UK Politics Thread VII: Wake me DUP inside [can't wake UUP]

[Vassenor]

i suppose that would be good if we were a major exporting country or had any real prospect of becoming one instead of a net importer

which we aren't and don't, which is why we're constantly fluctuating between headlines saying "exports fall despite weak pound" and "exports up yay brexit!" instead of just "we exporters now"

Relevant article: How Much Does the UK Really Depend on EU Trade?

The debate over Brexit has been filled with apocalyptic predictions about its potential economic implications for the United Kingdom. But among the major flaws in these predictions is the fact that they focus on the U.K. as a whole. The United Kingdom, however, is made up of four distinct countries: England, Scotland, Wales and Northern Ireland. All four will be affected by Brexit in different ways, partly because they have different levels of exposure to EU trade.

Looking at the top trading partners for each of the countries reveals that EU export markets and EU import suppliers are not as critical as you might expect. Two of Northern Ireland’s largest export destinations – the United States and Canada – are not EU members. In fact, the U.S. is the largest export destination for England, and the second largest for Scotland and Wales. China is also either a top-five export destination or import supplier for each of these countries.

Northern Ireland is a particularly interesting case. It exports more to the EU than it does outside the EU, but it is disproportionately reliant on one member state: the Republic of Ireland. In fact, in 2017, its exports to the Republic of Ireland increased. In the first three quarters of the year, these exports were on track to account for nearly three-quarters of Northern Ireland’s total exports. (Note that this increase in exports may well be a result of the weak pound.) But it’s also true that Northern Ireland’s economy as a whole is not heavily dependent on exports. They account for only 8.9 percent of its GDP. That means that though Northern Ireland is exposed to fluctuations in demand from the Republic of Ireland, it would not be crippled by a downturn in the Irish economy.

Germany, France and the Netherlands are also important markets for each, and in turn, the U.K. is a critical importer of goods from these EU members. Seven percent of German exports, 9 percent of Dutch exports and 7 percent of French exports go to the U.K. – and all of these EU heavyweights have export-to-GDP ratios much higher than the U.K.

So when is the German car industry going to collapse then?

[Oil exporting People]

So when is the German car industry going to collapse then?

What the bloody hell are you even talking about?

[Trumptonium]

So when is the German car industry going to collapse then?

What the bloody hell are you even talking about?

Vassenor is a proponent of the theory that one side of the divorce must fall on its knees.

Although recently Vass has been displaying a few hints of the more extreme "EU FEDERALISM 2020" theory that Britain will inevitably join the third world should they choose a political route that divorces from the EU any further than diverging from the EU's regulations on cabbages.

[Eastfield Lodge]

What the bloody hell are you even talking about?

Vassenor is a proponent of the theory that one side of the divorce must fall on its knees.

Although recently Vass has been displaying a few hints of the more extreme "EU FEDERALISM 2020" theory that Britain will inevitably join the third world should they choose a political route that divorces from the EU any further than diverging from the EU's regulations on cabbages.

Vass is referring to the Brexiteer argument that the German car industry will push for a nice Brexit for Britain because they're so reliant on the British market.

[Souseiseki]

i suppose that would be good if we were a major exporting country or had any real prospect of becoming one instead of a net importer

which we aren't and don't, which is why we're constantly fluctuating between headlines saying "exports fall despite weak pound" and "exports up yay brexit!" instead of just "we exporters now"

Relevant article: How Much Does the UK Really Depend on EU Trade?

The debate over Brexit has been filled with apocalyptic predictions about its potential economic implications for the United Kingdom. But among the major flaws in these predictions is the fact that they focus on the U.K. as a whole. The United Kingdom, however, is made up of four distinct countries: England, Scotland, Wales and Northern Ireland. All four will be affected by Brexit in different ways, partly because they have different levels of exposure to EU trade.

Looking at the top trading partners for each of the countries reveals that EU export markets and EU import suppliers are not as critical as you might expect. Two of Northern Ireland’s largest export destinations – the United States and Canada – are not EU members. In fact, the U.S. is the largest export destination for England, and the second largest for Scotland and Wales. China is also either a top-five export destination or import supplier for each of these countries.

Northern Ireland is a particularly interesting case. It exports more to the EU than it does outside the EU, but it is disproportionately reliant on one member state: the Republic of Ireland. In fact, in 2017, its exports to the Republic of Ireland increased. In the first three quarters of the year, these exports were on track to account for nearly three-quarters of Northern Ireland’s total exports. (Note that this increase in exports may well be a result of the weak pound.) But it’s also true that Northern Ireland’s economy as a whole is not heavily dependent on exports. They account for only 8.9 percent of its GDP. That means that though Northern Ireland is exposed to fluctuations in demand from the Republic of Ireland, it would not be crippled by a downturn in the Irish economy.

Germany, France and the Netherlands are also important markets for each, and in turn, the U.K. is a critical importer of goods from these EU members. Seven percent of German exports, 9 percent of Dutch exports and 7 percent of French exports go to the U.K. – and all of these EU heavyweights have export-to-GDP ratios much higher than the U.K.

the point was that britain is a net importer. more specifically, that britain is a net importer of "things that we really need". the exact numbers of how much of that is EU and how much is not does not really change that.

[Trumptonium]

The Economist takes sanctimoniousness to the next level.

They admit to being to have been too pessimistic about UK growth following the vote and apologised for total inaccuracy.

However it blamed business and consumers for 'not fully understanding the implications of the vote.'

In other words, "we were wrong but only because you people are stupid" or failed to believe our lies

[Oil exporting People]

the point was that britain is a net importer. more specifically, that britain is a net importer of "things that we really need". the exact numbers of how much of that is EU and how much is not does not really change that.

That Britain is a importer of necessary items such as food has been realized for sometime, as those continentals and their submarines demonstrated twice in the last century; I fail to see what your point is.

[Proctopeo]

The Economist takes sanctimoniousness to the next level.

They admit to being to have been too pessimistic about UK growth following the vote and apologised for total inaccuracy.

However it blamed business and consumers for 'not fully understanding the implications of the vote.'

In other words, "we were wrong but only because you people are stupid" or failed to believe our lies

Or "we were wrong but only because our prophecy wasn't self-fulfilling".

[Souseiseki]

the point was that britain is a net importer. more specifically, that britain is a net importer of "things that we really need". the exact numbers of how much of that is EU and how much is not does not really change that.

That Britain is a importer of necessary items such as food has been realized for sometime, as those continentals and their submarines demonstrated twice in the last century; I fail to see what your point is.

the point is that it doesn't matter if exports of art or yachts are up if our food costs 25% more - even if exports were going up at a consistent rate, which they aren't, it still has a large negative effect

arkolon pretty much already said this much better than i did

[Oil exporting People]

the point is that it doesn't matter if exports of art or yachts are up if our food costs 25% more - even if exports were going up at a consistent rate, which they aren't, it still has a large negative effect

arkolon pretty much already said this much better than i did

Extremely unlikely to occur. In 2015 the UK imported £38.5 billion worth of food, of which 27%-roughly £10.4 Billion-was from the European Union; at the same time, however, the Brits exported £18 Billion.

[Vassenor]

What the bloody hell are you even talking about?

Vassenor is a proponent of the theory that one side of the divorce must fall on its knees.

Although recently Vass has been displaying a few hints of the more extreme "EU FEDERALISM 2020" theory that Britain will inevitably join the third world should they choose a political route that divorces from the EU any further than diverging from the EU's regulations on cabbages.

...that scarecrow must be about to burst soon if you keep stuffing it like that.

[Arkolon]

the point is that it doesn't matter if exports of art or yachts are up if our food costs 25% more - even if exports were going up at a consistent rate, which they aren't, it still has a large negative effect

arkolon pretty much already said this much better than i did

Extremely unlikely to occur. In 2015 the UK imported £38.5 billion worth of food, of which 27%-roughly £10.4 Billion-was from the European Union; at the same time, however, the Brits exported £18 Billion.

This isn't about the EU, this is about the effect of the fall in sterling. It was predictable that exports rise, especially of the price-sensitive sort, but it's equally predictable that imports from abroad rise, but they won't be substituted because they are price-insensitive. British consumers and businesses import a lot of things from abroad because they can't get it in the UK, like some staple foods like salads or vegetables, petrol or manufactured or intermediate goods that are an integral part of a British business' supply chain. Even if more yachts are sold abroad, this edge offered by a fall in sterling has to be compared to the rising cost of living due to rising inflation.

[Trumptonium]

The Economist takes sanctimoniousness to the next level.

They admit to being to have been too pessimistic about UK growth following the vote and apologised for total inaccuracy.

However it blamed business and consumers for 'not fully understanding the implications of the vote.'

In other words, "we were wrong but only because you people are stupid" or failed to believe our lies

Or "we were wrong but only because our prophecy wasn't self-fulfilling".

Indeed ... sowing fear, fear reduces consumer confidence, consumer confidence drags down business confidence, business confidence drags down investment, consumer confidence drags down consumer spending, spending and investment drag down growth.

Didn't work at step 1.

[Hydesland]

The Economist takes sanctimoniousness to the next level.

They admit to being to have been too pessimistic about UK growth following the vote and apologised for total inaccuracy.

However it blamed business and consumers for 'not fully understanding the implications of the vote.'

In other words, "we were wrong but only because you people are stupid" or failed to believe our lies

They are right to be pessimistic about UK growth, the evidence is very strong that growth has been negatively and substantially affected. It is not a "lie" to suggest, as both basic and advanced economics suggests, barriers to trade and bearish expectations of such can affect growth.

Secondly, I don't know what article you're talking about, but consumer behaviour has definitely been reckless, sorry if the truth is rude or sanctimonious.

[Trumptonium]

The Economist takes sanctimoniousness to the next level.

They admit to being to have been too pessimistic about UK growth following the vote and apologised for total inaccuracy.

However it blamed business and consumers for 'not fully understanding the implications of the vote.'

In other words, "we were wrong but only because you people are stupid" or failed to believe our lies

They are right to be pessimistic about UK growth, the evidence is very strong that growth has been negatively and substantially affected.

The evidence in May 2003 was also very strong* that not joining the Euro will spell a dire medium to long term future for the UK in comparison to its European peers. And let's not forget the famous apocalyptic predictions for Britain 2010 by 'Economists for EMU'.

according to: Paul Krugman, David Begg (Chair) Imperial College Business School, Olivier Blanchard Massachusetts Institute of Technology, Diane Coyle Enlightenment Economics, Barry Eichengreen University of California, Berkeley, Jeffrey Frankel Harvard University, Francesco Giavazzi Bocconi University, Richard Portes London Business School, Paul Seabright Toulouse University, Anthony Venables London School of Economics, L Alan Winters Sussex University, Charles Wyplosz Geneva University

It is not a "lie" to suggest, as both basic and advanced economics suggests, barriers to trade and bearish expectations of such can affect growth.

Basic and advanced theoretical economics seldom has relevant application to real-world practical events. Most often economics only serves the purpose of studying historical data to provide a background to policy, and is better described as the field of hindsight. The IMF famously has a recession-prediction accuracy rate not too far diverged from coin tossing, and traditional and still-mainstream concepts like the Philips curve which have an ongoing effect on economists' predictions fail to exist. Moreover, heads of governments who are economists by trade tend to make a gigantic mess of it. The first thing you are told when you join the GS global investment research division is to forget everything you've ever learnt at university.

Thankfully few economists have ever managed to find the charisma to be elected given their traditional social reputation. Those that did however, such as Bruning of Weimar Germany whose economic policies provided a brilliant depression to allow Hitler to sweep the country, Bossano of Gibraltar who put the citystate in a position of bankruptcy and incumbent Juan Santos of Colombia with his MSc in Economics and seven years of lecturing at LSE who is relishing in a 1% growth rate and whose only accomplishment is the doubling of national debt and the deficit and a record low consumer confidence rating. Let's not even go as far as addressing the "technocratic" governments led by economists Monti in Italy and economist Papademos of Greece.

Ok actually let me get that off my chest - Papademos brought Greece from a minor recession of -0.5% into -4% and Monti took what was a reasonably healthy economy that was growing again and plunged it into a two-year long recession (12-14) from 2% growth to -4% contraction. These technocrat economists don't seem to be the brightest apples in the roulette bar.

Modern examples of finance ministers and heads of government who have a good track record - such as Macron of France, Morawiecki of Poland, every South Korean finance and prime minister since the 80s - also have a track record of never studying economics at any level post-16.

Secondly, I don't know what article you're talking about, but consumer behaviour has definitely been reckless, sorry if the truth is rude or sanctimonious.

This is not an example of reckless behaviour, and savings rates are highly volatile due to their odd methodology.

The current savings ratio remains twice as high as that of the United States, is identical to that of the Netherlands and is also higher than every year since records began (1955) to 1966, commonly seen as Britain's postwar boom period.

Besides, savings are far too complicated to merely evaluate from one index, and it is perfectly possible to pursue a rational financial plan with extremely low savings.

[Vassenor]

The Economist takes sanctimoniousness to the next level.

They admit to being to have been too pessimistic about UK growth following the vote and apologised for total inaccuracy.

However it blamed business and consumers for 'not fully understanding the implications of the vote.'

In other words, "we were wrong but only because you people are stupid" or failed to believe our lies

They are right to be pessimistic about UK growth, the evidence is very strong that growth has been negatively and substantially affected. It is not a "lie" to suggest, as both basic and advanced economics suggests, barriers to trade and bearish expectations of such can affect growth.

Secondly, I don't know what article you're talking about, but consumer behaviour has definitely been reckless, sorry if the truth is rude or sanctimonious.

But that wouldn't fit with the fact that everything suggesting negative outcomes is supposed to be fearmongering.

[Trumptonium]

They are right to be pessimistic about UK growth, the evidence is very strong that growth has been negatively and substantially affected. It is not a "lie" to suggest, as both basic and advanced economics suggests, barriers to trade and bearish expectations of such can affect growth.

Secondly, I don't know what article you're talking about, but consumer behaviour has definitely been reckless, sorry if the truth is rude or sanctimonious.

But that wouldn't fit with the fact that everything suggesting negative outcomes is supposed to be fearmongering.

I have a feeling that if I invested $1000 in everything you said was going to go wrong, I'd finish the year as a very rich man with a new house.

[Questers]

Thankfully few economists have ever managed to find the charisma to be elected given their traditional social reputation. Those that did however, such as Bruning of Weimar Germany whose economic policies provided a brilliant depression to allow Hitler to sweep the country, Bossano of Gibraltar who put the citystate in a position of bankruptcy and incumbent Juan Santos of Colombia with his MSc in Economics and seven years of lecturing at LSE who is relishing in a 1% growth rate and whose only accomplishment is the doubling of national debt and the deficit and a record low consumer confidence rating. Let's not even go as far as addressing the "technocratic" governments led by economists Monti in Italy and economist Papademos of Greece.

Ok actually let me get that off my chest - Papademos brought Greece from a minor recession of -0.5% into -4% and Monti took what was a reasonably healthy economy that was growing again and plunged it into a two-year long recession (12-14) from 2% growth to -4% contraction. These technocrat economists don't seem to be the brightest apples in the roulette bar.

Modern examples of finance ministers and heads of government who have a good track record - such as Macron of France, Morawiecki of Poland, every South Korean finance and prime minister since the 80s - also have a track record of never studying economics at any level post-16.

The best thing said on this subject evr:

"The purpose of studying economics is not to acquire a set of ready-made answers to economic questions, but to learn how to avoid being deceived by economists."

[Minoa]

If a second referendum happens and the UK votes to stay, I think that will buy me more time in the UK: can't guarantee my long-term future in the UK, though.

[Hydesland]

The evidence in May 2003 was also very strong* that not joining the Euro will spell a dire medium to long term future for the UK in comparison to its European peers. And let's not forget the famous apocalyptic predictions for Britain 2010 by 'Economists for EMU'.

according to: Paul Krugman, David Begg (Chair) Imperial College Business School, Olivier Blanchard Massachusetts Institute of Technology, Diane Coyle Enlightenment Economics, Barry Eichengreen University of California, Berkeley, Jeffrey Frankel Harvard University, Francesco Giavazzi Bocconi University, Richard Portes London Business School, Paul Seabright Toulouse University, Anthony Venables London School of Economics, L Alan Winters Sussex University, Charles Wyplosz Geneva University

Oh for fucks sake - I've been through this so many fucking times. The reason we didn't join the euro was precisely because of economic analysis, particularly from people like Dave Ramsden, Peter Westaway, Wren-Lewis and other treasury economists - answering whether we adhered to ""Brown's"" '5 tests' with a resounding no (and quite right too). Not only that, but economists were hugely split at the time - with the majority of of monetary economists (you know, the people with actual expertise on the matter), being against joining the euro. This is absolutely nothing like the situation today. Some cherry picked letter is irrelevant. There was already work on the impossible trilemma and monetary straitjacket showing things like a euro could have very dire consequences for us.

edit: if you want to look at what standard economics actually said, and still says, about the euro, just look to Friedman.

Most often economics only serves the purpose of studying historical data to provide a background to policy, and is better described as the field of hindsight. The IMF famously has a recession-prediction accuracy rate not too far diverged from coin tossing, and traditional and still-mainstream concepts like the Philips curve which have an ongoing effect on economists' predictions fail to exist.

You are physically hurting me, can you please actually read about the Philips curve, it's initial success to match data and subsequent failure, how models were adjusted and what modern attitudes to the Phillips curve actually is?

Moreover, heads of governments who are economists by trade tend to make a gigantic mess of it.

This is hilarious since it's literally objectively false and a study was just done directly contradicting you:

https://twitter.com/DurRobert/status/945588452917174272

It's also hilarious that you have absolutely NO SUBSTANTIVE fucking response and all you can do is poison the well of ALL ECONOMISTS, a truly desperate and pathetic measure. Why? Because there is no substantive, theoretical or empirical way to get positive economic results from Brexit. The single study that did so, Minford's, has been shown to be complete nonsense multiple times.

You have absolutely nothing on your side, so you have to retreat to extreme nihilism and just declare that all experts are wrong - this - is - religion.

For the record, I don't even think Brexit will be that bad! We'll probably continue to go along as normal, continuing to grow, because we'll probably be able to reach some kind of sensible deal. It would all have been for nothing, and we'd be worse off than otherwise, but nobody is really saying there's going to be an apocalypse.

This is not an example of reckless behaviour, and savings rates are highly volatile due to their odd methodology.

The current savings ratio remains twice as high as that of the United States, is identical to that of the Netherlands and is also higher than every year since records began (1955) to 1966, commonly seen as Britain's postwar boom period.

Besides, savings are far too complicated to merely evaluate from one index, and it is perfectly possible to pursue a rational financial plan with extremely low savings.

Why have savings suddenly plummeted

Please tell me what massively coincidentally secular fluctuation happened to perfectly coincide with the aftermath of the Brexit vote that explains this?

[Trumptonium]

Thankfully few economists have ever managed to find the charisma to be elected given their traditional social reputation. Those that did however, such as Bruning of Weimar Germany whose economic policies provided a brilliant depression to allow Hitler to sweep the country, Bossano of Gibraltar who put the citystate in a position of bankruptcy and incumbent Juan Santos of Colombia with his MSc in Economics and seven years of lecturing at LSE who is relishing in a 1% growth rate and whose only accomplishment is the doubling of national debt and the deficit and a record low consumer confidence rating. Let's not even go as far as addressing the "technocratic" governments led by economists Monti in Italy and economist Papademos of Greece.

Ok actually let me get that off my chest - Papademos brought Greece from a minor recession of -0.5% into -4% and Monti took what was a reasonably healthy economy that was growing again and plunged it into a two-year long recession (12-14) from 2% growth to -4% contraction. These technocrat economists don't seem to be the brightest apples in the roulette bar.

Modern examples of finance ministers and heads of government who have a good track record - such as Macron of France, Morawiecki of Poland, every South Korean finance and prime minister since the 80s - also have a track record of never studying economics at any level post-16.

The best thing said on this subject evr:

"The purpose of studying economics is not to acquire a set of ready-made answers to economic questions, but to learn how to avoid being deceived by economists."

Quite. I like the quote, even though I generally tend to drift to mainstream economics.

Oh for fucks sake - I've been through this so many fucking times. The reason we didn't join the euro was precisely because of economic analysis, particularly from people like Dave Ramsden, Peter Westaway, Wren-Lewis and other treasury economists - answering whether we adhered to ""Brown's"" '5 tests' with a resounding no (and quite right too).

Yes - people part of the Government Economic Service who worked closely with the Treasury to provide economic analysis to non-economics-by-field chancellors, who used them merely for guidance at best.

You'll find that the GES (as an institution, rather than individual members, bar academic professors) have been quiet on the issue of Brexit since the election, especially in terms of 'predicting' the consequences the decision might have in the short-term, which will be characterised by nothing less and nothing more than uncertainty and volatility. The Treasury itself has also been quiet, albeit that might have to do with the government saying no such analysis has been commissioned.

People who have laid out their opinions and various apocalyptic warnings are generally the same as the 'Economists for EMU' cohort. Academics and economists by trade who work in businesses that maintain an intrinsic advantage by residing within the EU regulatory framework.

Not only that, but economists were hugely split at the time

Not quite. Even the famous 'academic poll' itself showed a very heavy majority in favour of the Euro, with only monetary economists (something like 80 people asked?) against by 2 to 1.

- with the majority of of monetary economists (you know, the people with actual expertise on the matter), being against joining the euro.

Oh so we're now choosing which school is the best school?

I presume then that monetary economists have been better at predicting economic activity than other schools of thought, unless we're subjectively rating them by whose analysis of the past made the most sense. Which is hardly a good benchmark.

This is absolutely nothing like the situation today. Some cherry picked letter is irrelevant. There was already work on the impossible trilemma and monetary straitjacket showing things like a euro could have very dire consequences for us.

This is like the situation today. What's different? That monetary economists are remain?

Who cares anyway. These schools of thought only have a relation to policy, rather than the private market. And in terms of policy, the mainstream in many countries is shifting back to Keynesianism or some form of mercantilist monetarism. After all much of economics is a self-fulfilling prophecy, so soon one of those schools of thought will make more sense, just like keynesianism made more sense in predicting the future right up until 1970s.

edit: if you want to look at what standard economics actually said, and still says, about the euro, just look to Friedman.

'Standard economics', again, is a word that has described multiple schools of thought throughout life, and will likely change in the future, like right now.

You are physically hurting me, can you please actually read about the Philips curve, it's initial success to match data and subsequent failure, how models were adjusted and what modern attitudes to the Phillips curve actually is?

Enlighten me, you seem to have the answer to life.

Moreover, heads of governments who are economists by trade tend to make a gigantic mess of it.

This is hilarious since it's literally objectively false and a study was just done directly contradicting you:

https://twitter.com/DurRobert/status/945588452917174272

Again, we're discussing the past. The forte of the field of economics.

Also the summary clearly points out that economic growth tends to be faster during the first year of a term, and this is due to increased investment. In other words, a greater business confidence that an economist won't fuck up an economy, or otherwise another self-fulfilling prophecy not based on any policy at all.

Especially this part

Investors hasten their activity in anticipation of their economic leader's eventual reduction of the top personal income-tax rate.

In the simplest of words, in case you don't catch the drift, investors increase their gross investment outlay in expectation that an economist head of government subscribing to mainstream economics will reduce personal income tax rates for the richest, or otherwise speculating that their own personal financial situation is due to improve. Once this materialises (or doesn't), the situation returns to normal, as VERY clearly shown on the graph.

One would have expected that self-proclaimed economists would be so incredibly analytical that their policy choices would mean better growth on average throughout the year, as they are supposedly better able to apply the appropriate policies.

Most importantly let's realise the comment on page 28:

"economic leaders often come to power during periods of slowing growth"

and hence free-ride on a period of cyclical recovery, as the voting public expects (like investors) that economists will generally perform better than non-economists. Again, self-fulfilling prophecy.

Let's also take note that Mr. Craig O Brown of Northeastern University has never stepped foot in the private sector. I have very serious reservations about anyone who has spent all their life in academia due to the culture persistent in these places, namely where being wrong is a pat on the back and better luck for the future. Or 'learning experience' as they call it.
(Rutgers University > PhD Michigan 2002-2006 > Assistant Prof. of Finance NUS Business School > Visiting Associate Prof. of Finance Northeastern University)

Meanwhile, real world examples such as those I have listed, not least Juan Santos, the current President of Colombia who has an MSc in Finance and spent years lecturing at LSE in the 80s while getting a MPA in Harvard, is now literally running his country into the ground like his neighbour to the east.

Hence, the paper is utter horseshite and irrelevant to anyone who is outside of the academia and doesn't wank to technocratic whims. It certainly is irrelevant to anyone in the private sector, where people in the academia are oh-so-often derided.

Also, while the economic growth mean for 'economic leaders' is higher, standard deviation is twice as high. So it very well might be a small group of people skewing the statistics. Warren Buffet has certainly done well from his studies, but that doesn't represent the median wealth of economics graduates and sure as hell will raise deviation. Although Buffet himself says his studies did not really help him in his daily life and he lays blame on his experience, business analytics, optimism and books, particularly Graham's.

On page 33 we see two people explicitly named (Ronald Reagan and Lee Kuan Yew) who skew the statistics due to their long tenure. The author himself admits somewhere earlier that the number (some 1600 leaders in total) is high due to the typical short tenure.

Also, studying 140 countries is horseshit. Should be limited to developed economies.

Finally, the paper seems to be retarded. It mentions Lee Kuan Yew as an economic leader. I can only find information on him being admitted to the English bar after completing law at London School of Economics & Cambridge, before receiving a honorary doctorate from a random university in Singapore for economics. What exactly are his economics qualifications, or what does the author know that google doesn't?

It's also hilarious that you have absolutely NO SUBSTANTIVE fucking response and all you can do is poison the well of ALL ECONOMISTS, a truly desperate and pathetic measure. Why? Because there is no substantive, theoretical or empirical way to get positive economic results from Brexit. The single study that did so, Minford's, has been shown to be complete nonsense multiple times.

Oh there we go again

You have absolutely nothing on your side, so you have to retreat to extreme nihilism and just declare that all experts are wrong - this - is - religion.

I think the issue is that you have an attitude problem, and the only reason that you resort to throwing studies here and there is because academia is your one and only resort. Like the rest of self-appointed 'professional' economists, you seek to join the cushy academia because you would be unable to survive in the private sector, where accuracy actually matters.

A bit like Good Will Hunting. Nice movie, watch it. You resort to a comfort zone of throwing studies, along with the rest of academia, which fail to provide any substantive understanding of the modern world except for analysing the past.

For the record, I do not declare that all experts are wrong. I openly acknowledge the benefits of studying policies to know their effects, because shooting in the dark is hardly good governance. However, good governance is not listening to a group of people whose only use is to train others to join the workforce and succumbing to their collective whims, even if their collective whims tend to not exist because two economists in a conversation will give three opinions.

Why have savings suddenly plummeted

Please tell me what massively coincidentally secular fluctuation happened to perfectly coincide with the aftermath of the Brexit vote that explains this?

Cheap credit and reduced interest rates and OSF lending rate.

A holiday to Cuba gives me more utility than stashing cash in a 0.02% interest savings account. Overwhelming majority of people don't utilise personal investment plans, so are limited to current accounts, savings accounts, NS&I bonds and the odd ISA, all <1% with a radical decrease in the aftermath of the interest rate decision.

It's also part of the longer term trend since 2011 actually with QE, just hastened. The savings ratio is merely reaching parity with the base interest rate, as it has done in 1999 and 2007, as it tends to do when there's no economic cycle to be worried about.

I also rather subscribe to the theory that the savings ratio is falling on a psychological level on the basis of extremely unaffordable housing, as that is the main purpose of saving in this country.

I repeat, the UK savings ratio is still twice as high as the United States, is broadly in line with the Netherlands, and is higher than the postwar boom period of 55-60s. It's actually funny that FT conveniently decided to cut off those beginning years to exacarbate the effects on a graph. FT is quickly turning into CNN, no wonder subscriptions are falling. The data clearly exists, and 1963 data is no more relevant to us than 1955 data, so the only conclusion is that FT wanted to deliberately exaggerate their point. Or fearmongering, if you will.

Moreover, a mere survey is not exactly an accurate methodology, hence the extreme volatility of saving rates.

There is some correlation with house prices to earnings ratio (hence the 'psychological effect')
In the early 90s we see savings rise as house prices fall, then we see savings fall as house prices rise. Of course one might be a causal effect of the other, not necessarily prices > savings. Exceptions include 2000 due to labour pension reforms and the 2008 crash, no earlier data for house prices provided.

They're highly dependent on how they're calculated. And who calculates them.

[Hydesland]

Not quite. Even the famous 'academic poll' itself showed a very heavy majority in favour of the Euro, with only monetary economists (something like 80 people asked?) against by 2 to 1.

It wasn't that heavy, it was 64% to 36% in general - more than a third said it was a bad idea, that's a very substantial minority and not remotely like Brexit.

Oh so we're now choosing which school is the best school?

I'm not talking about a school, I'm not talking about monetarism - monetary economist, and a "monetarist" are not the same thing. Monetary economists study money and monetary policy, thus have the most relevant expertise - and guess what they opposed the Euro by a significant majority.

This is like the situation today. What's different? That monetary economists are remain?

They're far less divided on the economic effects than they were with the euro.

'Standard economics', again, is a word that has described multiple schools of thought throughout life, and will likely change in the future, like right now.

I guarantee you what's written there won't find much controversy from right wing monetarists to left wing post Keynesians.

Enlighten me, you seem to have the answer to life.

It's not my job to educate you on the broad trends in macro (which for a long time very recently completely was against the Phillips curve by the way) thought over the last several decades.

-snip-

You're missing the point - you made a strong claim and the data directly contradicts you. It doesn't matter if you can come up with a bunch of ad hoc qualifications to explain that the data is unremarkable to you, it still contradicts your initial claim completely.

Meanwhile, real world examples such as those I have listed

You cherry picked. I could have chosen a billion non economically trained leaders who did absolutely catastrophically fucking terrible, and contrasted it with Singh, Yellen, Volcker etc etc... That would also be cherry picking. It's also amusing you're allowed to make numerous qualifications for the study but didn't do anything for the leaders you mentioned, where there where numerous factors going on - for example it's obnoxious you mention Monti as if anyone could have made Italy entirely robust to the huge euro crisis that happened in the middle of his term - where he has no control over the ECB and hence the source of the problem in the first place.

I think the issue is that you have an attitude problem, and the only reason that you resort to throwing studies here and there is because academia is your one and only resort. Like the rest of self-appointed 'professional' economists, you seek to join the cushy academia because you would be unable to survive in the private sector, where accuracy actually matters.

Nice try - I'm not in academia and I don't even work as an economist! In fact, my most recent role was in software development in... shock horror... the private sector!

For the record, I do not declare that all experts are wrong.

Except when convenient for your argument. Which is exactly what's going on here - you know that you're not going to be able to provide any empirical or theoretical analysis that shows Brexit will be economically beneficial (unless we miraculously get fantastic deals from Europe and all other nations, which seems unlikely), so literally the only way you can continue arguing your side is to just flat out deny economics completely.

Cheap credit and reduced interest rates.

And what caused the cheap credit and reduced interest rates? Oh! The Bank of England, run by economists, enacting further stimulative monetary policy and lowering rates immediately after the vote. And why did they do this? Because they had the foresight to see Brexit would have a negative impact and acted accordingly. You realize this is rather devastating to your overall premise right? The only thing keeping the economy afloat is this monetary policy, and this aggressive policy is barely keeping us above total stagnation - while saving rates get lower and lower. This is not a good situation.

[Arkolon]

It might be worth saying that falling saving rates are not important in themselves unless they translate to an excess of consumer debt over consumer savings – which is the case in the UK. If GDP growth, in the form of 'recovery' or 'better-than-expected performance' is based on rising debt, there is a reason to view this as unsustainable and potentially dangerous.

[Trumptonium]

It might be worth saying that falling saving rates are not important in themselves unless they translate to an excess of consumer debt over consumer savings – which is the case in the UK.

Issuance of consumer debt has plateaued since the beginning of 2016. More so, the trailing 4-month average is the lowest (Nov 17) since January 16.

That's still very high levels of debt of course, but these numbers show no correlation with the falling savings ratio since Q3 15.

If GDP growth, in the form of 'recovery' or 'better-than-expected performance' is based on rising debt, there is a reason to view this as unsustainable and potentially dangerous.

Most UK debt is with mortgage claims, and an ever increasing proportion are on fixed rate mortgages, and an ever increasing proportion are with foreign banks. If I remember correctly, Santander is now the UK's 2nd largest mortgage lender. So that provides ... a cushion.

[Arkolon]

It might be worth saying that falling saving rates are not important in themselves unless they translate to an excess of consumer debt over consumer savings – which is the case in the UK.

Issuance of consumer debt has plateaued since the beginning of 2016. More so, the trailing 4-month average is the lowest (Nov 17) since January 16.

That's still very high levels of debt of course, but these numbers show no correlation with the falling savings ratio since Q3 15.

I wouldn't use the word 'plateaued', seeing as consumer credit grew at an annual rate of 10%, mostly due to growing credit card loans or car finance. This ties into the falling saving rates, as consumers maintain their standard of living despite falling wages and rising prices, leading to a lower savings ratio and greater indebtedness, especially of the unsecured sort (see Mark Carney on the topic). We can imagine this was exacerbated by rising inflation, imported as the value of the pound fell. In general though, I wouldn't pin this on Brexit on its own, this was years in the making as austerity, stagnant wage growth and loose monetary policy kept the economy chugging along by issuing more and more debt to consumers rather than leading to greater business investment, and so greater exports and productivity. While annualised growth in credit card debt has stayed flat since early 2017, it still grows at around 9% per year, definitely outpacing wage growth – if you compare this to large businesses (~2.5% growth pa) or SMEs (~0.5% pa), you will see where the GDP growth is coming from.

Maybe this is what The Economist was hinting at: consumers are pretending Brexit had no effect, so refuse to adjust to a lower standard of living by taking on more debt to finance their consumption. More crude economic models might have expected them to make a correction immediately, but this is just postponing the problem as debt interest most likely picks up in the coming quarters and the disposable income squeeze gets worse, eventually leading to lower consumer spending and so weaker GDP growth - if this isn't already happening. One can only wonder what kind of effect this has on the electorate...