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by Paul Mason on (#24ZVB)
Mark Carney is right that we must stop creating badly paid low-productivity jobs and redistribute wealth – and that will involve unleashing the machinesThe headlines were inevitable, once Mark Carney uttered the word automation. Robots, the Sun told us, are set to “steal 15m jobs from Britsâ€. Sadly, our main problem is not robots; still less the artificial intelligence technologies that will power them.Our real problem is symbolised by the car wash. A car wash used to mean a machine. Now it means five guys with rags. There are now 20,000 hand car washes in Britain, only a thousand of them regulated. By contrast, in the space of 10 years, the number of rollover car-wash machines has halved – from 9,000 to 4,200. The free-market economic model, combined with a globalised labour market, has produced a kind of reverse industrialisation. Continue reading...
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| Updated | 2025-11-08 01:15 |
by Graeme Wearden on (#24Y69)
Crude prices hit 17-month high as Opec and non-Opec members take steps to tackle worldwide oil glut
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by Patrick Collinson on (#25076)
Funding cuts, staff costs and rising need have spurred the government to consider increasing council taxThere is not a crisis in adult social care, says Nadra Ahmed, chair of the National Care Association. “We are now beyond the crisis point. We really are at the edge of the cliff now.â€Residential care homes are closing at an unprecedented rate, hospitals are logjammed with elderly patients with nowhere to go; in the community, local authority cuts are leaving more than a million people desperately in need of more assistance in their homes.Related: Council tax hike being considered to cover social care costs Continue reading...
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by Damian Carrington on (#24ZFK)
UN secretary general Ban Ki-moon welcomes new total revealing concern over coal, oil and gas investments has entered financial mainstreamThe value of investment funds committed to selling off fossil fuel assets has jumped to $5.2tn, doubling in just over a year.The new total, published on Monday, was welcomed by the UN secretary general, Ban Ki-moon, who said: “It’s clear the transition to a clean energy future is inevitable, beneficial and well underway, and that investors have a key role to play.â€Related: Institutions worth $2.6 trillion have now pulled investments out of fossil fuelsRelated: A beginner's guide to fossil fuel divestment Continue reading...
by Matthew Weaver and agencies on (#24YM8)
President says surprise move needed to stem profiteering, but critics lambast move as impractical amid inflation crisis
by Stephanie Kirchgaessner in Rome on (#24Y5D)
Italy’s third largest bank seeks to avoid government bailout with debt-for-equity swap offer to retail investorsExecutives at Monte dei Paschi di Siena (MPS) are fighting to salvage a multibillion-euro rescue by private investors in a frantic attempt to prop up the bank.In a statement released after a board meeting on Sunday, the world’s oldest bank said it would forge ahead with a debt-for-equity swap offer for tens of thousands of retail investors. The offer still requires regulatory approval. If MPS manages to convince investors to go along with the plan, it would help it avoid a government bailout by Italy, which would have far-reaching economic and political consequences.Related: Monte Dei Paschi bailout: what you need to know – the Guardian briefing Continue reading...
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by Katie Allen on (#24X55)
Inflation, cautious consumers and weak pound will be drag on output, says BCC, which puts 2017 GDP at 1.1%The UK economy will slow markedly next year as uncertainty about the country’s future position in Europe and higher inflation hit consumers and businesses, the British Chambers of Commerce (BCC) has predicted.The business group believes the UK will avoid recession but still lose momentum as the weak pound pushes up import costs and the resulting rise in inflation erodes people’s spending power. Continue reading...
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by Katie Allen on (#24X57)
Resolution Foundation links region’s growth, pay and income problems to pro-Brexit sentiment and policymakers favouring London and ManchesterThe West Midlands has become an employment blackspot and is badly trailing behind other parts of the UK on job creation and living standards, a leading think tank has warned.These considerations pushed the region into voting to leave the European Union, said the Resolution Foundation. Continue reading...
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by Letters on (#24WE0)
Pankaj Mishra’s exposé of the poverty of economic man (Welcome to the age of anger, 8 December) is powerful but, among the “more complex drives†he lists, he omits “belonging†– key to understanding “identity politicsâ€. Facing danger our instinct, like that of animals who herd, is to cling to the familiar and the group. Incomers may or may not be a realistic threat, but they are easily perceived to be in times of disturbing upheaval. This need not be a counsel of despair; it could be a cause for hope. Globalisation and technical change may not be inevitably destructive: whether they do harm or good depends on the values by which we handle them. If we remain dedicated to the competitive pursuit of material gain and are indifferent to the feelings of shame, humiliation, helplessness and anger of those who are left out – or if, worse still, we continue our persecution of the poor – then recent events are just a foretaste of a future that will be bleak indeed.
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by Gareth Thomas on (#24VG3)
Mutualising RBS would mean it could start serving those who bailed it out. And it would also inject some much-needed competition into the banking sectorEvery month there are new headlines about the Royal Bank of Scotland’s wrongdoing. The chief executive, Ross McEwan, puts the best spin on things, but his bank is still failing; most recently it failed the Bank of England’s stress test. Trying to privatise the bank hasn’t worked and state ownership hasn’t been a rip-roaring success either; but worse, its very size and dominance means together with the other big banks it is stifling competition. Now is the right moment for a different approach.Related: Turn RBS into a building society says Co-op party chiefIn strong mutuals it is member expectations rather than shareholder interests that ensure more competitive productsRelated: After eight hard years and a £52bn loss, can RBS ever be privatised? Continue reading...
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by Larry Elliott on (#24VC2)
John Maynard Keynes penned his General Theory in 1936. Faced with the upheaval of 2016, what would a cryogenically frozen Keynes do?Imagine this. In late 1936, shortly after the publication of his classic General Theory, John Maynard Keynes is cryogenically frozen so he can return 80 years later.Things were looking grim when Keynes went into cold storage. The Spanish civil war had just begun, Stalin’s purges were in full swing, and Hitler had flouted the Treaty of Versailles by remilitarising the Rhineland. The recovery from the Great Depression was fragile. It was the year of the Jarrow march and Franklin Roosevelt’s second presidential election victory.Related: John Maynard Keynes died 70 years ago. We ignore his wisdom at our peril | Justin Talbot Zorn and Merle LefkoffRelated: Keynes helped us through the crisis – but he's still out of favour Continue reading...
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by William Keegan on (#24TNK)
The process of leaving is descending into a farce that reminds one of The Fast Show – except that it is happening so excruciatingly slowlyThe Fast Show, which ran on BBC television from 1994 to 1997 – the last few years of Ken Clarke’s chancellorship – has been voted the second-best television sketch show ever, after Monty Python.What we are now witnessing is the Slow Show – this excruciating, drawn-out process of Brexit, which shows every sign of eventually proving the most dangerous and self-defeating political tragicomedy of our age. Continue reading...
by Vidhi Doshi in Panjim on (#24SY6)
With the state about to be a test bed for India’s drive to digital payments, alarm bells are ringing in the city of PanjimIt’s 11 o’clock, and Laxman Chauhan still hasn’t sold any fish. His stall in the central market in the west Indian city of Panjim has been open for three hours, but none of his usual clients have come today. He checks his watch, and then takes a walk to see if other vendors have had any customers. “Sold anything yet?†he asks Ramila Pujjar, who has set her stall up with a glistening display of the morning’s catch. She hasn’t either.“I’m losing 2,000-3,000 rupees (£23-£35) a day,†says Chauhan. “I’m throwing fish away every day.†Continue reading...
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by Toby Helm Political editor and Patrick Maguire on (#24SG9)
Tough choices must be made to safeguard economy, including scrapping of migration cuts, warns party’s former leaderThe UK should stay inside the EU’s single market and customs union even if this means there can only be limited cuts to immigration after Brexit, the former Labour leader, Ed Miliband, said.Spelling out his own Brexit strategy, and insisting that tough choices must now be made, Miliband argued that safeguarding the strength of the economy should be the number one priority in negotiations over leaving the EU, rather than a focus on the “undeliverable promise†of cutting immigration to tens of thousands a year.Related: Brexit must be fair to working people – or there will be a backlash |Ed MilibandRelated: Poll suggests public will not accept a Brexit that leaves them worse off Continue reading...
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by Jill Treanor and Stephanie Kirchgaessner in Rome on (#24P03)
Italian government may have to prop up world’s oldest bank as recapitalisation deal faltersFears that the Italian government will have to prop up Monte dei Paschi di Siena (MPS) are mounting after the European Central Bank refused to give the world’s oldest bank more time to find major investors to back a €5bn (£4.2bn) cash injection.Trading in the troubled bank’s shares was repeatedly halted on the Italian stock exchange on Friday. The MPS share price closed 10% lower as the bank’s board held a meeting that had already been scheduled before the reports that the ECB had rejected its calls for an extension to the deadline to bolster its financial position.Related: Monte Dei Paschi bailout: what you need to know – the Guardian briefing Continue reading...
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by Letters on (#24NYB)
After a week of intense scrutiny of Brexit arrangements, this Saturday’s observance of Human Rights Day provides a welcome pause to reflect on the role the UK should play on the international stage. This is especially important when we consider how global businesses based in the UK or listed on the London Stock Exchange impact on the world’s poorest people. There are real examples of UK leadership on human rights, from support for the UN’s Guiding Principles on Business and Human Rights to the Modern Slavery Act 2015. However, the government must follow through on its commitments and ensure that its leadership in these areas is not jeopardised by falling short elsewhere.Legal changes have made it harder for communities affected by British companies’ actions overseas to seek justice in the UK. It is also concerning that some government departments have regarded international standards as optional, rather than essential protections to ensure that business operations do not harm society’s most vulnerable. Continue reading...
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by Jill Treanor on (#24P04)
Why has the EU given the world’s oldest bank a deadline, how much money needs to be raised, and what impact is the Italian referendum having?The Italian banking system now poses the biggest risk to the financial security of the eurozone and its most venerable institution is at the heart of the problem. Here is what you need to know.Related: Crisis-hit Monte dei Paschi bank refused ECB help Continue reading...
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by Angela Monaghan (until 1pm) and Nick Fletcher on (#24KTB)
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by Jonathan Watts in Rio de Janeiro on (#24N73)
Senior official says proposed budget cuts, which have been protested in violent street clashes, are ‘lacking in all nuance and compassion’Brazil is poised to implement the most socially regressive austerity package in the world, a senior United Nations official has warned.Despite violent street protests against budget cuts, President Michel Temer – who came to power after engineering the impeachment of his former running mate, Dilma Rousseff – is pushing through a 20-year social spending freeze that will be locked into the constitution.Related: Brazil turns right as old elite wastes no time erasing Workers' party influenceRelated: Brazil is in crisis. And once again, the poorest will bear the burden | Mariana Prandini Assis Continue reading...
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by Arthur Neslen in Brussels on (#24MM2)
EU emissions pledge could be undermined by bank’s investments in oil, gas and auto industries, new analysis showsThe European Central Bank’s (ECB) quantitative easing programme is systematically investing billions of euros in the oil, gas and auto industries, according to a new analysis.The ECB has already purchased €46bn (£39bn) of corporate bonds since last June in a bid to boost flagging eurozone growth rates, a figure that some analysts expect to rise to €125bn by next September. On Thursday the bank said it would extend the scheme until 2018. Continue reading...
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by Katie Allen on (#24MJM)
New ONS tool allows workers to see the disparity in pay on a job-by-job basis – from fishmongers to fitness instructors, cleaners to cooksIf you are a female traffic warden or probation officer read on for good news. If you are a female chief executive you may want to look away now.The UK’s stubbornly wide gender pay gap is well-known. Almost half a century on from the gender pay act, there is still an 18.1% difference in average pay between men and women. Of course, such average figures for all employees tell a narrow story. They don’t, for example, account for the fact more women work in lower-paid jobs or sectors.
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by Katie Allen on (#24M9F)
Rise in exports in October fuels hopes economy will end year strongly – but construction output suffers surprise fallNews of a pick-up in exports has fanned hopes the UK economy will finish the year on a strong note, confounding earlier fears that the Brexit vote would spark a sharp slowdown.Official figures showed the UK’s trade deficit with the rest of the world narrowed more than expected in October as exports rose and imports fell. But statisticians said there was little evidence that the weak pound – which makes UK goods cheaper overseas – was boosting exports.Related: Protectionism and trade disputes threaten world growth, says OECD Continue reading...
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by Frances Perraudin North of England reporter on (#24JPE)
Brexit vote is cry of community outrage at imbalances of wealth and power, warns IPPR NorthEstablishment figures should stop sneering at northern England’s Brexit voters and instead work to understand their concerns, a leading thinktank will warn on Friday.Speaking at its annual State of the North conference in Leeds, the director of the Institute for Public Policy Research (IPPR) North, Ed Cox, will argue that Brexit negotiations should focus on the needs of the areas that voted most strongly to leave the EU. Continue reading...
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by Sarah Butler on (#24HKE)
Food and drink industry flags up labour shortages as EU workers leave after Brexit vote or stay away due to fall in poundFood prices will rise unless the government ensures EU citizens can work in the UK after Brexit, according to industry groups representing the major supermarkets and food manufacturers, including the owner of Marmite.Related: EU workers in food and drink industry need assurance over Brexit | Letters Continue reading...
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by Letters on (#24HFB)
Nearly 4 million people are employed in growing, harvesting, producing, packaging, selling and serving our food and drink.In light of the vote for Brexit, the importance of food and drink to our nation’s economic and physical wellbeing should be recognised and its future secured. In recent years, Britain has enjoyed access to a wider range of safe, high-quality food and drink, at every price point, than ever before. At a time when household incomes are under increasing pressure, shop prices for food have been kept in check for more than three years and, if that is to continue, the government must ensure the place of food and drink both in our new industrial strategy and at the heart of the Brexit negotiations. Continue reading...
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by Katie Allen on (#24GGS)
Eurozone’s central bank leaves interest rates unchanged but slows pace of asset purchases from €80bn a month to €60bnThe European Central Bank has vowed to continue with its programme of electronic money printing to shore up the eurozone recovery but surprised financial markets by reducing the amount of stimulus it expects to provide each month.The single currency bloc’s central bank left interest rates unchanged and said it would continue its programme of quantitative easing (QE) to next December or beyond “if necessaryâ€, marking an extension to its previous guidance that the scheme would run until the end of March. Continue reading...
by Graeme Wearden on (#24FET)
European Central Bank says it will conduct an extra nine months of quantitative easing, but cuts bond purchases from €80bn to €60bn per month
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by Katharine Murphy, Greg Jericho, Gareth Hutchens an on (#24ET9)
Greg Jericho, Katharine Murphy, Gareth Hutchens and the West Australian’s economics editor, Shane Wright, look back at the year in economics on this episode of Australian politics live. When the election promised jobs and growth, why do we now have less of both? Continue reading...
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by Gareth Hutchens on (#24E95)
Treasurer says he would prefer policy changes were accepted before economic emergency, but Labor blames shrinking growth on Coalition’s lack of strategyScott Morrison says he does not want to wait for a recession to convince parliament of the need for his company tax cuts.He has referred to Paul Keating’s infamous phrase from 1990 about the “recession we had to haveâ€, saying he would prefer important policy changes were accepted before an emergency.Related: Australian GDP: economy shrinks by 0.5% in September quarterRelated: Coalition policy has gone badly wrong and the RBA needs to cut interest rates | Stephen Koukoulas Continue reading...
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by Letters on (#24DEH)
Colin Hines of the Green New Deal Group on job-creating QE | James Taylor of Scope on disabled people in poverty | Dr Malcolm Torry of the Citizen’s Income Trust on a basic income | Anita Deshmukh on older women’s unemploymentMark Carney can himself do far more to bring about his desire for the rebalancing of the economy to help the “left behind†(Globalisation victims must now get a share of the gains, warns Carney, 6 December). In August the Bank of England announced a further £60bn of its quantitative easing programme, taking the total of e-printed money to £435bn, the equivalent of nearly £7,000 for every man, woman and child in the country.Instead of using this staggering amount of money to prop up the banks and inflate stock markets, property and other assets, the new £60bn of QE should be used to buy bonds from a national investment bank and from local authorities to generate a “jobs in every constituency†programme. This would give all people, not just the left behind, a sense of hope about their economic future and should involve decentralised infrastructure projects centred on a decades-long, multi-skilled programme of energy refits of all the nation’s 30 million dwellings, a shift to localised renewable energy, and a rebuilding of local transport, food and flood defence systems. Continue reading...
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by Larry Elliott on (#24CKT)
Northern Europe dominates Indigo Index of countries likely to thrive by harnessing innovation and human capitalBritain’s strength in the digital economy means it is one of the countries best placed to take advantage of the shift away from capital-intensive industry, according to an international survey of more than 150 countries.A study looking at the nations that would thrive in coming decades was dominated by Scandinavian countries. However, the UK was ranked as the highest-placed member of the G8 leading industrial countries, in fifth position.Related: Leaving the EU mustn’t mean crashing the digital economy | Wendy Tan White Continue reading...
by Julia Unwin on (#24CDG)
Seismic shifts in the labour market have fuelled mistrust and insecurity, and left far too many ‘just about managing’ families teetering on the brink of disasterThree striking trends stand out from the annual state-of-the-nation report Monitoring Poverty and Social Exclusion, commissioned by the Joseph Rowntree Foundation (JRF). First, the inexorable rise of in-work poverty. A total of 7.4 million people are in poverty, despite being in a working family – a figure that has risen by one million over the last decade. This is despite record employment and the growth of full-time work. One in every eight workers in the UK is now living in poverty and 55% of people in poverty are in working households – a record high.Related: Study finds 7m Britons in poverty despite being from working families Continue reading...
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by Alan Travis Home affairs editor on (#24C1G)
NIESR thinktank says hard Brexit would reduce annual GDP per head while giving only a ‘modest boost’ to wages of low paidA major cut in immigration from the European Union to Britain after Brexit would produce a damaging long-term hit to future economic growth while yielding only a “modest boost†of under 1% to the wages of low-paid workers, new research has found.The study by the National Institute of Economic and Social Research (NIESR) thinktank says a “middle range†Brexit where EU immigration falls by as much as 91,000 a year would cut the growth of gross domestic product per head by 3.4% lower than it would otherwise have been by 2030.Related: Amber Rudd says EU nationals in post-Brexit UK will need 'form of ID' Continue reading...
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by Kenneth Rogoff on (#24BH1)
His policies have risks, but deregulation, tax cuts and infrastructure spending will boost business confidenceAfter years of hibernation, will the US economy rouse itself for a big comeback over the next couple of years? With an incoming Republican administration hellbent on reflating an economy already near full employment, and with promised trade restrictions driving up the price of import-competing goods, and with central-bank independence likely to come under attack, higher inflation – likely exceeding 3% at times – is a near-certainty. And output growth could surprise as well, possibly reaching 4%, at least temporarily.Impossible you say? Not at all.Related: US economy adds 178,000 new jobs making Fed rate hike likely Continue reading...
by Larry Elliott Economics editor on (#24BH2)
Post-referendum recovery in UK was hit by 0.9% drop in output in October – and it cannot simply be dismissed as a one-offBritain’s post-referendum recovery in manufacturing came to an abrupt halt in October. Two months of rising output were followed by a chunky 0.9% drop in October.To put it mildly, this came as a shock to economic forecasters. Strong consumer demand, the fall in the value of sterling and, especially, strong survey evidence, had all pointed to rising factory production.Related: UK manufacturing slides, as Italian bank rescue hopes build – business live Continue reading...
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by Angela Monaghan on (#24BH3)
Surprise 1.3% drop in October dents hopes economy will end year on a highIndustrial production fell sharply and unexpectedly in October, dealing a blow to hopes that the UK economy will end 2016 on a high.A surprise 1.3% drop in production over the month followed a 0.4% decrease in September, according to the Office for National Statistics, and was the biggest monthly fall in four years. Economists had forecast a 0.2% rise for October.Related: UK's trade deficit before Brexit vote narrower than first calculated Continue reading...
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by Gareth Hutchens on (#249ZB)
New figures show GDP receded in the third quarter raising prospect of recession and also likely to put pressure on federal government revenueAustralia’s economy slipped backwards in the September quarter, by a greater than expected 0.5%.It is the first time in five years the economy has recorded three months of negative growth.Related: Australian economy: dollar tumbles after worse than expected GDP figures – liveRelated: What dealing with financial stress looks like: ‘We lost the house, we lost everything’ Continue reading...
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by Phillip Inman and agencies on (#249QD)
Office for National Statistics revises gap down to 6% from 7% after uncovering major mistake in import and export dataBritain’s trade deficit in the months before the Brexit vote was narrower than first calculated after the government’s statistics agency uncovered a major mistake in monthly import and export data going back to 2015.The multi-billion pound errors mean the UK appears to have relied slightly less on the “kindness of strangers†in the run up to the referendum. Continue reading...
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by Angela Monaghan on (#2490E)
Consumer spending and retail growth are stronger but manufacturing is falling back, figures showBritish businesses are becoming more reluctant to spend, according to the Office for National Statistics, as the UK relies heavily on consumers to prop up the post-Brexit vote economy.In its latest monthly snapshot of the UK economy, the ONS said there were signs that business investment growth was starting to slow. Investment by companies grew by 0.9% in the third quarter, down from 1% in the previous quarter. It fell by 1.6% on an annual basis.Related: UK office construction forecast to plunge after Brexit vote Continue reading...
by Kathryn Hughes and Phillip Inman on (#248QG)
You’d need to go back 150 years to find the last time wage growth was this stagnant, according to the governor of the Bank of England. But even then there were a few reasons to be cheerfulWhen Mark Carney insisted in a speech at Liverpool John Moores University that the conditions through which we are now living are “exactly the same†as those that British citizens endured during the “lost decade†of the 1860s, he was taking a bit of rhetorical licence. The past is never simply the present dressed up in funny clothes, and the analogy between today’s painful realities and those of 150 years ago doesn’t quite hold. And yet, the governor of the Bank of England had a point.When Overend Gurney collapsed in 1866, it undid once and for all the sense that, give or take a few individual misfortunes, capitalism was a moral force that rewarded skill and hard work. Toppling under a mountain of unsecured debt, the joint stock bank dragged down 200 businesses and a broad tranche of private investors with it, from courtiers to grocers. As with the Northern Rock crisis in 2007, there were queues of panicky investors lining the streets. More profoundly, now came a dawning realisation that bad things could happen to good people. Thanks to the publication of Charles Darwin’s Origin of Species in 1859, the universe increasingly seemed not only godless but, what was perhaps even worse, indifferent to the sufferings of ordinary folk.Related: Mark Carney: we must tackle isolation and detachment caused by globalisation Continue reading...
by Letters on (#248M1)
Wonderful news that Rob Wilson, the junior minister responsible for libraries, has recognised that libraries provide a vital public service to communities and has made an extra £4m available (Libraries to get £4m to diversify, 2 December).Here in Suffolk, our Industrial Provident Society (IPS) has been incredibly successful in managing its reducing budget for the county libraries. However, this is likely to change in the light of proposed cuts. Suffolk Libraries IPS will have to save a further £230,000 in the next financial year (2017/2018). This is on top of the previous year’s cut of £350,000. Over the past five years the total budget will have shrunk from almost £9m to a little over £5m if these latest cuts go ahead. Continue reading...
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by Rupert Jones on (#247H9)
Market expert says move could signal end of record low interest ratesThe first evidence has emerged that the era of record-low fixed-rate mortgages may be coming to an end after HSBC withdrew its “cheapest-ever†deal and increased rates on other products.
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by Katie Allen on (#2442D)
Bank of England governor urges policymakers to do more to share out the gains from global trade and technologyThe governor of the Bank of England has issued a rallying cry to policymakers across advanced economies to tackle the causes of a growing sense of “isolation and detachment†among people who feel left behind by globalisation.Warning that the UK was suffering its “first lost decade since the 1860sâ€, Mark Carney said that one of the reasons for the Brexit vote was a sense among people that they had lost control of their futures.Related: Mark Carney: European economies face hit if cut off from City of London Continue reading...
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by Katie Allen on (#246A9)
Markit forecasts economy will grow by 0.5% in final quarter as Barclaycard finds consumer spending is still rising
by Gareth Hutchens on (#246JX)
Asian Infrastructure Investment Bank releases draft energy strategy prioritising renewable projectsThe Australian government is lobbying for the Asian Infrastructure Investment Bank to put more emphasis on coal and nuclear after concerns renewable energy projects were being prioritised.Draft guidelines were circulated by the bank that suggest it should prioritise investments in renewable energy projects across Asia while the Turnbull government has argued fossil fuels will play a significant role in energy generation in the region for decades to come..Related: The new China-led Asian bank is a global financial system shake up Australia should be part of | Matt ThistlethwaiteRelated: World Bank welcomes China's new bank as means to fight poverty Continue reading...
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by Nils Pratley on (#244RR)
With eurozone authorities willing to bend their own rules, a solution could be at hand – though it would fix few long-term issuesInvestors’ ability to look on the bright side on political turmoil is remarkable. In the case of Italy, the departure of Matteo Renzi, the market-friendly centre-left prime minister, was followed quickly by the thought that the crisis in the country’s banking system may, counterintuitively, become easier to address.That wasn’t last week’s theory, of course. Back then, Renzi’s survival was seen as critical to encouraging private sector investors to cough up billions of euros of new capital to refinance the likes of Banca Monte dei Paschi di Siena and UniCredit.Related: How Italy became this century's 'sick man of Europe' Continue reading...
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by Larry Elliott Economics editor on (#244GA)
The Bank of England governor’s look back at previous crises suggests action needs to be taken to stop capitalism from eating itselfHistory repeats itself. That was the message from Mark Carney as the governor of the Bank of England sought to draw some conclusions about the future of globalisation at the end of a turbulent year.Carney’s argument was that the current lost decade is not the first. The 1860s had its own financial crisis: the run on Overend, Gurney & Co was the last to befall a UK high street bank until the queues formed outside Northern Rock in 2007. It was a time of rapid technological change and a prolonged period of falling real wages.Related: Mark Carney: we must tackle isolation and detachment caused by globalisation Continue reading...
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by Graeme Wearden (until 2.30) and Nick Fletcher on (#24243)
Italian bank shares volatile, but euro recovers after Matteo Renzi loses Sunday’s constitutional referendum
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by Rowena Mason Deputy political editor on (#243KE)
Chancellor and Brexit secretary say meeting aimed to examine impact of UK vote to leave the EU on financial sectorBanking leaders from Goldman Sachs and HSBC were among those who met the chancellor and the Brexit secretary to discuss how to keep financial services in the UK after leaving the European Union.Philip Hammond and David Davis hosted a gathering at the Shard tower in central London on Monday, amid concern among many banks about losing “passporting†rights and the potential shock of Brexit if there is no transitional deal to cushion the impact of leaving the EU.Related: Brexit leaves London-based banks facing 'nightmarish' choicesRelated: Hard Brexit will cost City of London its hub status, warns Bundesbank boss Continue reading...
by Larry Elliott on (#243XS)
Joining the euro removed the country’s only means of overcoming economic troubles and restoring competitivenessOn New Year’s Day in 2002, Italians gathered in Rome to throw their lire into the Trevi fountain. There were celebrations as Italians took possession of the new euro notes and coins that became legal tender as the clocks struck midnight.But hopes that the advent of the single currency would provide a fresh start for Italy’s economy were misplaced. The growth performance of the eurozone as a whole has been poor, but Italy’s has been dismal. Greece and Spain at least had booms before their painful busts; Germany and France have managed to claw back the ground lost in the deep recession of 2008-09.Related: Euro falls to 20-month low after Italy government's referendum defeat Continue reading...