Rachel Reeves puts UK on road to ruin in 1970s-style run on the pound | Personal Finance | Finance
Chancellor fell into the trap. It expanded the British financial black hole up to £ 50 billion without any way to fill. He cannot stop spending because labor does not allow the left. It cannot relax its financial rules, and declares them “cannot be bargained”.
Starmer Daren would not sack him, because he would panic the bond markets further and send the borrowing costs from the roof. This only leaves an option: it reunites in the autumn budget. And how little this will kill.
Reeves is already accused of taking England to a “Doom cycle”. Yes, he inherited a poor hand, but he played terribly.
The first budget increased taxes by £ 40 billion and increased their spending by crushing the growth by destroying jobs and businesses. More gifts are planned.
The UK will borrow £ 150 billion in the next 12 months. More than 100 billion £ 3 trillion £ will serve our national debt. This is direct money from the evacuation.
Now a new fear is stunning. After the expert, the expert faces a British currency crisis because Reeves’ incompetence destroys the reliability of the pound.
So far the sterling remained quite constant. However, economists warn that the dam is about to explode under the pressure of the Labor Party’s tax and expenditure congestion.
I visit the Poundsterlinglive.com, a low -key financial site dedicated to money markets. On Friday, on Friday, he was not quiet on Friday: “Pound Sterling Traders warned the 1976 -style crisis because England confronted stagflation.”
This type of line I can imagine, then dismiss it as a very alarmist.
“Rachel Reeves, Course to offer a 1976 -style crisis to offer a 1976 -style crisis at the end of 2025 or ’26,” He said.
The sentence accuses him for increasing public expenditures, borrowing and taxes to a great extent and nurtures all kinds of inflation.
Comparison creepy. Denis Healey was the chancellor of the worker who chaired the pound accident in 1976, when England was forced to “go hand” to the international money fund to avoid the explosion. It was a national shame.
Today, like Reeves, Healey spent the markets like a drunk sailor on the coastal trail until the market finally searched for time. This is how workers do the titles. Energy secretary Ed Miliband remains tens of billions.
Inflation has warned that Britain may face an economic accident that was soon directed by financial extreme access and political divisions with the inflation of 5% and 5% services in July. Other analysts agree. Justin McQueen from Reuters warned the 1970s about “Stagflation, which scared the mixture of stagnation and rising prices. The Swiss Bank UBS now says we are there: “Britain is already in a stagflationist situation.”
These are not political critics who want to get points, but respectable economists and money experts.
This makes warnings even more worrying. And it gets worse.
The IMF’s 1976 rescue forced Healey to the brutal expenditure cuts. These angry militant trade unions triggered the dissatisfaction winter and pushed labor from power for a generation. Today’s repercussions are open.
Reeves tried to buy unions with a refund of £ 14 billion with Bonanza. A year later, they returned for more.
While the RMT announces one -week tube strikes, young doctors, nurses and GPs can walk throughout the winter.
Council workers are already striking at Birmingham and leaving a pile of garbage on the streets. Experts warn that Britain is now confronted with discontent in an autumn. Add the immigrant rows that divide the country and political tension is sold higher.
Reeves celebrated himself in the same corner as Healey. IMF waits on the wings. The only question is whether it is forced to swallow the drug – or whether the unlucky successor should take it.
