The political class is 'indulging in fantasy economics' - sums it all up! and (as I just wrote on your previous post) the UK is badly adrift and ..rapidly sinking. I'll spell it out -it needs someone like you, if not you, to point out the Emperor's new clothes and.. bring the UK back into line!
Israel (and Saudi Arabia) talked Trump into attacking Iran. But it is rather a stretch to say the Israelis are “stopping Trump from exiting”. Trump’s paralysis runs far deeper and darker than that. He cannot admit to himself that he dragged the US into the worst strategic defeat in its history, just as he cannot admit that he lost the 2020 election. Netanyahu may be nefarious, but he is not Rasputin.
Thanks. Saudi Arabia was actually opposed to the Iran war at the outset, but now that Iran controls the Strait of Hormuz, it is one of those Gulf countries urging Trump to finish the job by reopening it. I think it is pretty well-documented that Israel was instrumental in persuading Trump to start the war and was opposed to the ceasefire (and indeed is continuing to level southern Lebanon), but I agree that the strategic failure is entirely Trump's, which is why he is now lashing out at allies in Europe in a desperate attempt to spread the blame...
Excellent, as ever, thanks Simon. Fantasy economics has settled like a fog over British government for many years, largely undisturbed by serious debate.
I agree that we need to develop a realistic model for how Britain should earn its living in a rapidly changing and fragmenting world. Clarity over what we need from our relationship with the EU should emerge from that process.
A "stock-take" and debate of what UK firms lost - and gained, of course - from Brexit and the increased costs they have incurred would be useful. The run-up to the 10th anniversary of the referendum would be good timing.
Thanks Jack. I agree that a stocktake would be very helpful to the debate. But one would need to be careful to define terms. One point that has been made to me a few times recently is that with so much of the commanding heights of our internationally trading sectors now in the hands of foreign-owned multinationals, some of those costs will have been taken at group level as operations were restructured, making it harder to determine firm level costs. This is particularly true in the City for example, with the result that many banks are no longer interested in SM access because they don’t need it. The business has already gone elsewhere.
That’s not a reason not to do what you suggest, just something to be aware of. The famous NBER study that I cited did try to do this using BOE agent data with pretty striking results. But you don’t hear anything about that because the Brexiteers haven’t found a way to refute it!
The constant phrase on numerous platforms forums and edits.
Never a variation. Just that phrase.
Almost as if coordinated.
What exactly does rejoin ‘fix’?
I would like details: because the trade deal we have (and it seems getting with the spf alignment) is pretty much like EU membership.
The issues the UK economy currently have has absolutely no intersection with EU membership and everything to do with a government that consumes around 25% more of expenditure than it did 20 years ago, resulting in ever more tax hikes, shrivelling private sector liquidity, stunted productivity, and inevitably a welfare budget out of all control, whether it be aged related or a vast swath of the unemployed who find it is simpler to embrace a workless lifestyle than work because the benefit to tax ratio is totally off kilter.
None of this has the square root of anything to do with the EU. Homegrown malaise.
Stop with the EU nonsense.
What is absolutely true, and effectively what Brexit promised, is the exposure of the absolute paucity of talent of much of the UK ruling bodies. Helpless to seemingly change anything. No clue. Hapless.
Well that is as Brexit was intended: sooner or later the push comes to shove and the curtain is pulled back and the wheezing relic behind it is exposed for having no ideas.
That is what is needed: not some kind of EU security blanket but the exposure of a lack of basic competence of much of our governance that we can therefore then change by legislation and policy. The absolute reverse of what would happen if embedded in the EU’s baleful orbit.
"Overwhelming case for Rejoin" was my (admittedly) somewhat provocative headline for a long post on UK-EU relations published on Saturday that I think you will find it addresses many of the points you raise. I'm not aware of anyone else using this phrase so if you have been seeing a lot of it, I suspect that is just me trying to persuade people to read it!
Thanks Simon, good point. The extent of foreign ownership is something that, for many years, has not been an issue for policy-makers in the UK anything like as much as it would in other major economies.
The political class is 'indulging in fantasy economics' - sums it all up! and (as I just wrote on your previous post) the UK is badly adrift and ..rapidly sinking. I'll spell it out -it needs someone like you, if not you, to point out the Emperor's new clothes and.. bring the UK back into line!
Thanks Cristina! The revolution starts here on Substack...
Israel (and Saudi Arabia) talked Trump into attacking Iran. But it is rather a stretch to say the Israelis are “stopping Trump from exiting”. Trump’s paralysis runs far deeper and darker than that. He cannot admit to himself that he dragged the US into the worst strategic defeat in its history, just as he cannot admit that he lost the 2020 election. Netanyahu may be nefarious, but he is not Rasputin.
Thanks. Saudi Arabia was actually opposed to the Iran war at the outset, but now that Iran controls the Strait of Hormuz, it is one of those Gulf countries urging Trump to finish the job by reopening it. I think it is pretty well-documented that Israel was instrumental in persuading Trump to start the war and was opposed to the ceasefire (and indeed is continuing to level southern Lebanon), but I agree that the strategic failure is entirely Trump's, which is why he is now lashing out at allies in Europe in a desperate attempt to spread the blame...
Another great read from you—looking forward to more.
Excellent, as ever, thanks Simon. Fantasy economics has settled like a fog over British government for many years, largely undisturbed by serious debate.
I agree that we need to develop a realistic model for how Britain should earn its living in a rapidly changing and fragmenting world. Clarity over what we need from our relationship with the EU should emerge from that process.
A "stock-take" and debate of what UK firms lost - and gained, of course - from Brexit and the increased costs they have incurred would be useful. The run-up to the 10th anniversary of the referendum would be good timing.
Thanks Jack. I agree that a stocktake would be very helpful to the debate. But one would need to be careful to define terms. One point that has been made to me a few times recently is that with so much of the commanding heights of our internationally trading sectors now in the hands of foreign-owned multinationals, some of those costs will have been taken at group level as operations were restructured, making it harder to determine firm level costs. This is particularly true in the City for example, with the result that many banks are no longer interested in SM access because they don’t need it. The business has already gone elsewhere.
That’s not a reason not to do what you suggest, just something to be aware of. The famous NBER study that I cited did try to do this using BOE agent data with pretty striking results. But you don’t hear anything about that because the Brexiteers haven’t found a way to refute it!
Thanks Simon. Incisive and unillusioned. Many thanks.
‘Overwhelming case to rejoin’…..
The constant phrase on numerous platforms forums and edits.
Never a variation. Just that phrase.
Almost as if coordinated.
What exactly does rejoin ‘fix’?
I would like details: because the trade deal we have (and it seems getting with the spf alignment) is pretty much like EU membership.
The issues the UK economy currently have has absolutely no intersection with EU membership and everything to do with a government that consumes around 25% more of expenditure than it did 20 years ago, resulting in ever more tax hikes, shrivelling private sector liquidity, stunted productivity, and inevitably a welfare budget out of all control, whether it be aged related or a vast swath of the unemployed who find it is simpler to embrace a workless lifestyle than work because the benefit to tax ratio is totally off kilter.
None of this has the square root of anything to do with the EU. Homegrown malaise.
Stop with the EU nonsense.
What is absolutely true, and effectively what Brexit promised, is the exposure of the absolute paucity of talent of much of the UK ruling bodies. Helpless to seemingly change anything. No clue. Hapless.
Well that is as Brexit was intended: sooner or later the push comes to shove and the curtain is pulled back and the wheezing relic behind it is exposed for having no ideas.
That is what is needed: not some kind of EU security blanket but the exposure of a lack of basic competence of much of our governance that we can therefore then change by legislation and policy. The absolute reverse of what would happen if embedded in the EU’s baleful orbit.
Some might actually call it democracy.
"Overwhelming case for Rejoin" was my (admittedly) somewhat provocative headline for a long post on UK-EU relations published on Saturday that I think you will find it addresses many of the points you raise. I'm not aware of anyone else using this phrase so if you have been seeing a lot of it, I suspect that is just me trying to persuade people to read it!
Inflation isn’t just “high”.it’s persistent in the wrong categories:
Energy prices remain volatile due to geopolitical tensions (conflicts, supply constraints)
Services inflation (housing, healthcare, wages) is proving structurally sticky
Global fragmentation is weakening the old low-cost supply chain model
The Fed’s 2% target isn’t just symbolic. it’s tied to long-term economic stability and credibility.
The Federal Reserve is balancing two risks:
Cut too early →
Inflation rebounds
Credibility damaged
Hold too long →
Growth slows sharply
Risk of recession increases
Right now, the Fed is signaling:
“We prefer slower growth over losing control of inflation.”
This is not just a policy phase. it’s a regime shift:
From cheap capital → disciplined capital
From liquidity-driven growth → productivity-driven growth
From global efficiency → geopolitical friction
Because U.S. monetary policy is effectively global gravity:
Stock markets, currencies, commodities all adjust around it
Investment flows follow yield differentials
Economic cycles across countries become synchronized.
Inflation isn’t just “high”.it’s persistent in the wrong categories:
Energy prices remain volatile due to geopolitical tensions (conflicts, supply constraints)
Services inflation (housing, healthcare, wages) is proving structurally sticky
Global fragmentation is weakening the old low-cost supply chain model
The Fed’s 2% target isn’t just symbolic. it’s tied to long-term economic stability and credibility.
Thanks Simon, good point. The extent of foreign ownership is something that, for many years, has not been an issue for policy-makers in the UK anything like as much as it would in other major economies.
The 150$ price of oil is quite far off a lot of modelling done at Brookings which seemed quite sound from what I read of it