THE CITY GRUMP

In keeping with the spirit of the times, here is a warning:

Some Readers may find some of the following content upsetting and the characters portrayed, disturbing. Having read this article, those readers may wish to seek help but I am unable to say where they may go for such.

After the swift ejection of the Truss/ Kwarteng combo, the general consensus appears to be that the grown-ups are back in charge. Well, if that’s so then they have been castrated of their capitalist cojones. It hasn’t taken Hunt and Sunak long to demonstrate their lack of credentials.

Jeremy Hunt got into gear, on the day hapless Governor Bailey announced he was intent on grinding the economy into the dust, when he trilled to the media that:

“We have to produce National accounts that balance”.

Has he any idea what that means?

Of course not and let’s be charitable and suggest he probably picked this up when walking along a corridor with some lobotomised Treasury official. Perhaps he is under the impression that banks only lend out what they receive from depositors and sound Western Government should do likewise. Somebody please tell him if either or both of those policies were pursued, capitalism would be at Albanian levels of prosperity. Mind you, it does seem we are becoming more Albanian by the day….

Twenty-four hours later we learn the Treasury’s pet Eunuch has let it be known that wouldn’t it be an excellent idea to increase Capital Gains and dividend tax rates thus removing another of capitalism’s fundamental planks of prosperity. How can a Conservative Chancellor fail to understand that the best way of discouraging investors and their business partners from putting up risk capital is to lower their reward for success?  It has to be said the Treasury have been keen on enacting these tax rises for years but then the Treasury does not consider itself there to promote growth, only to collect as much tax as possible and to that end Hunt is a most useful Eunuch to them.

But the castration of capitalism doesn’t just stop with Hunt. Our new immaculately turned out Prime Minister is also anxious to oblige. Why else would he reverse ferret and decide to fly off to COP 27? Doesn’t he realise he won’t be able to genuflect to that newly revealed rabid anti-capitalist, Greta Thunberg as she is too busy being interviewed by the likes of Jeremy Vine? Of course there is one sound capitalist reason why Rishi could make good down there in Egypt as he could stand up and say to the world at large:

“What’s the point of my capitalist Country, which generates a rounding error 1.6% of the world’s carbon draining its economy, when communist China is emitting 17 times that at 27%?”

And what about that other great untouchable and emasculator of capitalism’s wealth generation, the National Health Service? A few days ago we were treated to the revolutionary sight of Labour’s Shadow Health Secretary, Wes Streeting, declaring that throwing more money at the NHS was not the answer as first it needed major reform. We have reached a pretty pass when a Labour MP says what a supposed capitalist Conservative Prime Minister appears to dare not. In fact, as even some of Sunak’s commentariat groupies are beginning to acknowledge, Sunak isn’t telling the electorate what he thinks or wants to do about anything in particular.

Truly the Eunuchs are in charge.

The City Grump has spent some 40 years in the City of London. He started as a stockbroker’s analyst but after some years he decided he was too grumpy to continue with the sell side of things so he moved to the buy side and became a fund manager for the next 20 years, selling his own business in the 1990s. Post the millennium, he found himself in turn chairing a stockbroker, a financial PR company, and an Exchange. He still keeps his hand in, chairing a brace of VCTs and investing personally in start-ups. The City Grump’s publications are available here.