via Austrian Peter
“The Financial Jigsaw” has been serialised here and is replaced by this weekly “Letter from Great Britain.” NOTE – If anyone would like an electronic copy of the complete book, I should be pleased to email a free PDF on request to: peter@underco.co.uk.
Britain faces a winter of discontent thanks to rising household costs, No 10 has been warned, as firms said the energy price shock could trigger a three-day week for factories and further gaps on supermarket shelves. Damian Green, a former cabinet minister, warned of the prospect of “very, very difficult times ahead for hundreds of thousands of people in this country”, because of higher energy bills compounded by the universal credit cut and next year’s rise in national insurance.
Labour said many households would be crippled by the “triple whammy” of energy price rises, the NI rise and universal credit cut. However, No 10 dismissed suggestions of a looming winter crisis as “alarmist”, and business secretary Kwasi Kwarteng said there was no question of “the lights going out”.
Food producers say the government should subsidise the fertiliser plants that produce the CO2 essential to much of the sector – including for packaging, fizzy drinks and animal slaughter – amid fears over shortages in supermarkets.
SO – What are the main threats this winter and how do we see them playing out? A number of other economic problems have emerged during the recovery. Because the recovery has been faster than expected across the world, commodity producers have struggled to keep up, driving up global commodity prices.
The biggest problem is oil and gas prices, with UK wholesale gas prices having almost tripled since the beginning of 2021. Gas is still one of the main components of the energy mix in the UK, so consumer prices for gas and electricity have risen sharply, while lots of businesses are being affected – for example, steel and fertiliser plants have been temporarily closing.
Several consumer energy companies have already gone bust, and various others could be in trouble if they have a lot of customers on fixed tariffs and too little room to make a profit with the current prices.
Meanwhile, shortages of everything from lorry drivers to carbon dioxide are causing problems in retail and hospitality. We’re seeing supermarket shelves increasingly empty. Brexit has made the whole situation worse because a lot of workers in the food supply chain came from the continent and are no longer allowed to work in the UK.
The government’s idea that British workers will rush to fill the gap is misplaced. Even if they could be trained in time, many British workers, after being furloughed or working from home, are not that keen on working in low-paid jobs with long and irregular hours. Lots of pubs and restaurants are struggling to stay open either because they can’t find enough workers or because of supply shortages. Employers in industries like hospitality and transport are already having to offer higher wages to attract staff.
The price and wage increases are producing higher inflation data. Whether this is temporary depends on people’s expectations. If people begin to expect more rises, as they did in the 1970s, it will change their behaviour. Firms will raise prices and more workers will want higher wages, causing an inflation spiral.
To keep the economy buoyant in recent years, the Bank of England has cut interest rates to record lows and injected huge amounts of money into the economy in the form of quantitative easing. If it has to change direction because of higher inflation, this could have a big effect on asset prices, ranging from shares to houses, since they have all been bid up by cheap money.
Higher interest rates would also have repercussions for the public finances, which Chancellor Rishi Sunak is clearly very worried about already. It would mean that future government debt becomes more expensive, which could put a further squeeze on public spending.
We are already seeing signs of the government taking steps to try and improve the public finances ahead of the critical three-year spending review and budget on October 27. The levy on national insurance to finance the NHS and social care reform is an obvious example, and so is the decision not to make the £20 universal credit uplift permanent.
These decisions will push more people into poverty, as could the end of the furlough scheme. Meanwhile, the decision to temporarily scrap the earnings-linked element of the “triple lock” will perhaps permanently reduce the generosity of the state pension. And the chancellor has already announced tax rises for businesses from 2023. Overall, almost every section of the community is facing either tax rises or benefit cuts, although the super-rich seem to have escaped largely unscathed.
Despite these tax increases, Sunak appears to be setting very ambitious targets to stabilise the public finances, which are likely to require further big cutbacks. Public sector pay is likely to be squeezed, as it was in the last spending review. If it is frozen in cash terms again and if inflation stays higher, this will translate into a significant wage cut in real terms.
The level of disruption caused by Brexit and the pandemic is unprecedented, as is the size of the public deficit for many years. With rising world energy prices again adding pressure at a time when the public finances are straining, we could well return to the stagnation in living standards of the last decade. Poverty and inequality may well increase, and we are probably going to see strikes. There will be similarities and differences to the 1970s, but a new version of the winter of discontent certainly could be on the cards.
AS usual, our government is creating policy ‘on-the-hoof’ having now conceded that temporary visas be issued for European lorry drivers – but too little too late: “Downing Street on Saturday night confirmed hastily compiled plans to add 5,000 HGV drivers and 5,500 poultry workers to a visa scheme until Christmas, to help the food and fuel industries with shortages.
However, even as the plans were formally announced, Marco Digioia, the head of the European Road Haulers Association which represents more than 200,000 trucking companies across the continent, told the Observer that “much more would be needed” than a temporary relaxation of immigration rules. “There is a driver shortage across Europe,” he said. “I am not sure how many would want to go to the UK.” Andrew Opie, from the British Retail Consortium, said the 5,000 limit would “do little to alleviate the current shortfall”.
The criticisms emerged as the supply-chain crisis spread: Ambulance and care workers have been affected by queues for petrol, following reports that some forecourts have not received expected petrol deliveries.
There were warnings that as many as one in five deliveries may not be reaching major supermarket chains on time or at all. Polling suggested that a majority of voters, believed Brexit was partly to blame” www.theguardian.com/business/2021/sep/25/european-lorry-drivers-will-not-want-to-come-to-uk
BUT where do the ‘booster shots’ fit into all this chaos? Even the FDA have failed to authorise further clots-shots as this stage and yet Britain is going ahead regardless.
“I have heard Sucharit Bhakdi time and again warn those who have already taken the shots to stop now. Time and again he has said the more Covid “vaccines” people take the more detrimental effect it has on their natural immune systems. In consequence there is a greater chance of having serious adverse effects, the most serious being death. He has been proved right. A recent Lancet paper says:
“Although the benefits of primary COVID-19 vaccination clearly outweigh the risks, there could be risks if boosters are widely introduced too soon, or too frequently, especially with vaccines that can have immune-mediated side-effects (such as myocarditis, which is more common after the second dose of some mRNA vaccines, or Guillain-Barre syndrome, which has been associated with adenovirus-vectored COVID-19 vaccines). If unnecessary
boosting causes significant adverse reactions, there could be implications for vaccine acceptance that go beyond COVID-19 vaccines. Thus, widespread boosting should be undertaken only if there is clear evidence that it is appropriate.”
Even an advisory committee to the FDA in the United States voted 16 – 2 against booster jabs for anyone under 65. And the level of protection afforded by the vaccines has fallen dramatically” johnplatinumgoss.com/2021/09/21/booster-jab-the-exit-strategy/
AND – we know that these booster shots can make the situation worse. “Given that no clinical trials have been performed on more than two injections of any “vaccine,” it is important to understand how the Covid injections interact with the immune system, and the implications for booster shots.
“In this document … We explain how several papers in 2021 significantly advanced our understanding of SARS-CoV-2 immunity, and therefore the science and safety of COVID-19 vaccines … that booster shots are uniquely dangerous, in a way that is unprecedented in the history of vaccines. That is because repeatedly boosting the immune response will repeatedly boost the intensity of self-to-self attack.” – Doctors for COVID Ethics
Doctors for COVID Ethics are doctors and scientists from 30 countries, seeking to uphold medical ethics, patient safety and human rights in response to Covid-19. Below are extracts from their comprehensive analysis: The Dangers of Covid-19 Booster Shots and Vaccines: Boosting Blood Clots and Leaky Vessels which we encourage all doctors and patients to read before promoting, delivering or accepting any further Covid injections.” Read in full: theexpose.uk/2021/09/22/why-covid-booster-shots-are-uniquely-dangerous/
HOWEVER – the problem of crisis in Britain is not contained within this tiny island because the latest crash of Evergrande will reverberate across the globe. “Like all successful Ponzi schemes, Evergrande’s rise to become a global Fortune 500 business hinged on it finding a steady supply of new suckers to hand over their money as “investments” in the Evergrande scheme.
Buoyed by a flood of incoming investment money, Evergrande churned out entire “ghost cities” of apartment buildings across China, selling the ludicrous idea that these apartments would serve as retirement assets for the millions of Chinese citizens who “invested” in their construction. As long as the buildings kept going up — and the bond payments were made on time — everybody convinced themselves they were getting rich. Madoff isn’t merely rolling in his grave… he’s laughing because it’s the same Madoff scandal, all over again, but at a significantly larger scale.
The Evergrande Ponzi scheme involves at least $300 billion dollars in direct debt, rippling into potentially trillions of dollars in total exposure around the world (among banks and institutional investors) due to leveraged investment instruments and the ripple effect of non-payment (i.e. default)”. www.naturalnews.com/2021-09-22-evergrande-everscammed-why-the-debt-bomb-contagion-will-spread-globally.html
HERE is a live example of how increasing household costs are impacting a Brit earning above average wages. “Joshua Wheeler-Gaunt, 33, is one of a growing number of people worried about rising energy bills and other costs.
Asked about the things that have become unaffordable or very pricey for him, he said: “Everything! From house maintenance to rising energy bills [and] the cost of replacing my increasingly unreliable 14-year-old car – almost impossible without buying something equally unreliable or going up to my eyeballs in debt.
“I think my energy bills are up by about £15 a month when compared with last summer, which will be more like £40 or £50 once it gets colder. Water rose by about £60 a year, council tax by a few pounds a month …. Each one eats into your spare income. I’d say about 40% of my salary is easily gone on house costs – mortgage, council tax and bills – before considering any maintenance or improvements.” Read more of this sad story as millions face similar: www.theguardian.com/business/2021/sep/22/40%-of-my-salary-goes-on-house-costs
BREXIT: The UK government had granted only 12 out of a total of 47 applications for licences for the French vessels under 12 metres long to fish the UK’s inshore waters. Responding to the government’s announcement on Tuesday night, France’s maritime minister, Annick Girardin, condemned the decision. “It’s a new refusal by the British to implement the conditions of the Brexit agreement despite all the work we have done together,” she said in a statement. “French fishing should not be taken hostage by the British for political ends.”
VACCINE ADVERSE REACTIONS: “In collaboration with several other anonymous pathologists, Professor Arne Burkhardt and Professor Walter Yang investigated ten deaths that had occurred after the person had received the Covid-19 vaccine, and this is what they found…
Of the ten deaths, the two Professors confirmed that they concluded five were very likely due to the Covid-19 vaccine, two were probably related to the vaccine, one was inconclusive, and two they concluded had no relation to the Covid-19 vaccine.” Full report here: theexpose.uk/2021/09/26/two-top-pathologists-reveal-astonishing-results-of-investigation-into-ten-deaths-linked-to-the-covid-19-vaccines-weve-never-seen-anything-like-it/
To be continued next week.