Posts

ECB forecasting is a joke

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Over at Bruegel, Zsolt Darvas takes the ECB to task for systematic forecasting errors in the last five years. He shows that the ECB has persistently overestimated inflation and unemployment, and on this basis he questions the ECB's decision to end QE in December 2018. I share his concern that the ECB has tightened too soon, though as the ECB's QE program is seriously flawed and very damaging, I am not sorry to see the back of it.

But I think that in focusing on the last five years, he has underestimated the scale of the ECB's failure. Here is his lovely chart showing Eurozone inflation since the creation of the Euro:

The ECB's persistently high forecasts in the last five years are painfully apparent. But what interests me is not the forecasts, but the outturns. The entire chart shows a marked downward trend. Inflation in the Eurozone has never been stable. Not once, in its entire history.

What the chart shows is systematic policy failure by the ECB. It has never maint…

The real victims of the "Rape of the National Insurance Fund"

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Some things just make me furious. This post by David Hencke, for example. In it, he claims that politicians of all three main parties agreed to raise the state pension age for women to compensate for the ending of the Treasury's contribution to the National Insurance fund. This isn't true.

Not only is it untrue, but it directly contradicts the research upon which the article relies, and dishonours the memory of a man who fought hard for pensioners' rights.

Hencke based his article on this piece by Tony Lynes, written in 2006 as a basis for a National Pensioners Convention factsheet on the National Insurance (NI) Fund. As readers of this blog will know, the NI Fund is not a pension fund. It is a clearing house for receipt of NI contributions and their disbursement to pensioners and beneficiaries. Tony Lynes describes its workings perfectly:
National Insurance is the system through which contributions by working people and employers are paid into a fund - the National Insur…

The "Misérables" of the 21st Century

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On Saturday, I watched Ken Loach's 2016 film "I, Daniel Blake" for the first time. The following evening, I watched the second episode in the BBC's adaptation of Victor Hugo's 19th century novel "Les Misérables". And here is my unpopular opinion. I think that as a parable of the U.K. today, particularly the difficulties experienced by single parents, "Les Misérables" beats "I, Daniel Blake" hands down.

Why? Because Fantine's story is closer to the experience of single mothers today. True, we don't (yet) have a market for hair and teeth, and women today are much less likely to die of undiagnosed tuberculosis than they were in the 19th century. But the exorbitant cost of child care, and the fragility of employment, that were so disastrous for Fantine - these are all too often the reality for single parents today. Sadly, "I, Daniel Blake" highlighted neither.

Contrary to popular opinion, the vast majority of single …

Mental health and homelessness

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I haven't written a post for a while. I wanted everyone to read the post I wrote in November about my niece Annie's suicide. Writing new posts drops older ones down the list, and I didn't want her memorial post to disappear off the radar until after her funeral. Annie's funeral was last Tuesday, 18th December, the day after her 29th birthday. Now, it is time to write again.

But not yet to move on from the issues that Annie's death highlights. This post is about the link between mental ill health and homelessness. Particularly, "street" homelessness, or in common parlance, "sleeping rough".

Homelessness and rough sleeping have risen hugely in recent years. Government statistics show that between 2010-15, estimates of the number of those sleeping rough rose by 102%. This is partly due to changes in methodology to correct suspected under-reporting of the problem. But the Government admits that there is a real and considerable increase in the numbe…

A poignant Remembrance

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On Remembrance Sunday, we remember those who died in war. Particularly the First World War, but also those who gave their lives fighting in subsequent wars. This year, I sang at two remembrance services in which all the music was written by people who either died in war themselves or had relatives who died. The poems of Wilfred Owen, who died one week before Armistice in November 1918, brought home poignantly to us the "pity of war".

Perhaps one day we will also honour those who did not fight but still lost their lives, and all those whose lives were ruined by war - the parents desperately trying to find out what happened to their children, the wives left to bring up children on their own, the soldiers whose mental and physical health was ruined, the villagers and townspeople whose homes and livelihoods were wiped out, the thousands of women raped. And perhaps one day we will end the jingoism that disfigures many of our remembrance services. There is nothing to celebrate a…

Some governments really are like households

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In my last post, I said that the fact that a government can buy anything that is for sale in its own currency is not sufficient to confer monetary sovereignty. A country which is dependent on essential imports, such as foodstuffs and oil, for which it must pay in dollars is not monetarily sovereign. Some people disputed this on the grounds that such a country could earn the dollars it needs through exports. So I thought I would write a post discussing how realistic this is in practice.

Strictly speaking, the only country in the world that can always pay for everything it needs in its own currency is the United States. However, most developed  countries that issue their own currencies have deep and liquid FX markets that enable them to exchange their currencies freely for other currencies; many also have swap lines with the Federal Reserve. Eurozone countries don't issue their own currencies, but the bloc as a whole issues the world's second reserve currency. It is not going t…

Now state pension ages are equalised, let's fix the real problems

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Today is a day for celebration. After nearly 60 years of inequality and discrimination - originally against women, and more recently against men - the state pension age is at last the same for men and women. For one day only, both men and women will retire at 65. Tomorrow, the state pension age for both men and women will start rising again in lockstep, reaching 66 by 2020 and then to 67 and 68.

I make no apology for celebrating the equalisation of pension ages. In my view this is long overdue. I have expected it all of my working life, having first discussed it when I was still at school. I never thought it was fair that my brother 14 months younger than me should receive his state pension 6 years and 4 months later than me. We both work for our livings and we have both brought up children. Life has dealt us different cards - I am significantly poorer than him - but that is not a reason for me to have a much earlier state pension purely by virtue of being female.

That said, the rise…