Rethinking the Unaffordable is co-authored together with KPMG and takes an inquisitive look at the assumptions underpinning the Green Transition plan. Whilst asking if we are paying the right amount it also considers the implications on the competitiveness of the UK economy – the need to re-open the debate on energy in the UK could not be more urgent.
As this chart shows, sterling has just gone through 18 months of value stability against the dollar and the euro. That’s actually quite a long time. With everything happening now in Euroland and the USA going up against the wire on lifting the debt ceiling, I just wonder if the pound might be due for a long-anticipated recovery?
I don’t know how the final days of the Euro saga will pan out.
The only thing I’m sure of is that it will be very ugly and it’s demise won’t do us Brits any good unless you have a formula for pricing in Schadenfreude. I’m also staggered by the decision of the ECB to raise interest rates a quarter of a point to 1.5%.
So the big spike yesterday in the yield of Italian and Spanish bonds suggests to me that we are approaching the Euro endgame. Bailing out Greece is one thing. Supporting Spain and Italy would be an impossible other. If the yield goes to a fatal line of 7% according to Ambrose Evans-Pritchard in today’s DT, then it’s game over. Below is a chart of the Italian 10 Year Bonds. Spain is worse – just over 6%.
