It’s possible that John Penrose could be a tad peeved with me

He’s the MP trying to get the UK to have a sovereign wealth fund. He and I were asked for 160 words each by City AM:

The only reason to have a Sovereign Wealth Fund is to keep money out of the domestic economy. Norway’s fund is there to stop the torrent of oil money from driving up the exchange rate to the point where the rest of the economy is throttled.

So a wealth fund to invest in British infrastructure is ridiculous – quite apart from the fact that we run a trade deficit and thus aren’t about to suffer from that Dutch Disease the Norwegians are avoiding.

32 thoughts on “It’s possible that John Penrose could be a tad peeved with me”

  1. Ah, just another stinking politician trying to get his grubby mitts on a pile of your money. You need to order in some more hemp. I’m sure you can get better rates if you shop wholesale.

  2. So Much For Subtlety

    The only reason he can be doing this is because he wants a seat at the Top Table. If he can force us all to hand over our cash to a Sovereign Wealth Fund then people like him will get seats on the board of the FTSE 500.

    If he think we save too little he can do the obvious thing – allow us to save before tax. He could allow any amount of money to be placed in an ISA or the like and tax us on the rest. Which would be very fair for footballers and people like Adele who have short careers of high earnings and then a long life of sloth and drug dependency.

  3. If Britain had a Sovereign Wealth Fund – especially one run in conjunction with the Scots – it would be raided for expenditure on special interest projects or public sector pay rises before there was 10p in the tin.

  4. So Much For Subtlety

    Tim Newman – “If Britain had a Sovereign Wealth Fund – especially one run in conjunction with the Scots – it would be raided for expenditure on special interest projects or public sector pay rises before there was 10p in the tin.”

    The US does not have as many brain dead socialist kleptocrats as the UK and yet the Highway Trust Fund, which gets their petrol tax, is essentially bankrupt. And their Social Security Trust Fund gave all its money to the Feds and so only have a pile of IOUs.

  5. “If Britain had a Sovereign Wealth Fund – especially one run in conjunction with the Scots – it would be raided for expenditure on special interest projects or public sector pay rises before there was 10p in the tin.”

    They’d borrow against its theoretical future value even before it had started.

  6. “And their Social Security Trust Fund gave all its money to the Feds and so only have a pile of IOUs.”

    100% invested in T-bills, I believe (but I could be wrong). Which is INSANE.

  7. Where’s the money going to come from for it?

    Tell him to come back once he’s reduced government spending to below tax revenues (by reducing spending, not raising taxes), and then we can discuss whether to put the surplus into a wealth fund or reduce taxes.

  8. The description of the Dutch disease pretty well describes what has happened to Venezuela, though there is a problem of South American Commie Bolshevik Soul Dead Zombies to consider according to the stars of this blog.

  9. @DBC, oh yes, that soring Bolivar, that everyone was investing in…

    Couldn’t move for over-valued Venezuelan currency on the world markets. Everyone wanted a piece of it!

  10. Reed–have you not yet got a call from the new Muppet show?

    I heard they decided the Swedish Chef was waycist so they want a local loser to talk incomprehensible bollocks instead. It seems the 1950s wrote to recommend you but since they are long out of date who knows.

  11. abacab

    Great response to the bot/troll! It did make me laugh uncontrollably which has got me a few puzzled looks in the office!

    Tim Newman – absolutely agree. The idea of someone like Jez Corbyn or Nicola Sturgeon being able to direct an SWF is frankly stomach-turning, and sa you say, in order to have an SWF you need to have some wealth whereas the UK has the third highest net debt in the world, and if Murphyite ideas are implemented would surpass number 1 and 2 within 2 months, maybe less….

  12. @Van_Patten,

    Oi thankee, koind zir!

    The 2000’s must have been a good time for anyone physically in a position to do arbitrage between the black market and the official market, due to the massive differential (up to 100x) between the State-mandated bolivar/USD exchange rate and the black market one. If you were in a physical position to handle large quantities of cash (and get away with it), I suppose you could have bought bolivars with USD on the black market and then exchanged them again for dollars at the bank. If the bank had any…

  13. DBC, but Dutch Disease has been known about for forty years. If socialists were so good at planning an economy, they would have set up a Wealth Fund to avoid it, like the Norwegians did.

    But being “Commie Bolshevik Soul Dead Zombies”, they grabbed all the cash and fucked up.

    (and, as abacab pointed out, for Dutch Disease to have been the problem, the bolivar would have had to have soared in value rather than actually plummeting).

  14. If Britain had a Sovereign Wealth Fund – especially one run in conjunction with the Scots – it would be raided for expenditure on special interest projects or public sector pay rises before there was 10p in the tin

    Yep. The country where cutting the deficit from £100bn to £95bn is called ‘austerity’ thinks it needs a Sovereign Wealth Fund.

  15. So Much For Subtlety

    DBC Reed – “The description of the Dutch disease pretty well describes what has happened to Venezuela, though there is a problem of South American Commie Bolshevik Soul Dead Zombies to consider according to the stars of this blog.”

    Venezuela has had a large oil industry since WW2 at least. They were a founding member of OPEC.

    Yet strangely it has only suffered since the South American (or feckless Latin as I prefer) Commie Bolshevik Soul Dead Zombies took over. Odd that innit?

    Still, at least the Chavez family did its best to minimise this problem. By transferring so much of that oil money into their Swiss bank accounts

  16. “Still, at least the Chavez family did its best to minimise this problem. By transferring so much of that oil money into their Swiss bank accounts”

    Yes, Chavez had a “Sovereign Wealth Account”, with him as the Sovereign.

  17. Funny how many Leftist heroes end up as billionaires in comprehensively fucked countries. Arafat, Chavez, Castro…unlucky for Guevara to die so young or he would have joined them.

  18. “Funny how many Leftist heroes end up as billionaires in comprehensively fucked countries. Arafat, Chavez, Castro…unlucky for Guevara to die so young or he would have joined them.”

    Aah, but it’s not old money or aquired through “trade” (spit), so it’s OK. Their hearts are in the right place while they’re having people beaten, tortured and executed, after all.

  19. John Penrose MP wrote: “We’ve got an unbalanced, rock-and-roll economy that’s too dependent on consumer spending and doesn’t invest enough for the future. ”

    I suspect this is like the argument that the UK doesn’t make much. We do. We just don’t see 10,000 people a time streaming out of factories anymore. Because we don’t see investment in such an obvious form as a SWF then it can’t be happening.

    I also simply don’t trust politicians to do this sensibly. They won’t be wanting to run it as a well performing fund but as a slush fund for political wheezes such as PFI schemes and renewable energy, backed up by the taxpayer at both ends.

  20. SMFS: The US does not have as many brain dead socialist kleptocrats as the UK…

    Unfortunately we have just enough of them to staff the Highway Trust Fund and the Social Security Administration and pretty much every other government agency you’d care to think of. Over at David Thompson’s blog he keeps making fun of the halfwits who are getting an “education” in Anger Studies and related cuntery and I keep pointing out that these people mostly find a job working for the government, hence the dismal state of anything “public” in this great country.

  21. The Norway Sovereign Wealth Fund (Global) is the setting aside of income from their oil bonanza.

    We have no oil or other bonanza. Hence no Wealth Fund. We ain’t got no wealth. We have pissed it up against a wall.

    If you want, we could go flat out for fracking (as some will remember I am the number one fan world-wide of this technique which will soon incorporate microwaving insteadof pumpinf water and sand), which with good timing would be wonderful for the economy (and the country), whether it would produce the ‘bonanza’ required for a Wealth Fund is debatable.

    I however also believe that our masters and betters would not understand the nature of a wealth fund.

    It would be raided, monetised, robbed or go up against the wall. The concept of a rainy day would be conspicuous by its absence.

  22. I can’t see a UK wealth fund surviving its first Labour government. I’m not all that convinced about the Tories either.

    As a practice run, the UK gov had a relatively small store of wealth in the form of gold. Trying to remember what happened to a good chunk of that…

    https://en.wikipedia.org/wiki/Sale_of_UK_gold_reserves,_1999%E2%80%932002

    “The sale of UK gold reserves was a policy pursued by HM Treasury over the period between 1999 and 2002, when gold prices were at their lowest in 20 years”

  23. “The sale of UK gold reserves was a policy pursued by HM Treasury over the period between 1999 and 2002, when gold prices were at their lowest in 20 years”

    Broon probably thought that selling gould (sic) would push its price up.

    Because he was clever. Or something.

  24. Bloke in North Dorset

    Lefties don’t want an SWF, that requires economic and fiscal discipline, they just want to spend like they’ve got one.

  25. Bloke in Costa Rica

    The so-called “lock box” in the US is a lot of fun. When it comes time to open it they’ll find some dead moths, a few washers and a pile of IOUs. Milton Friedman said that the way it was “funded” had the same relationship to reality as “thirteen-year-old girls writing Valentines to themselves”.

    A Sovereign Wealth Fund in the UK would be indistinguishable, just another piggy bank for the piggies to plunder.

  26. when someone can convince me that man city has been a good investment then i will start to consider state investment funds as a possibly good idea.

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