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Yes, man’s a cretin

Capital gains tax rates in the UK should be the same as income tax rates, and the vast majority of people agree, and that could raise many billions of pounds a year for the UK exchequer.

Inflation. If rates are equalised then you need to have indexation added back into the system. Otherwise you’re just taxing the decline in the value of money. And there’s no guarantee – at all, rather the other way in fact – that adding indexation back into the system will lead to higher tax revenues.

Twisting a little

Donald Trump has suggested Jerome Powell could be sacked for fraud as pressure builds on the Federal Reserve chairman over a multi-billion dollar renovation of the central bank.

Following reports that Mr Trump was preparing to oust the Fed chief, the president told reporters: “I don’t rule out anything but I think it’s highly unlikely unless he has to leave for fraud.”

Twisting what he said there more than a bit, no?

Don’t take my investment advice, obviously

But this couild also apply to that of others:

British gilts are the most undervalued financial asset on the planet. You would hardly know it from our compulsion to talk the country down but the UK is today one of the least indebted states in the rich world.

There’s contrarian and then there’s contrarian.

His point is that corporate and household debt is down – which it is. But that doesn’t make gilts a bargain….

My, aren’t we all surprised

I was sure I’d written something about James Stunt’s gold business. Somewhere back in time – indicating that I didn’t think it was a very impressive business. Turnover was low. And profits in gold dealing are thin and far between. It’s a commodity business on commodity margins – a poor man’s view of what a rich and profitable business is because it deals with gold.

But, you know, can’t find it. Still:

Barclays has been fined £42m for money-laundering failings in a case linked to Bernie Ecclestone’s former son-in-law.

The Financial Conduct Authority (FCA) said the bank suffered multiple “failings in its financial crime risk management” while providing services to Stunt & Co, a gold bullion trader started by James Stunt.

Mr Stunt is a London socialite and art collector who was married to Petra Ecclestone between 2011 and 2017. His business was found to be at the centre of a £266m money-laundering scheme and he was prosecuted as a result of his involvement.

However, he was ultimately acquitted this year following a five-month trial at Leeds Crown Court.

Missed that trial entirely.

Four others involved in the scheme were separately convicted in March for their roles in what has been described as one of the largest money-laundering operations ever discovered in Britain. Police said the illicit funds were linked to organised crime, including drug dealing.

The FCA said Barclays failed to collect sufficient information about the source of £46.8m worth of funds paid into Stunt & Co’s account by another firm, Bradford jeweller Fowler Oldfield. The funds were later revealed to be the proceeds of crime.

Ah, yes, now I do recall the stories about that.

Anyway, my point was that a gold bullion dealer is a low margin business. Which still stands.

Power grabs

Governments should consider taxing artificial intelligence and cryptocurrencies to generate funds to deal with the climate crisis, one of the architects of the Paris agreement has said.

Laurence Tubiana, the chief executive of the European Climate Foundation and a former French diplomat, is co-lead of the Global Solidarity Levies Task Force, an international initiative to find new sources of funds for climate action by taxing highly polluting activities including aviation and fossil fuel extraction.

She said cryptocurrency should certainly be taxed, and levies on AI should be considered.

“That could be a first step – again, it’s the same rationale [for AI as taxing cryptocurrency], because they use a lot of energy,” she said. “Crypto seems to be something which is not regulated at all, and of course it’s a concern, from the financial stability element.”

But using power isn’t a problem. Using fossil power is. And no one – or v few perhaps – are using fossil to power either. So, no problem.

Also, hypothecation of tax revenues is a bad thing. Therefore we shouldn’t do it.

But political money grabs are always with us, right?

Could we borrow their Supreme Court for a bit?

The Trump administration has deported five immigrants described as “depraved monsters” to the tiny African kingdom of Eswatini, after the Supreme Court lifted restrictions on banishing people to third countries.

The five men — from Vietnam, Jamaica, Cuba, Yemen and Laos — were “so uniquely barbaric that their home countries refused to take them back”, Washington said.

The US has already deported eight men to South Sudan and has been looking for other countries to take deportees, after the Supreme Court said it could send people to countries where they have no ties.

That would be fun. “So, guys, this is Pynongyang. Have Fun!”

Eh?

Mrs Obama previously addressed rumours of strains on her marriage in May, telling reporters: “If I were having problems with my husband, everybody would know about it.”

She has also suggested that speculation about the state of her and her husband’s relationship is rooted in sexism.

How is that?

“We as women, I think we struggle with, like disappointing people,” she recently told podcast host Sophia Bush.

“So much so that this year people were, they couldn’t even fathom that I was making a choice for myself, that they had to assume that my husband and I are divorcing… that’s what society does to us.”

Nope, I’ve no clue what she means either.

Quite wondrous economics

The private sector is fundamentally unproductive in the UK, compared to the rest of the world; that’s the truth that we have to face.

We face  massive underemployment in this country as a consequence, and that’s the truth that we have to face.

Low productivity requires more labour to perform the same set of tasks. That’s what it actually means. Higher productivity means using less labour to perform that same set of tasks.

And there are whole communities starved of investment in the UK as a consequence of the private sector withdrawing from them, in effect, and that’s the truth that we have to face.

More investment means higher productivity and the employment of less labour to achieve the same tasks.

you can put your head in the sand and you can say, I’m talking nonsense,

Yes, yes, you are.

Rilly?

Financial services do not generate wealth; they merely reallocate it at most, with a (usually significant) margin having been extracted along the way by those making the financial services arrangements.

Places without financial services are richer, are they?

Dear God the man’s a cretin

One of the arugments against a wealth tax is how damn difficult it is to define, measure and caclulate wealth:

Given the attention now being given to that group in society, this is significant because it reveals that, despite all the political talk about cracking down on tax avoidance, the UK’s tax authority still does not know how much wealth billionaires actually hold or how much tax they really pay.

Quite. No one really knows how much wealth people have. Which is why a wealth tax etc etc….

Difficult to understand this

It’s a standard part of the lefty economic analysis that imports take jobs – good union jobs – from hte locals. Therefore economies should produce their own stuff.

Cuba’s economy is in its worst state since the early 90s, when the collapse of its then benefactor, the Soviet Union, led its GDP to shrink by one third in a matter of months. President Fidel Castro euphemistically labelled the crisis the country’s “special period”.

This time a combination of US sanctions

Therefore Cuba should be rich as Croesus given that no American – capitalist! – imports come and steal local jobs. So, which part of the analysis should they give up? About imports? Or socialism?

Blimey

News of her latest tax grab plan (there’s always another) – a £1.7bn raid on the high street in the form of increased business rates – was barely hours old and isn’t due to be implemented until autumn.

Yet it is already abundantly clear that it will amount to a spectacular own-goal. More empty shops, even higher prices and thousands of job losses will be the cost of the bumbling Treasury’s short-sighted raid.

The move is intended to level the playing field by charging those with bigger premises more in order to reduce the rates paid by smaller stores.

Yet as unpalatable as it is, the sad fact is that big business will ruthlessly protect their bottom line with price rises and sweeping cost cuts. The real losers then will be customers, employees, and our already dwindling town centres, not the companies themselves.

Mr. Marlow’s powers of analysis are unmatched. It’s landlords, not tenants, who carry the burden (no, not pay the cheques) for business rates.

Something for Ritchie

One of his wilder contentions is that government doesn;t have to issue bonds at all. But it does so because it provides a safe form of saving for the financial markets. Goodness of the heart style stuff.

UK government debt currently stands at around £2.7 trillion, with the Government’s interest bill this year expected to be around £100bn. David Miles, a member of the OBR’s budget responsibility committee, warned that the decline in full-salary pensions schemes, which were traditionally big buyers of UK government debt, could push up long-term borrowing costs by as much as £20bn.

Those financial markets desire less safe form of savings. So, Govt will have to pay higher coupons or issue less debt. Hey Ho, we get to the same answer whichever logical structure we use, eh?

This plan is sheer idiocy

Donald Trump’s plan for a 50pc tariff on copper is designed to turbocharge the American metals industry and safeguard supplies for the US military.

But then, you know.

Given that it will protect the US copper industry from overseas competition it’ll make it worse, much worse. And everyone will end up buying their cable from abroad, not their copper.

Stealin’ folks’ money

Europe is exploring using frozen Russian assets to pay for Donald Trump’s $10 billion (£7.4 billion) weapons package for Ukraine, the Telegraph can disclose.

Under the plan, profits generated from almost €200 billion (£173 billion) of Russian Central Bank assets seized by the European Union could be used as part of the bloc’s contribution to the new war chest.

Tends not to work out well when governments do that.

First it’s Russia, then it’s Russians, then it’s anyone called Ivan and finally anyone who squints funny.

They’re thieves, all of ’em. They may be stationary bandits but bandits all the same.

I support the superinjunction

It argued that lives would be at risk if the media or Parliament revealed the existence of the leak, or the asylum scheme that followed, because the Taliban would be alerted to the existence of the list and would target those who had helped the US-led coalition before its withdrawal in 2021.

Instead of being in place for four months

Up to that point I support it.

as originally requested while the MoD organised an airlift of those affected – the Sunak government, and then the Labour Government that replaced it last year, kept the injunction in place for nearly two years.

In October, a Cabinet sub-committee chaired by Pat McFadden, the Chancellor of the Duchy of Lancaster – and attended by Angela Rayner, the Deputy Prime Minister, Rachel Reeves, the Chancellor, Mr Healey, Yvette Cooper, the Home Secretary, and Shabana Mahmood, the Lord Chancellor – decided provisionally to expand the asylum scheme.

By then, the projected costs had increased to £6 billion, and at another hearing last November, when Mr Justice Chamberlain was told how much public spending was being concealed, he spluttered: “I am starting to doubt myself – am I going bonkers, because it really is £6 billion?

And there we have the return of the usual lying scumbag behaviour. Both lots, obviously.

Sure, you don’t announce you’re flying planes into Entebbe. But demanding no one ever reveal that you have done so? Fuck off.

Obviously so, obviously so

Free speech is under threat because Britons feel they cannot speak out for fear of offending others over race, religion and immigration, a study has found.

Nearly half of those polled (49 per cent) believe people are too easily offended, particularly if they speak out on race and immigration issues, according to research for the Commission for Countering Extremism, which advises the Government.

The more outspoken people’s views, the more likely they were to feel constrained by the risk of offending others. Older, white males without a university education are among the groups who feel the most restricted.

The restrictions upon speech bite on the older working class male because that’s who the restriction upon speech are aimed at, the older working class male. They’re the most socially conservative part of the population and the anti-free speech is all about suppressing social conservatism. Therefore that it works out this way is obvious.

And?

Sigh

This data is fascinating because it directly contradicts a great deal of data in HM Revenue & Customs’ own tax gap information on the corporation tax gap.

Bumbledy bumbledy

But if the Hacker Young data is right, and they have a long history of extracting data from HMRC via Freedom of Information requests, then all this corporation tax gap data is nonsense.

Bumbledy bumbeldy

This last point is, perhaps, the most important. I have, for many years, pointed out that the definitions of tax loss included in HMRC’s tax gap data have been open to question. In particular, HMRC has used a spectacularly inappropriate definition of tax avoidance to limit the scale of recognised losses attributed to this cause. Basically, they claim that unless an activity is considered to be tax avoidance under the Disclosure of Tax Avoidance Schemes (DOTAS) rules of 2004, they can ignore it for the purposes of calculating the tax gap. This will be their excuse for ignoring this transfer pricing abuse, because transfer pricing is not required to be disclosed under the DOTAS rules, and so, rather conveniently, falls out of the disclosure requirement for tax gap reporting purposes.

Sigh.

Spud uses a different definition – one pulled from etc – than HMRC. Which is why Spud’s numbers are different from those of HMRC. Of course, it’s Spud – pulled from etc – who is right. Sigh.

Spud on wealth

So I’ve restated this data, which the ONS has provided on a per-person basis, and there are right now near enough, 68 million people in the UK, although I’m sure not everybody has been counted for certain, and out of those, apparently 14 million are under the age of 18, and let’s be honest, most people under the age of 18 don’t own very much. So, there are, on that basis, near enough 1.9 adult people in every household in the UK.

So, if we restate that information on data per decile and simply make it now data per person rather than wealth per household, we get a different chart,  which is like this. And what that suggests is that, of course, each individual person in each individual decile has less than households do because we’ve divided every number by 1.9. It’s as straightforward as that. And so now we have people in the top 10% having wealth of around £2.3 million each, that’s each, and people in the bottom 10% still have near enough nothing.

ONS also splits it out by age of head of household. Top 10% tend to be 55 to 65. Mortgage paid off, pension topped up ready to be drawn down. Spud doesn’t bother with that.

Analysing wealth without looking at lifecycle effects is utter moronity. But then Spud….

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