per capita GDP by 6.4%, as opposed to 4.9%Back to the (original) backstop? By conceding that any customs border will have to be in the Irish Sea, Boris Johnson appears to have revived the possibility of a Brexit deal. But the focus on the politics of the Irish border risks missing the implications of his proposals for the economy of the UK as a whole. And, as we reveal in our report for The UK in a Changing Europe, these are significantly worse than was the case for Theresa May’s Brexit plan.Indeed, Johnson’s motivations for ditching May’s withdrawal agreement have little if anything to do with Northern Ireland. Rather, it is because the new prime minister sees the ultimate relationship the UK should have with the EU very differently to his predecessor. Gone is the notion that a shared customs territory and close regulatory alignment on goods should form a “bridge” to the long-term relationship. As Johnson put it himself in his letter to Jean-Claude Juncker: “The backstop acted as a bridge to a proposed future relationship with the EU in which the UK could be closely integrated with the EU customs arrangements and would align with EU law in many areas. That proposed future relationship is not the goal of the current UK government. The government intends that the future relationship should be based on a free trade agreement in which the UK takes control of its own regulatory affairs and trade policy.”Relative to the status quo and May’s proposals, the economic impact of these proposals would be significant and negativeRelated: 'Two borders for four years': what is Boris Johnson's Brexit offer? Continue reading...

Bank of England governor warns of financial collapse linked to climate emergency

The state of the global economy is particularly worrying because the usual explanations do not applyGrowth is the default setting for modern economies. Humans innovate and improve, find better ways of doing things. Only when shocks occur is this process of steady advance interrupted.One of the long-established adages in financial markets is that business cycles never die of old age, and there is plenty of historical evidence to support that view. Continue reading...

Economists and manufacturers warn recovery will be long delayed despite any deal prime minister may be working onBritain’s economy will take years to recover from the uncertainty that has seen companies abandon investment plans and move headquarters abroad, economists warned this weekend.Dashing hopes that a deal with the EU would mean a new start for business, economists said weak global growth and employers shifting from the UK could see recovery delayed until well into the next decade. Continue reading...

In the fog of Brexit uncertainty, UK GDP growth has been undermined by lack of business investmentOne of the confusing trends since the Brexit referendum vote can be found in the official measure of national income or GDP. A glance at the data since 2016 reveals a series of ups and downs from quarter to quarter, and very little in the way of a trend.The low points conform to the argument that Brexit was a disaster for the economy, while the mini-recoveries play to the Brexiters’ charge that “project fear” amounted to no more than a childish scare tactic. This year has proved to be little different. Stockpiling by businesses before the first Brexit deadline in March boosted the first-quarter GDP number before a slump in the second quarter.When a country can count on about 1 million more people every four years, it is almost impossible for GDP not to rise Continue reading...

Trade wars are likely to dominate discussions in Washington despite new leader’s passion on inequality and climate crisisThe world’s finance ministers and central bankers will be in Washington this week for the annual meetings of the International Monetary Fund and World Bank amid growing concerns that the global economy is heading towards stagnation.Predictions of a sharp downturn fill policymakers with anxiety, knowing that job losses and lower tax revenues can only lead to social unrest. Last week the IMF’s new leader, Kristalina Georgieva, asked nations involved in tit-for-tat trade wars if they dare ignore warnings of the most serious threat to the global economy since the financial crisis.Related: Nations must unite to halt global economic slowdown, says new IMF headRelated: IMF accused of 'reckless lending' to debt-troubled states Continue reading...

Sterling hits a three-month high against the dollar and UK company shares rocket

Sharpest rise in sterling’s value since EU referendum follows Boris Johnson-Leo Varadkar meetingThe pound had its biggest two-day rally against the dollar since the Brexit vote as hopes rose that a deal could be struck before the deadline later this month.Sterling climbed to the highest level in three months against the US currency, briefly hitting $1.27, amid mounting optimism in the City, after the EU’s chief negotiator, Michel Barnier, said talks could progress to the next phase. Continue reading...

Vice-president was pressed on Trump-Zelenskiy transcript after urging residents to ‘turn up the heat’ on Democrats to pass USMCAMike Pence visited Iowa this week to pitch the Trump administration’s USMCA trade deal and ask Iowans to “turn up the heat” on their Democratic representatives in Congress to pass the legislation designed to replace Nafta.Speaking to a crowd of more than 500 supporters at Manning Farms in Waukee, a suburb of the capital, Des Moines, the vice-president had come to Iowa to push the deal, which was agreed in November 2018 between the US, Mexico and Canada but has yet to be passed by Congress.Related: Trump-Ukraine impeachment scandal: timeline of key events Continue reading...

Growth is weak but strong summer for services and a TV-film industry boom lifts quarterly figuresBritain is on track to avoid a recession despite mounting Brexit uncertainty after official figures showed an unexpectedly strong jump in economic growth over the summer.The Office for National Statistics said gross domestic product had risen by 0.3% in the three months to the end of August, beating the forecasts of City economists, helped by the strength of the services sector and a boom in TV and film production across the country.Gross domestic product (GDP) measures the total value of activity in the economy over a given period of time. Continue reading...

The latest UK GDP report shows that the economy will probably avoid sliding into recession this autumn

Readers respond to the launch of the NHS Every Mind Matters campaign and share their thoughts on other mental health issuesCongratulations to Suzanne Moore for highlighting those who are forgotten in campaigns such as Every Mind Matters (Telling people to jog will not solve this mental health crisis, 8 October). When Jeremy Hunt spoke of the biggest expansion of mental health services in Europe, he referred to expanded provision for people with mild to moderate problems. Those with serious mental heath problems have found that there is no therapy for them, specialist services like assertive outreach have disappeared, and their community mental health teams are too busy managing crises to support them.I work with people who regularly self-harm and feel suicidal. Because the NHS has a tendency to keep them out of services and ignore NICE guidelines aimed at helping them, they find themselves the subjects of reports such as “No Longer A Diagnosis of Exclusion” and “The Patients Psychiatrists Dislike”. As they are turned away while seeking help and reading “If you feel that life is not worth living, you’re harming yourself or have thought about self-harm, it’s important to tell someone” on the Every Mind Matters website they will rightly feel gaslighted. We are building awareness of difficulties for which there is no help. We are encouraging people to talk while leaving them alone. Despite this, the insult of being manipulative and deceitful is thrown at the people wanting help, not those who promise the earth but whose words are dust. It’s clear that some minds don’t matter as much as others.

Rolling coverage of the latest economic and financial news, as hopes of a trade war breakthrough this week grip markets

Multinationals would be forced to pay more tax in countries where they make biggest salesLarge internet companies would be forced to pay more tax in countries where they sell products and services under proposals for a global shake-up of taxation rules that currently allow companies to shift profits to low-tax locations.The Organisation for Economic Co-operation and Development wants to upgrade the international tax system for the 21st century and make multinationals such as Facebook, Amazon and Google pay more corporate tax in the countries in which they generate their biggest sales. Continue reading...

Bank of England governor gives firms two years to agree rules for reporting climate risksThe governor of the Bank of England has warned major corporations that they have two years to agree rules for reporting climate risks before global regulators devise their own and make them compulsory.Mark Carney said companies should use their next two annual financial reports to road test how they document the impact of the climate emergency on their businesses. Continue reading...

PageGroup and Robert Walters also point to uncertainty created by Hong Kong protestsTwo of Britain’s biggest recruitment companies have warned that uncertainty created by Brexit, protests in Hong Kong and the US-China trade dispute will hit their profits this year.PageGroup, the UK’s second-largest recruiter, said rising fears about Brexit had made companies less willing to hire workers and potential candidates wary about moving jobs. It said uncertainty had affected the market for jobs at all levels. Continue reading...

In her first speech, Kristalina Georgieva says looming crisis requires coordinated responseThe new head of the International Monetary Fund has told squabbling nations to forget their differences and prepare a united response to the most serious threat to the global economy since the financial crisis a decade ago.In her first speech since becoming the IMF’s managing director, Kristalina Georgieva said the world was in a synchronised slowdown and needed a synchronised response.Related: No-deal Brexit would 'push national debt to levels last seen in 60s' Continue reading...

Boris Johnson claims issue is a priority but Labour says figures are a ‘damning indictment’The productivity of British workers fell at the fastest pace for five years in the second quarter of 2019, amid mounting concerns over the impact of Brexit uncertainty on the economy.The Office for National Statistics said labour productivity – a measure of economic output per hour of work – slumped by 0.5% in the three months to June compared with the same period a year ago, the worst performance since mid-2014. Continue reading...

IFS says public borrowing will more than double next year whatever the Brexit resultEmergency tax cuts and higher public spending to offset the impact of a no-deal Brexit would send government debt to its highest level in more than half a century, according to Britain’s leading experts on the public finances.The Institute for Fiscal Studies (IFS) said the scale of the government response required to firefight a flatlining economy in the event of a disorderly departure from the EU would come with a hefty price tag for the public purse.The government is now adrift without any effective fiscal anchor Continue reading...

Rolling coverage of the latest economic and financial news, as UK retailers suffer their worst September since at least 1995

Multinationals’ failure to pay is hitting governments’ ability to fight the climate crisis and inequalityGlobalisation has gotten a bad rap in recent years, and often for good reason. But some critics, not least Donald Trump, place the blame in the wrong place, conjuring up a false image in which Europe, China, and developing countries have snookered America’s trade negotiators into bad deals, leading to Americans’ current woes. It’s an absurd claim: after all, it was America – or, rather, corporate America – that wrote the rules of globalisation in the first place.That said, one particularly toxic aspect of globalisation has not received the attention it deserves: corporate tax avoidance. Multinationals can all too easily relocate their headquarters and production to whatever jurisdiction levies the lowest taxes. And in some cases, they need not even move their business activities, because they can merely alter how they “book” their income on paper.Related: Will London's post-Brexit future be as gloomy as predicted? Continue reading...

Jubilee Debt Campaign says the Fund broke its own rules by not ensuring sustainable debt burdenDebt campaigners have accused the International Monetary Fund of encouraging reckless lending by extending $93bn (£75bn) of loans to 18 financially troubled countries without a debt restructuring programme first.In advance of the IMF’s annual meeting in Washington next week, the Jubilee Debt Campaign (JDC) said the the Fund was breaking its own rules by providing financial support without ensuring that the debt burden was sustainable. Continue reading...

Tax Justice Network says poor countries could lose out under proposals to limit avoidanceProposed reforms of international tax rules by the Organisation for Economic Co-operation and Development will only claw back 5% of profits, and could end up worsening global inequality, analysis by tax campaigners has found.A study by the Tax Justice Network found that the OECD proposals, designed to limit the scope of multinationals to avoid tax, could end up shrinking the tax paid in poorer countries. Continue reading...

The reshaping of the railways left deep scars, with towns and villages isolated, and London all-importantThere are expert government reports that quickly gather dust. There are reports that seem as if they will make a difference but are quietly forgotten about. There are reports that actually matter. And then there’s Beeching.Even now, 56 years after its release, you don’t need to be a transport buff to know about the Beeching report. Following its publication in March 1963, hundreds of stations and thousands of miles of track were axed. The rail network was slimmed down on the grounds that many lines were underused and uneconomic.Related: Rail services lost under 1960s Beeching cuts may reopenRelated: Left in a siding: the rail link that could make Heathrow greenerRelated: Brewing in the Borders: businesses thriving on Scotland's new railway line Continue reading...

The only tool he has to placate US consumers is successive interest rate cuts – but the whole world is playing at that gameDonald Trump’s cunning plan to make America great again by launching a trade war with China has officially backfired. Last week, a keenly watched measure of US manufacturing showed firms cutting back on production and jobs at a rate not seen since 2009. Recession warning lights are flashing and the outlook seems a world away from the cheery one presented by the president when he entered the White House in 2017.It is quite something for a president to impose a trade policy that weighs heavily on parts of a crucial sector for the US economy – and it’s a bizarre tactic given that the votes of manufacturing workers delivered him his first term in office.The UK would now be around £40bn richer if the referendum had never taken place Continue reading...

There is no need to ‘honour the referendum’ when it conflicts with our greater duty to honour Britain’s national interestIt is a great tribute to the supreme court that it called Boris Johnson’s bluff when he tried to prorogue parliament (with the emphasis on “rogue”). Lord Pannick QC, who triumphed in the case brought by the patriotic hero Gina Miller, recalls that he was on safari, watching wild animals in Botswana, when he heard what “wild political animals” were up to in London.“How ironic,” says Pannick, “that the case arose in the context of Brexit, a political policy that its supporters justify by the wish to return sovereignty to parliament and to make our supreme court supreme over the European court of justice.”Apparently none other an authority than Dominic Cummings has conceded that “there is a strong democratic case” for a second referendum Continue reading...

Graham Sowter takes issue with a recent letter by Tim Worstall of the Adam Smith Institute that cited data suggesting that income inequality has decreased slightly in the UK in the last decadeThere are lies, damned lies and Gini index statistics. A single statistical measure invented in 1912 cannot hope to capture the nature of inequality in an entire country in 2019. Tim Worstall of the Adam Smith Institute (Letters, 2 October) is careful to refer to income inequality, as do the Tory politicians who often make the same claim, but accumulated wealth is now a very important component of inequality: 10% of the population own over 45% of total wealth.There are separate Gini indices for property wealth, financial wealth and private pension wealth, also published by the Office for National Statistics, that all have much higher values than the index for income. Effective disposable incomes are also crucial; if you are spending 30%-50% of your post-tax income on rent, you are not as rich as the Gini index says you are. Rents now represent a significant transfer of money from the poor to the rich. Continue reading...

Just like after 1945, a new dawn of international bodies is required – this time to protect and empower the global southHuman civilisation is facing a crisis on a scale that we have not seen since the second world war. We must finally respond in a way that meets this immense challenge.The climate crisis is of our own creation, particularly that of the richest countries whose development has been based on exploiting natural resources without end. The casualties are piling up – some countries and entire communities, in particular island nations, are the most exposed and least prepared: after Hurricane Dorian, we have all seen the devastation in the Bahamas.The World Bank, the IMF and the UN have ultimately exacerbated the climate crisisRelated: As the climate collapses, we can either stand together – or perish alone | Tim Hollo Continue reading...

Rolling coverage of business, economics and markets as investors focus on chances of Federal Reserve interest rate cuts

The feared large-scale exodus of firms and financiers does not seem to be under wayIt is now well over three years since the UK voted, by a narrow but significant margin, to leave the EU. Yet we still have no idea what kind of economic relationship the UK will have with the 27 countries it leaves behind. (Some of the debate in London recalls in its insularity the apocryphal 1930s headline: “Fog in Channel: continent cut off.”) Insofar as one can hazard a guess, the most likely outcome seems to be a more remote relationship than leave supporters talked about in the referendum campaign and than most commentators envisaged shortly after the vote.But despite that change of direction, and the certain loss of the so-called passport, which would allow financial services to be sold freely across the EU, the feared large-scale exodus of firms and financiers from London does not seem to be under way. The French bakeries and German sausage shops are still doing a roaring trade. Why?Related: Anxiety running high about London's future as a financial centre | Barry EichengreenRelated: The future of the global economy hinges on four games of chicken | Nouriel Roubini Continue reading...

The Bank rate is already low and Brexit overshadows everything, but look elsewhere too – the global economy is not in good healthCall it a full house of poor economic news. The services sector is contracting, according to the purchasing managers’ index, joining the manufacturing and construction industries in negative territory. In big picture terms, there are no bright spots.The official data, which measures actual economic activity as opposed to managers’ view of prospects, may yet reveal growth in the July to September quarter. But you would have to be a supreme optimistic to believe the figure will be greater than 0.3% – and even that outcome would represent a feeble bounce from decline in the second quarter. Continue reading...

The fiscal irresponsibility of Greece was not the cause of the 2010 crisis, write Prof Philip Arestis and Dr Yiannis Kitromilides, while Prof Mary Mellor argues for greater state spendingProfessor Jeffrey Frankel (Why Germany must not make the same fiscal mistakes as the US, 1 October) claims that “the 2010 euro crisis would not have happened had Greece, after joining the euro, maintained the fiscal discipline called for under the stability and growth pact”. This narrative of the eurozone crisis is very familiar but also very misleading. If fiscal indiscipline by Greece was the cause of the eurozone crisis in 2010, why, at the same time, did the fiscally prudent governments of Ireland, Spain and Portugal find themselves in the same sinking boat as Greece, in need of international rescue? The fiscal irresponsibility of Greece caused the bankruptcy of Greece, but the 2010 eurozone crisis was caused primarily by misbehaviour and indiscipline in the private sectors of the economies of the eurozone periphery. Professor Frankel’s sympathy for “Germans’ much-maligned attitude toward debts and deficits” is misplaced. The German attitude to – some would say obsession with – fiscal discipline and balanced budgets was certainly not sufficient to prevent the eurozone crisis. A strong case can be made that this attitude is also not necessary.

Surprise contraction comes amid sliding sales, higher costs, job losses and disruptive BrexitBritain has edged closer to its first recession since the financial crisis after the country’s dominant service sector unexpectedly plunged into contraction last month, in a sign of the mounting stress facing the economy as Brexit looms.According to IHS Markit and the Chartered Institute of Procurement and Supply (Cips), activity in the sector fell as companies reported sliding sales, job losses, cancelled and postponed projects and weak investment levels.One of the two main definitions of recession in the UK is at least two quarters of negative economic growth. Judged by this yardstick, the UK was last in recession in 2008-09, when there were six consecutive quarters of negative growth. Continue reading...

The IMF alone cannot help troubled states out of a financial hole. Such states need more aid, not more loansIn case you blinked, the Argentine government built up a pile of debt out of almost nothing with surprising speed, and then proceeded to default on it almost as quickly. Compared to the country’s slow-motion 2002 default, the latest crisis feels like 60-second Shakespeare. But in both cases, default was inevitable because the country’s mix of debt, deficits and monetary policy was unsustainable, and the political class was unable to make the necessary adjustments in time.In both cases, loans from the International Monetary Fund seemed only to postpone the inevitable, and, worse, to exacerbate the ultimate collapse. So after the second debacle in Argentina in less than a generation, it’s high time to ask how to refocus the IMF’s mandate for dealing with emerging-market debt crises. How can the IMF be effective in helping countries regain access to private credit markets when any attempt to close unsustainable budget deficits is labelled austerity? The only answer is to increase substantially the resources of international aid agencies (the IMF is a lender). Unfortunately, there seems little appetite for that.Related: Argentina's economic crisis is the result of avoidable mistakesRelated: Are debt crises in Argentina and Turkey a global warning sign? Continue reading...

Stocks drop in Sydney and Tokyo mirroring falls in US and UK, as Washington slaps 25% tariffs on range of European goodsAsian markets have tanked after a below-par US jobs report compounded worries about the world’s top economy, while Washington opened up another front in its trade wars by imposing swingeing tariffs on European goods, including Scotch whisky and French wine.Stocks fell sharply in Tokyo, Sydney and Seoul on Thursday as investors reacted to the surprise new tariffs and also heavy losses in Europe and on Wall Street on Wednesday.Related: Scotch whisky and French wine hit by $7.5bn US tariffs Continue reading...

The 25% levies also include British knitwear and EU cheese and aircraft as White House retaliates for subsidies given to AirbusThe US is set to impose $7.5bn (£6.1bn) of tariffs on exports from the EU including scotch whisky, French wine and cheese and aircraft in retaliation for subsidies given to the aerospace group Airbus after a World Trade Organization (WTO) ruling.Related: Airbus on course to overtake Boeing as biggest planemaker Continue reading...

The number of homeless people dying on our streets is soaring. We have the power to stop thisEven the bald numbers are horrifying. This week, the Office for National Statistics recorded that 726 homeless people died in England and Wales in 2018, a rise of 22% on 2017 and the biggest year-on-year rise since it began collecting data. And they died shockingly early. On the streets, a man can expect to die at about 45 years old, even while the average man will live until 76. For a woman sleeping rough, life expectancy is lower still at 43, while her counterpart in the wider population can expect to live until 81. In one of the richest societies in human history, we still allow people to die decades too soon for want of a secure roof over their heads.A statistic, a tent on the street, a man holding up a scrap of cardboard: homeless people often die as they live, in anonymity amid general indifference. Even our data on the number of people living without a secure home are worryingly sketchy. The housing charity Shelter estimates that at least 320,000 people in Britain sleep rough or in temporary accommodation but warns that figure is likely to be an underestimate as it misses out sofa-surfers and those bedding down in sheds or cars. In an attempt to reveal the humanity behind those numbers, to interrogate the stories buried amid the statistics, the Guardian has launched a series, The Empty Doorway, recounting some of the lives of those who died homeless. Only a few weeks in, it has already uncovered some shocking themes, which demand to be tackled if we are to bring down the homeless death toll. There was the story of talented rapper Jake Humm, living in supported accommodation provided by a local YMCA. Staff there knew he was a suicide risk yet left him alone for at least two days before he killed himself. He was just 22. The YMCA’s internal review of the case, it told our reporters, concluded “there were no errors or omissions in the service we provided”. While mindful of the constraints on staff, financial and otherwise, the goals for the service need to be improved and self-regulation must be supplemented by an independent watchdog. Continue reading...

Manufacturers react to surveys showing declining orders by slashing production and jobsStrong signals that a slowdown in global manufacturing intensified in September sent stock markets tumbling on Wednesday, as leading indices in Europe and the US retreated.In London the FTSE 100 rolled back all the gains made since mid-August as it dropped 237 points to 7,122, falling 3.2% in its biggest one-day fall since 2016. Extending the losses overnight on Asian markets, shares on continental European markets also experienced losses with the Paris CAC falling 3.1% to 5,422. The Dow Jones index in New York compounded its decline on Tuesday by falling close to 500 points on Wednesday, or 1.86%. Continue reading...

The nationalism that taps into people’s angst and dislocation can be effectively challenged with a bazooka of a eurozone budgetLast month Germany’s version of the Sun, Bild, ran a sensationalist attack on the outgoing president of the European Central Bank, Mario Draghi. Depicting the central banker as “Count Draghila”, replete with vampirish teeth and velvet collar, the article portrayed the ECB boss as a fiend sucking the bank accounts of German savers dry of billions of euros with low interest rates. A day later the tabloid interviewed the head of the German central bank to ram the message home under the headline “Is our money in danger?”. There is an undoubted perception across Europe’s largest economy that the ECB was penalising savers through easy money policies that have given populists a stick to beat mainstream politicians with. However, the release of the latest economic data shows that Mr Draghi was right and German sentiment was wrong.It is increasingly clear the risk of recession in Europe is rising. Growth is sputtering while inflation is falling. The eurozone manufacturing sector suffered its worst month in seven years while inflation dropped to a three-year low. Mr Draghi has for years attempted to resuscitate the eurozone’s sluggish economy through monetary means. Last month the ECB lowered interest rates further into negative territory and restarted the ECB programme of buying bonds. Yet as one economist perceptively put it, the problem for the eurozone is that “weak credit growth is driven by the lack of demand from creditworthy borrowers rather than the supply cost of finance”. This can be solved in part by governments stepping up to boost demand in the eurozone. Mr Draghi is right to say it is no longer tenable to claim that monetary policy alone can deal with the entrenched problems of the continental economy. Instead he correctly called for fiscal policy to become the main economic instrument to sustain demand in the eurozone. Continue reading...

Guardian readers discuss the Conservative party conference, and the party’s political legacy so farDescribing the chancellor’s speech as “hyperbole that crumbles under scrutiny” is a kind way of making clear that it was nothing more than a cynical jumble of half-baked, half-true assertions (This party split the country. A cash splurge can’t repair it, 1 October). We’ve grown used to – but shouldn’t accept – duplicity and hyperbole. Examples of misdirected but eye-catching spending include how the problems associated with social care, of quality, availability and cost, will not disappear as a result of a hospital-building programme. Communities cut off by swingeing cuts to public transport as a consequence of reductions in local authority funding that once used to subsidise such routes will not benefit from plans to upgrade roads – or the introduction of contactless payments on buses that don’t run.Of course low-paid workers will benefit from significant increases in the national minimum wage, but such gains will disappear under the weight of fast-rising food and fuel bills as quickly as they emerged.