Smoke and mirrors of the highest order

I used to be a big fan of Kramnik as a player, but he seems to have taken a Fischer-like turn since retiring from classical chess, seeing conspiracies everywhere. Up to a point, as with Fischer, this deserves sympathy, but suing Navara is beyond the pale.

The c.£4bn hit to the public finances in 2029-30 from policy reversals on PIPs & WFA is not large in macro terms. Nonetheless it reverses the signal to markets that the government is prepared to take unpopular decisions for the sake of fiscal prudence. That could prove costly.

If Rachel Reeves goes at some point, could/should Starmer do what Sunak did with David Cameron, make Gordon Brown a Lord and bring him back as Chancellor to bolster credibility? It would require a rule change to allow a Lord to present Budgets etc but otherwise has attractions.

Does anyone else find it odd that Kwasi Kwarteng seems to have reinvented himself as the goto right of centre TV pundit on Chancellors and fiscal policy? It’s like having Eddie the Eagle as your lead pundit on the Olympics rather than Michael Johnson 😉.

It’s interesting AI+sensors replaced line judges at Wimbledon with generally improved performance, but we’re still a long way from robots being able to replace ball girls & boys. It’s another example of how AI has developed at the pace of sci-fi, but robotics has lagged behind.

Wins in Norway & Croatia suggest Magnus remains the top player in both classical and speed chess, but Gukesh is a serious challenger at classical and rapid (though not blitz). Duda and Wesley are still in the world elite at speed chess, despite drops in their classical ratings.

If there’s one thing worse than tariffs, it’s tariffs that keep changing every other day, making it impossible for affected businesses to plan. theguardian.com/us-news/2025/j…

The latest Office for Budget Responsibility fiscal risks report seems to have got more attention than usual even though its message of long term fiscal unsustainability is little changed from its reports for many years now. Indeed I wrote a PwC UK report with broadly similar conclusions back in 2003.

One should always take the specific numbers in monthly GDP estimates with a tankard full of salt. But it certainly feels like the UK economy has flattened off since utility bills and employer NICs rose in April and Trump threw a series of wild curveballs at the world economy.

No sign yet from this Office for Budget Responsibility analysis of any fiscal gap to fill in the Autumn Budget. But this remains very possible given that: - the impact of recent policy u-turns has yet to come through; and - the OBR could yet decide to reduce its trend productivity growth assumptions.

A good summary by David Smith of the current fiscal position. I’d not put much weight on data for June alone and Q2 2025 was in line with OBR forecasts. But the outlook is less rosy given higher gilt yields, the benefits u-turns and possibly lower trend productivity growth.

We got used to a lot of economic nonsense from the Leave side (and sometimes over-exaggeration from the Remain side) during the UK Brexit debates. But Trump really does take economic illiteracy to a whole new level.

I’ve never seen much point in the idea of a digital pound given the other digital payment methods at our fingertips and David Smith confirms this. He also mentions a good point from Adrian Coles that cash ISAs support UK lending while equity ISAs will be invested globally.

On the face of it, the US-EU trade deal seems like a humiliation for the EU. But it reflects the realpolitik of the current situation: - EU has more to lose from a prolonged trade war than the US - Trump could threaten to reduce US military support for Europe if rebuffed.

I just don’t understand why they are playing with no increment in an event with very high prize money and most of the top players in the world. It just leads to this kind of ridiculous flagging and numerous serious blunders in other games today.

In my 40 years as a professional economist analysing international data, I never imagined a US President would add himself to this list (albeit he’s firing someone not executing them). No economic data is perfect, but US labour market statistics have generally been pretty good.