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September 02, 2020


Dave Timoney

Perhaps all this reveals is that the Tories are fundamentally more conservative than capitalist.


«the Tories are fundamentally more conservative than capitalist»

Confusion of terms, I think that you mean that the Conservative party are fundamentally more tory than capitalist.

If that is what you mean, currently they seem so, because usually:

* The Conservatives are the party of incumbents, like all right-wing parties (not necessarily all extreme right ones).

* There are several types of incumbency, and they may be somewhat rival; toryism is about incumbents in "passive income" assets (land, finance), whiggism is about incumbents in "active income" assets (businesses),

* Indeed the Conservatives are a mix of (mainly) both nationalist tory and globalist whig, and currently the nationalist tory side seems to be more in control than the globalist whig side.


Chris, I suspect it's a combination of -

- short term-ism. A quick recovery is probably a recovery that takes us back towards where we were pre-lock down. This is the least risky thing for Tory re election prospects.
- small c tories, rather than capital. It's your middle managers that worry most about people getting away with slacking off at home.
- direct financial interest of Tory donnors. ie the people that will lose out if commercial real estate falls in value, or city centre land and property more generally.


It's the interests of Conservative donors that matter above all else. The depression of property based incomes in city centres, particularly London, will hurt big investors in the short-term till the market adjusts. But those donors have a lot of sway with the MMS and can afford to buy political favour.

There will be some bosses who cannot let go of command and control, even if evidence suggests (I think it does) that more even balance between WFH and office is more productive than presenteeism. There are specific tranches of management who will resist, I suspect those who least understand the work they are responsible for i.e. generic middle managers with limited relevant technical experience. I work in a technical role, where a PC and an internet connection is pretty much all I need, but I suspect it's harder for roles who 'do meetings' all day discussing things they only have a superficial understanding of.

But the cat is out of the bag now. My CTO was infamously cautious about existing plans to expand WFH to reduce office costs, but he recently admitted that being forced to go far beyond what was envisioned he cannot 'unlearn' it. It fundamentally changes how we look at office based work in the future.

José Matias

When I tried to publish this note in facebook I received this information:

"Este URL desrespeita os nossos Padrões da Comunidade relativos a spam:
stumblingandmumbling.typepad.com" or in english:

"This URL violates our Spam Community Standards:
stumblingandmumbling.typepad.com" ?????

Are you being censored by Facebook?


Interestingly, facebook does not allow your URL to be posted. Says that it is spam!


«In one respect, the right-wing conspiracy loons are right: Marxists have captured some of our major institutions – the institutions being the government and Tory party.»

But the conservatives whether tory or whig have always been marxists, to a fault, as they believe in the value theory of labour, in the related argument about exploitation, in the reserve army of labour as the enabler of that exploitation, and they have believed this for centuries, as this piece from arch-conservative Bernard de Mandeville from 1724 ("Essays on charities", written against charity or state funded schools) shows:

“The plenty and cheapness of provisions depends in a great measure on the price and value that is set upon this Labour, and consequently the Welfare of all Societies, even before they are tainted with foreign luxury, requires that it should be performed by such of their members as in the first place are sturdy and robust and never used to ease or idleness, and in the second, soon contented as to the necessaries of life; [...] If such People there must be, as no great Nation can be happy without vast Numbers of them, would not a Wise Legislature cultivate the Breed of them with all imaginable Care, and provide against their Scarcity as he would prevent the Scarcity of Provision it self?
No Man would be poor and fatigue himself for a Livelihood if he could help it: The absolute necessity all stand in for Victuals and Drink, and in cold Climates for Clothes and Lodging, makes them submit to any thing that can be bore with. [...]
From what has been said, it is manifest, that, in a free nation, where slaves are not allowed of, the surest wealth consists in a multitude of laborious poor.”

Robert Mitchell

The Bank of England should buy commercial mortgage backed securities, using the unlimited currency swap line with the Fed as needed. Investors get paid, and properties can be turned back into Commons.

One wishes someone would stand up strongly to conservatives instead of using cute, clever little semantic arguments. Enclosure was morally wrong (the Lockean Proviso has been grossly violated) but we can reverse it through public finance.


«using the unlimited currency swap line with the Fed as needed.»

And here we go again: given that it is a *swap* line, what prevents the Fed from spending the same amount of pounds they get, crashing the sterling and creating massive inflation?
The "unlimited currency swap line with the Fed" technique only works if the Fed "forget" the pounds they get, so it the swap does not actually happens, and the Fed in effect just donates an unlimited amount of dollars to the BoE, that is the Fed decides to fund without limit UK government spending forever, which seems "unlikely".

Robert Mitchell

And yet, the swap lines are permanent and unlimited. So the guarantee is there forever, however unlikely that may seem.


"The Bank of Canada, the Bank of England, the Bank of Japan, the European Central Bank, the Federal Reserve, and the Swiss National Bank have taken coordinated action to enhance the provision of liquidity via the standing U.S. dollar liquidity swap line arrangements."

BoE buys commercial real estate securities, as the Fed is doing in the US. If there are any resulting pressures on Sterling, dollars are freely available from the Fed. Forever. The swap lines are a standing facility and were heavily used in 2008; in 2020, the swap lines were tapped for $37 billion.

The point of the swap line network is to create an international dollar liquidity backstop. BoE should use that backstop to ease public fears of a crashing Sterling, should they buy distressed investments and do the right thing by the people of England.

As Fed Governor Dudley noted in the September 16, 2008 Federal Open Market Committee transcript: "if you provide a suitably broad backstop, oftentimes you don’t even actually need to use it". Public awareness of the existence of the swap line should be enough to soothe inflation expectations. If not, well as Dudley says elsewhere in that transcript, you know you have a real big problem that is there regardless of the swap lines ...


robert mitchell

To clarify the last sentence in my post above, Dudley says later in the 2008 FOMC meeting transcript, while discussing reserve management issues caused by potentially very large volumes in currency swaps:

"[...] if we have a credible backstop, then it
should calm the markets, and then the backstop should not be used. If we have a backstop and it
actually is used, that is presumably because market conditions are horrific. So in that
environment, you could argue that the reserve-management things are very second order
concerns in some sense."

Also, the reason the US wouldn't sell the pounds is because, as Bernanke puts it, "they [The ECB] seem to put a lot of value on having a distinct
swap line, which symbolizes the cooperation and coordination of the two central banks as
opposed simply to using their own reserves". Swap lines are "indicating global cooperation on these issues". Why would the Fed subvert the BoE's attempts to do public good?

The unlimited currency swap line network serves as a proxy for one world central bank. With one bank at the top of the money hierarchy, there need be no runs.


«And yet, the swap lines are permanent and unlimited. So the guarantee is there forever, however unlikely that may seem.»

Statements like that are simply too stupid to even consider.

However, for a laugh, consider the risk involved in the word "swap": at some point the USA may decide to fund their large budget and trade deficits by using the swap lines to extract unlimited amounts of sterling from the UK, crashing the sterling and the UK economy. What prevents them from doing so forever and without limit?
Why would a sovereign, independent England want to give the USA the unilateral option to effectively control the sterling money supply and potentially crash the UK economy and currency? Isn't monetary sovereignty an important goal?

robert mitchell

"crashing the sterling and the UK economy."

But that never happened to the US, despite an aggregated $10 trillion in swaps "extracted" from the Fed from 2008 to 2011. (See https://www.gao.gov/products/GAO-11-696 page 218).

Indeed instead of crashing, the US came out better than the counterparties to which it supplied unlimited liquidity.

If Sterling were the world's reserve again, it would not crash if the US borrowed unlimited amounts; it would do much better than without the swap lines.

The point of the swap lines is to lay the foundation for mutual cooperation and support between the biggest world central banks. Such support includes normal as well as crisis times. The Bank of Japan and the ECB have been using the swap line more than the BoE. Why doesn't the BoE tell the UK voters that it can get unlimited dollars anytime, and will use that ability to fund a basic income in coordination with the US, which will also be funding a basic income?

The empirical truth is that the more dollars there are, the stronger the dollar gets. The Fed and the BoE both benefit from the mutual swap line arrangement. Money is clearly emergent, not zero-sum. That is the lesson from the swap lines. That is what voters should learn.

Jan Wiklund

There are disadvantages with working from home - my old employer (I'm retired) tried working from home, but the guy responsible for the computer system told me it didn't work. The constant intermingling between employees was necessary for doing the job well. Not least the coffee breaks - there was a strong tendency that these were the moments when new bright ideas were born. After all, it's not the people who are bright, it's the settings. And at home, you have only the cat to help you get the good ideas.

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