But the committee in question – the Bank of England Monetary Policy Committee – is tasked with, is tasked with controlling inflation, and what is glaringly obvious is that it did not know how inflation works because as a consequence of these external shocks, over which it had precisely no control at all, they raised interest rates in this country to reduce demand for goods and services, which they claimed would drive away inflation when that was completely unnecessary, because that inflation was always, as I’ve already said, going to pass as a matter of fact through the progress of time. And what we now know is, that that inflation has passed through the progress of time.
But what we’ve got is a legacy of the actions of that committee.
We have interest rates that are now far too high.
Standard economics says raising interest rates curbs inflation. Interest rates were raised, inflation wa ccirbed. Spud is arguing that this proves that raising interest rates doesn’t curb inflation.
He’s got a point, though. I’ll admit to being a bit dischuffed when external shocks over which neither I nor the government have any control cause the BoE to raise rates and make me even more impecunious. I was going to try to cut my energy bills anyway. Raising rates on this basis makes it even more difficult for me.
And anyway, as Hayek said, inflation is always and everywhere a monetary phenomenon. Don’t print extra money, don’t create inflation. What happened between 2020 and 2023?
That inflation might have passed through, if they had actually slowed down their printing of money.
Of course they didn’t do that, so inflation continues.
I don’t think raising the interest rate will do anything if they speed up printing at the same time to pay for the increased debt that paying the increased interest involves.
“Pressing on the brake does nothing!”
“Well, take your foot off the accelerator.”
I’ll admit to being even more dischuffed when shocks over which I have no control but the government *does*, such as the fucking Net Zero bollocks, causes artificial scarcity which raises prices, which they then choose to call ‘inflation’ and which the BoE jumps on with raised interest rates. The fuckers are taking my money twice over and they can fuck off.
Would any Spud analyst be able to comment on ELIDIR PRODUCTIONS LLP. It’s difficult to see this as anything other than a tax avoidance (legal) and grant application vehicle for his son, where the granting body won’t award to an individual.
@ bongo -I see that Mrs Spud is multi talented- not only a GP, but a tax “expert” and now an “expert” in video production. It’s almost like she’s being used by some other party for other reasons, unless she IS multitalented.
Elidir Productions LLP has a slightly odd set up. Usually a two person LLP would have equal rights to both members but son has controlling voting rights (holds between 50 & 75%) and most of the rights to assets on a winding up (over 75%). Can’t be more specific than those percentages.
Tax avoidance – probably not, LLPs are tax transparent. Grant applications possibly – it’s Spud’s MO.
Limited Liability of course. Which as Spud says is a very valuable thing. So I’m sure he hasn’t set it up so that the members liability is fixed at £1. Which would be the equivalent of a 2 share, £1 a share company. The effect of both being that if the business goes bust owing people money, the limit of liability on its members/shareholders is £1 each.
Spud not being involved suggests he’s trying to distance himself.
Apparently this sort of thing is awful if you’re some working class oik who sets up a plumbing business but fine if you’re the son of the Sage of Ely. Zil lanes anyone?
” the Bank of England Monetary Policy Committee – is tasked with, is tasked with controlling inflation, and what is glaringly obvious is that it did not know how inflation works”
Well thats actually true. If they did they wouldn’t have called the post covid inflation ‘transitory’.
“as a consequence of these external shocks”
That is of course bollocks on stilts, inflation was on the up well before Uncle Vlad went on his Ukrainian holidays. About 6% and rising rapidly IIRC. All down to covid money printing.
Careful Jim, comments like “inflation was on the up well before Uncle Vlad went on his Ukrainian holidays”
can incur the wrath of some around here who don’t like puppets of pootin……..
Re Elodie LLP
Contact there is Thomas Bexwell. Aka Thomas Murphy. Wonder why he isn’t using his real name?
Suspicious no?
Thank you moqifen and andrew. I think it makes more sense now – a college, council, or nature reserve might grant a contract for some production or teaching work stipulating they won’t award to sole traders in case they fall ill or the car’s in a crash, so got to have two people, but why an LLP and not a Limited Company.
Norman – I think you’ll find that was Friedman.
Do we have an address for the company? Is this another business running out of a private dwelling for council tax purposes?
Thank you moqifen and andrew. I think it makes more sense now – a college, council, or nature reserve might grant a contract for some production or teaching work stipulating they won’t award to sole traders in case they fall ill or the car’s in a crash, so got to have two people, but why an LLP and not a Limited Company.
IR35?
When I was working for the Government 10 years ago using our 3 man company I was forever having to demonstrate I was compliant, or more specifically DCMS was shit scared of HMRC and needed to show they were 100% compliant because the burden was shifting to the employer. A colleague who was a registered sole trader had no problems.
I believe its become even more onerous for employers to show that they aren’t using contractors to get round employers’ to get round employers’ NIC etc.
BIS
“Do we have an address for the company? Is this another business running out of a private dwelling for council tax purposes?”
Yes we do. I’m sure you won’t be surprised to hear it’s the legendary end terrace in Ely!
“Pressing on the brake does nothing!”
“Well, take your foot off the accelerator.”
To some of them the very concept of a brake is anathma. See the current complaints about cutting the Winter Fuel Allowance:
“If they wanted to raise money, they should have a wealth tax.”
But is not about raising money, it’s about cutting spending. But of course, cutting spending is unthinkable.
Re “IR35?”
IR35 could apply to an LLP. An LLP is classed as an intermediary just as a Ltd company would be.
Certainly, though, an LLP is an unusual structure for a trading company. The LLP structure was created almost specifically for solicitors and accountants who couldn’t – at the time – operate as Ltd companies for regulatory reasons.
Murphy seems to like LLPs. Is it because he wants the limited liability (after the libel case against him) but doesn’t want to be accused f tax avoidance again?
Andrew C,
Thanks for the explanation.