Is the UK Economy on the Brink of Collapse?
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- เผยแพร่เมื่อ 13 มิ.ย. 2024
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0:00 - 2:00 Intro
2:01 - 5:00 Depreciation of the pound
5:34 - 7:38 Masterworks
7:39 - 9:18 Sanctions
9:19 - 11:50 Inflation crisis
11:51 - 12:46 Tax cuts
12:47 - 14:14 Energy price cap
14:15 - 16:28 Stability and confidence
16:29 - 18:05 Better alternatives
18:06 National leaderboard
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#Economics #uk #liztruss
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Can you make a video about whether Masterworks is a bubble? Cos it kinda seems like it
Yeah, seems a bit bubbly to me
Thumbs down for being payed by and recommending scammers 👎👎
Seems like people plan on dumping once they get all these new people involved
What sets Masterworks apart from NFTs? Sure the art exists in a tangible sense. But what difference does that make really?
To say "the UK isn't having a good year" is a bit of an understatement 😅
Suboptimal
We're in a tad bit of a sticky situation alright, but don't worry I'm sure our next PM will last at least 2 months.
Clearly there are Truss issues especially with Government Bonds.😊
well that’s why there’s a 20 minute video explaining that statement haha
Skill issue
Could the UK kick off the next Eurozone crisis? Having watched the entire video I have no more idea about that than I did at the start, since the Eurozone had nothing beyond a handful of mentions early on suggesting that it faces some of the same problems, but then basically disappeared.
Strange video indeed. The pound falling and sanctions is bc of political issues, not economical, and the inflation, while technically an economical issue, is directly caused by war in Ukraine and post covid issues, which are global problems. I don't really understand what the point of this video is
Eurozone crisis? There is no eurocrisis.
The euro IS the crisis.
this channel Explains nothing, so no surprise.
@@coraltown1 I usually find his videos pretty interesting and well made. This one not so much
Thanks for saving me 20 minutes of my life there.
My son has lived through four chancellors, three home secretaries, two prime ministers and two monarchs.
He's four months old.
I've seen a comments identical to this in a few places. Are you very active or a bot?
I turned 40 earlier this year, and as a Canadian had known no other head of state, or image on our bills and coins.
@@themekfrommars Yeah it's probably horsesh*t but the underlying point still remains.
Did u just steal what someone told Rory Stuart from the rest is politics podcast?
Hey the lettuce beat the new prime minister
The government didn't 'outlaw' energy prices they are paying the difference so the suppliers sell at market rate and buyers buy at the fixed rate.
So they are creating inflation to fight inflation. That's not going to end well...
@@levelupwithsam it's a bad policy but it's better than legally fixing the price as EE wrongly claimed they did
Yes it's a subsidised price cap on consumer utility contracts
@@systemchris the consumer always pays, with more taxation or more federal debt, one way or another, we all end up paying.
@@NenYim I didn't say otherwise.... It's never money from nowhere... It's still in place until April, because it's to prevent people freezing to death in winter, a social cost - imo t'd be better to subsidize the first X kWh of energy with some direct cash so it only subsidizes low usage levels, whilst raising taxes a little bit to spread the recouping of it
If you're going to rerate countries on the leaderboard, can you include the year you did the rating? I.e. after "United Kingdom" add 2022
Good point. In 2032 the UK will most likely be far lower on the list then in 2022.
@@RobinKerkhof Hopefully by then all of the old people who voted Brexit will be gone and the UK can push to join the free market again.
@@Foogle6594 if you join EU, you have to integrate with the EU
@@HUEHUEUHEPony I'm sure you're right your holyness
@@RobinKerkhof probably not, as other countries particularly in Asia will grow massively in GDP, their GDP per capita and stability will remain low while their growth score will likely drop massively, UK will probably stay around where it is
Anyone else sceptical of masterworks given that they advertise so aggressively
It looks like a legit business. They are probably driving an art bubble. Once everyone that wants art shares have invested, or current holders decide they need money for other things, values will drop and they won’t be able to claim such high returns. Meanwhile it makes sense for them to make the most of it
Read the disclaimer and you will see why this can very easily be a scam.
They clearly like Niche TH-cam users.
The whole idea that art is a safe investment in the upcoming (or present?) recession is absurd and since I believe the people behind Masterworks know this (they are not stupid), it is very likely a scam.
There is nothing peak neoliberal capitalism than investing in money to make money or in static art to make money while the infrastructure and normal economy crumbles
Its a pity that this video wasn't released a couple weeks later with how rapidly this situation is developing
Maybe an update wil be posted.
Project fear, things are going well,
@@raymondwebb4179 What how? How in gods name are we doing well.
Future man?
@@MirukuESO the wef may die too
I like the concise analysis. It helps non economists to gain some understanding. One thing I'd like to see is a trend for each of your scoring matrics. This would give a better understanding of where and possibly how to work with the economy in question. Especially for those living in that economy.
This guy is a mouthpiece for neoliberal economics and will go down in history as a shill for this failed and destructive economic system. In other words he is part of the problem and not the solution.
Not sure it is accurate mate. Oversimplified and not even mentioning the key issues that caused cost of living crisis
Artwork is typically a terrible investment but excellent way to launder money so if prices are rising I’m sure there’s a bigger picture.
Pun intended?
I see what you did there.....
Masterworks = NFTs = 💩💩💩
That’s exactly why Masterworks have an icon of washing machine in their very logo
The Chinese billionaire are currently trying to escape china and chairmen winny the Pooh doesn’t want that. So everyone’s being a little hush hush about it.
The problem in the UK at the moment is that; as you said they need to increase taxes and decrease service spending. However, after decades of cutting back, critical services are on the brink of collapse. There is only one option for cuts now which would be to scrap certain services all together. Which would be instant political suicide for any form of governing body.
What about getting money from the super rich to pay for certain services?
I'm sorry when has the NHS ever faced a spending cut?
It depends what services you're talking about. The NHS budget for instance has risen every year for the past 25 years and total government expenditure has steadily risen over the past 20 years or so, from £517 billion in 2005 to about £1 trillion today. Makes one wonder where it all goes.
@@nat1bott wonder how much of this is due to the devaluation of the pound. If you adjust for value against the dollar, you get a 19% raise across 17 years which is below population and inflation growth.
Yeah, there's really nothing left *to* cut by now. Austerity has been the dominant fiscal policy of the UK for the past 50 years.
You know you could work for 40yrs to have $1M in your retirement, meanwhile some people are putting thousands of dollars in a meme coin and now they are multimillionaires.
Most people believe their currency has the worth it does because they have no other option. Even in a hyperinflationary environment, individuals must continue to use their hyperinflationary currency since they likely have minimum access to other currencies or gold/silver coins.
My colleague is increasing his portfolio with Josef Dennis's strategy so i believe and trust it, i can't wait to get my paycheck and buy bitcoin and then start.
SCAM BOTS SCAM BOTS
You guys are funny. Claim to have a money making method yet need external money and are active trying to find new investors. If you are that successfull you don't need investors or participants. You need a loan to scale the investments.
For everyone gaining a million from memecoin investment, there is another one loosing a million
13:35
This is wrong, actually. UK renewables account for 38% of total energy generation, which isn't a small amount, compared to fossil fuels at 42%
The problem is for some inexpicable reason, the "per unit cost" of energy in the UK is pegged on the cost of natural gas. The result of this is previously built green energy like wind and solar (even nuclear) can raise their prices in line with rising gas costs, despite them having ZERO impact on the cost to produce their energy.
This is essentially war profiteering by renewable energy companies and has led to an unreasonably high domestic energy cost in the UK.
People have proposed capping the price of renewable energy, but there has been hard pushback due to fears this would lead to a reduction in green energy investment.
Whether or not that would be the case, the fact that all this green energy HAS NOT saved the UK taxpayer from "paying higher costs relating to fossil fuels" as was promised 10-20 years ago, this goes to show the system is broken fundamentally. Even if the UK was 100% renewable, we would still be paying ridiculous prices.
So yeah, usually EE you're on the ball, but you clearly didn't do your research here. The "oh we need more green energy" argument doesn't fly.
You realize that under normal circumstances, renewable energy is more expensive than fossil? It was never about lowering prices, and everyone who said it'd lower prices was lying from the beginning. It's always been green energy for the sake of green energy. Which is a pretty good reason in and of itself.
They really don'ts seem to have researched the energy bit properly. Just about grasping the stick at the end, this is stimulus for energy producers.
Isn't green energy more expensive because due to the cost of gas being high demand for renewable rise until it matches gas generated electricity? ie the problem is electricity is generated from different sources are interchangeable and this price per kWh will be in line?
Isn't that because gas is the only option to cover peak-power demand? It's certainly odd that residential electric bills would be based on peak marginal costs and not the combined cost of all energy sources, but that doesn't disprove the point that renewable power can't meet peak demand any time soon and marginal fuel costs HAVE risen by an order of magnitude or more this year alone.
@@OzMat It varies from year to year. 2020 it was 43% renewable.
Statistics can be recategorized and plucked from anywhere. It depends what you include, for example your 60% fossil fuel percentage accounts for lifetime assembly of green energy, not just raw production percentage in a year, which is what my number was.
Either way, it doesn't matter. The fact is EE was categorically wrong for trying to imp[ly more green energy would save on costs and that there would be an "artificially low" cost imposed.
When British politics moves so fast that a video posted 40 mins ago, is already out of date 😅
whats happened now? 😅 Im irish trying to understand whats actually going on but its so messy i dont know how to unravel it all
@@jamescanjuggle the PM resigned
@@thespanishinquisition4078 wait again?
@@jamescanjuggle yeah, she lasted 44 days
@@jamescanjuggle there's a pretty comical live stream from the daily Star...will truss outlast a lettuce.
And she didn't...
To my understanding this just proves how much we need an edge as investors because playing the market like everyone else just isn’t good enough. I’ve been quite ensured about investing in this current market and at the same time I feel it’s the best time to get started on the market, what are your thoughts?!
I can’t focus on the long run when I should be retiring in 3yrs ,you see I’ve got a good companies in my portfolio and a good amount invested, but my profits has been stalling, does it mean this unstable market doesn’t provide any calculated risky opportunities to make profits?
It's unfortunate most people don't have such information. I don't really blame people who panic. Lack of information can be a big hurdle. I've been making more than $575k by just investing through an advisor, and I don't have to do much work. Doesn't matter if the economy is misbehaving; great wealth managers will always make returns.
@@ThomasChai05 I've been considering going the same route, could you share more info please on the advisor that guided you to such impressive gains
CAMILLE ALICIA GARCIA maintains an online presence. Just make a simple search for her name online.
Thank you, I just searched for her online, and I'm genuinely impressed with her qualifications. I've already contacted her because I could use all the help I can get.
Can you make a video about how the Mexican peso has not devalued while other major currencies have?
Dominican peso has gain value too
No war, no heating issues ?
😂
This is what 9.25% overnight rate will do to a fella
It’s about to drop about 20%
Disappointed by the masterworks ad, we all know its sort of a scam...
Yup, I get that too need to monetize your channel, but there must be more legitimate sponsors to partner with.
British politics is moving so fast that the video was produced before Truss getting the boot, but also if you update to include that, a week from now it'd also have to be updated again to include whoever comes next, and what the policies will be like. xD
I always kinda knew when Brexit got voted in that UK would go through a phase of high instability... and that was only considering how the country would have to renegotiate everything with and against the EU right afterwards. I wasn't considering a change in monarchy, a revolving door on number 10, the pandemic, the energy crisis, the disruption in global supplies, the war in Ukraine and other factors.
Some of those effects don't matter all that much because it affects the entire world, so everyone is equally going down which brings to parity all other nations anyways, some are even kinda beneficial to the UK due to an expectation of general stability, but some are definitely not great... :P
Right. I supported Brexit and was willing to pay short term for better access to world markets long term. Only to find a pandemic, followed by a war in Ukraine, followed by a change in leadership, followed by China shutting down it's factories, a US president that despises the UK.
No one thought brexit would be easy, but no one thought that the next 6 years would have several world changing events. There is no easy way out of this. A recession would be catastrophic for millions of people, while continuing inflation is also terrible. I think it all comes back to 360bn spent trying to contain a flu.
If you take into account an understanding of the role of 55 Tufton Street in both Brexit and the contents of this government it isn't hard to predict the trajectory of the UK economy. The lunatics are literally running the country and we have proved their free market libertarian economics are an utter failure (just as anyone with any sense knew they would be).
You forgot the demon invasions in the USA
@@bengoacher4455 - in the long run, the recession will be a mere blip. I have lived through several recessions, and they rarely last more than three quarters, unless the govt. screws up and makes it worse. Which is a strong possibility, given the clowns currently in charge. I think we'll get through it, Ben. Like your point about all that £££ blown containing a flu.
@@bengoacher4455 ignoring the world events that were outside of the UKs control, it seems like all the UKs problems are down to bad governance, Brexit guaranteed to be a failure but it needed good politicians.
Considering many many of the reasons people were unhappy and voted for Brexit were as much the problems of bad politics as it was the EU, I'd argue that the UK has been suffering from bad leadership for decades and the consequences of that are all coming to a head. The recent global situations have just hurried things along.
my constipated stomach takes more time to clean up than tenure of UK prime ministers
I'm 58 and my wife and I are VERY worried about our future, gas and food prices rising daily. We have had our savings dwindle with the cost of living into the stratosphere, we are finding it impossible to replace it. We can get by, but cant seem to get ahead. My condolences to anyone retiring in this crisis, 40years nonstop just for a crooked system to take all you worked for.......😪😪
Have you got a second house?
If so, sell it.
Old people with their houses...
@@DukeofTxtspeak you live in a fantasy world where you believe people sit with empty houses lol
Find a low cost country and move there, that is my plan.
@Vido jimenez And hundreds of thousands more have gone BANKRUPT through bitcoin.
(Anecdotally, I know of at least 4 people who have gone bankrupt through bitcoin - and no-one who has achieved financial independence even after 5 years)
@@DukeofTxtspeak Young people and their opinionated "judginess" based on NO FACTS 🙄
Agree with all you said except on the energy point. The energy prices had to be capped or people across the UK would have gone homeless due to the insane prices. It wasn't small rises, it was paying thousands per month without the cap. But the rest I completely agree with.
Then the government should fund and subsidize the energy sector, rather than put caps on the prices and cripple the market
You should look at rest of EU, think Germany is 3-5x cost right now.
@@danirfan5452 the government ARE funding and subsidizing the energy sector.
Yeah. Energy prices were, and still could, crash the real UK economy. Businesses were saying they would shut, and households would go bankrupt.
@@danirfan5452 or just go with the cheaper option and nationalise energy production and distribution. How such a strategic industry, with various characteristics that make it a natural monopoly, is allowed to be operated by private firms is beyond comprehension.
Being in my 30s with no debt and no possible future of having my own family right now the past 2 years have made me look at the expense i would be paying to get a house to "Ahh its pointless to buy one"
Im quite passive in my future thoughts as we cant see it, But i would be lying if i didnt say it makes me feel pretty sad
Don't worry
@@hellomoto1426 be happy
Our generation is seriously disadvantaged. We will be working until we drop dead as our pensions will be worthless, at least compared to the cost of living at the time. Our wages will be flat and our benefits will be slowly eroding to maximise higher profits for the companies we work for. People, couples living in the South-East or London this day and age in my opinion would have household income of at least £80000 (£100000 in London) to be able to comfortably start a family. Livings costs would still be catching up with them every year unless there is a dramatic shift in economic trend.
I'm sorry you feel sad. I'm in a similar position, I'm 30 with no debt, I could be considered lucky since I have a comfortable level of income and ability to save. But a few years ago I realised how much struggle it would be to buy a house, and the level of risk afterwards. It's killed any desire I might have had to start a family so I now think of buying a house as pointless. I don't tend to think much about the future either because things can change but right now it seems like the best option is to live pretty minimalistically and single. I'm mostly okay with that, but I'm sad for those who won't be able to live the lives they hoped for.
I'm 39. No debts but no savings either. No house, no chance of starting a family. I'll be renting forever. life's still fun if you stay healthy physically and spiritually. We are gonna die anyway so I would only have a house for a few decades. Can't take it with me.
Could you do an update on Germany given that we have horrible energy issues right now and energy is at the core of the German model?
Who doesn’t have horrible energy issues in europe? What is there to say?
@@obviouslymatt6452 That's a bit simplistic dude, one size doesn't fit all.
@@obviouslymatt6452 I think Germany are in bigger trouble thank most.
I think it would make more sense to wait for more information on the energy price cap
France is doing reasonably well, nuclear energy is really looking great right now
If I wanted to help billionaires launder money I'd find something more fun that storing art in a freeport.
10:38 "companies produce as much as they can and sell those goods and services to anyone in the ecconomy with the means to buy their product." Not in the absence of competition- 54% of US inflation in the CPI for 2022 was due to increased corporate profits. If you sell food and you sell half the food in the market- guess what, people don't have the option of not buying it at whatever price you set.
Source: ecconomic policy institute
It’s dependent on the elasticity of a good. Medical, food or fuel producers sell and produce in elastic goods and therefore don’t benefit in terms of profit from maximizing production and driving down price
Yh a lot of assumptions that make the free market model sustainable are just patently false.
@@andrelee7081 like?
I looked through the article and it is interesting. I'm not 100% convinced on the conclusions though. You are looking at a transitional period during which (as noted) all costs have been increasing and we are fast approaching recession/depression. It makes sense that responsible companies that are facing rising prices would be cutting back on spending, increasing prices and attempting to build a cash reserve to weather the storm. I suspect these figures will come down considerably as a recession takes hold... and then we'll probably see all the companies that didn't build a reserve go bust or get bailed out.
Wasn’t the energy price cap freeze meant to be the government basically saying “you pay this (2500) and we’ll pay for the rest like what everyone else is doing”?
Yes
No. There is no 'cap'. The cap is a cap on the price per kwh and you still pay for what you use, just at below market rate. If you use twice as much as your neighbor you pay twice as much as your neighbor.
Yeah, it’s guaranteed profits for the energy companies. One important thing to note is that it’s not a cap of £2500 / year, it’s a cap on the unit price (kWh) of electricity and gas. I’ve heard too many tales of people thinking they can blast their heating because the price is capped, not realising that they can absolutely can pay more than £2500.
Nope. They are not paying the rest we are. It is a loan to tax payers that will have to be repaid. It is also a way to keep funnelling money from the public sector into the private. The energy companies are raking in cash due to the high cost of global energy.
@@buzz1ebee guaranteed profits for energy companies? Then what’s your solution?
If I could hit like more than once I would. An unbiased review rather than the endless noise of the British media. Thank you.
I actually feel better after watching that. Thank you and much love from the U.K.
If you want a challange, maybe you could make a video on the merit order efect on energy prices and especially why so many countries used (or are using) the system despite the desaterous consequenses in the current crisis. I think the US is using an "economic dispatch" system, but I#m not really familiar with the US energy market.
Finally a video I've been requesting for ..
Thank you for listening
Liss Truss didn't try to deliver tax cuts because she thought it would be popular (it wasn't from the get go) she did it because she believes in them ideologically.
@@djp3637 true, but the people who voted her in did so because she stated that she would do it, and even co-authored a book about it. She genuinely believed that, even though it would be unpopular with the voters at first, it would make the econony grow so much it would save her.
Great content as always 👏 definitely a must watch for the government 😂
Interesting video, but the problem with economic analysis like this is it doesnt take into account the financial situation on the ground, for everyday people. While the economy may still look strongish, more and more people can barely afford to eat now, so does that really count as being a rich country anymore?
The UK is still a rich country, obviously. If you want an actual non-rich country, may I point you to Sri Lanka?
@@silverhost9782 1 in 7 people in the UK are now skipping meals. (Polling by TUC) It's not even properly cold yet.
In that case the only rich countries are those in the gulf states b/c rn people from Canada to China are really struggling
That's bundled up with the CPI (consumer price increase)
EE did mention it but if you blinked you would have missed it
@Griffith The White Falcon🔧 No we aren't. The fact that you say 'ya'll' is a pretty good indicator that you have no idea what you're talking about here
Love your videos. Can you do some more around the energy caps, LNG, etc and what is likely to help/hurt the economies of the world?
Excellent vid chap
The energy price cap segment was obviously not researched. The cap has been part of our energy market since 2019 and it existed to curb the rampant profiteering off vulnerable people. The cap is calculated by an algorithm based on wholesale costs. This year the wholesale costs were spiraling so badly there were fears of substantial civil unrest over winter, including an attempt to get 1 million households to stop paying for energy at all. The government intervened to lower the consumer side of the cap by promising to pay energy suppliers 100% of the shortfall.
The price is now fixed at well above twice the amount it was a year ago. Although the price cap is stated as an annual bill, implying no household will pay more than that exact figure, it doesn't function this way. It is a cap on the standing charge (a small fee charged daily to those connected to the grid) and the price per unit of energy.
Also, please bear in mind that until about a year ago the price cap was the maximum you would expect to pay, there were always cheaper deals. Now it is the minimum, because there are no cheaper variable rate deals and it doesn't apply to fixed rate deals at all.
The problem with raising taxes and spending less is the spending less part never happens.
This.
And the idea that politicians are willing to bring the pain and “send a strong signal” about curbing inflation is pure camp. They’re going ride the money train into the ground and bail out their special interests until hyperinflation or WWIII.
So all that probably happened was Brit’s got screwed out of a tax cut, and blackrock/vanguard and co. got their guy in as chancellor.
Love your content keep up the good work .
I recommended this channel to all my friends great i love your video.
UK citizen here. The recent month has been crazy with politicians trying all manner of crazy things to keep their jobs.
A general election would be in the interest of the general public but the conservative led government is trying its hardest to not let that happen.
We’re all hoping for the best but it’s not looking great.
The thing is, they don't have to try to not have an election. To get a GE either: the PM has to call one, or the government has to loose a vote of no confidence or otherwise be unable to form a government that can win one... And to loose the VONC there would have to be a lot of tory rebels.
But that won't happen as the one thing that still unites the Tories is that they don't want a GE as they know they would be absolutely hammered in one right now and there's a slim chance that may improve in the next 2 years. And we don't have any mechanism which can force one on them
theres no reason for a GE, a change in PM does not warrant a GE, you have never ever voted for PM, thats not how our gov works, we vote for a party, they choose the party leader. If a GE was called everytime the economy took a downturn youd have daily GE's.
@@v_cpt-phasma_v689 A economic downturn is one thing. This is months of goverment instability and without a mandate.
Edit: That's to say new goverments are being formed with policies vastly different to those that were on the manifesto that got them elected
@@v_cpt-phasma_v689 But we did vote for a manifesto which has been basically abandoned.
@@v_cpt-phasma_v689 You're right, but the current political instability and incredibly poor governance at a time like this is actively damaging the UK's economy, reputation and lives of everyday people. The 2019 election seems like a very long time ago and the world has transformed since then, that mandate given to the conservatives has all but evaporated. It's in the national interest for the conservatives to call a GE but we all know they won't...
Is the full version of national leaderboard available somewhere?
My fav economics channel on youtube
Thanks so much for your videos!!! They are amazing and I learn so much through this TH-cam channel!
could you do a video on a tinyt country? i.e. Estonia. It would be interesting to find out how the rules are different for such micro economies
is there a way to see the full list on the national leaderboard?
Also put ranking numbers next to each entry.
I have been pondering this exact question question for months
Thanks much!
I just purchased discretionary goods at 30% discount over US domestic even after shipping, so it is definitely give and take.
Masterworks, thank you EE, I assume you offer this as financial advice!
Love the explanation. Great video!
Great vid Economics Explained team!
Lettuce for PM
I think the general population would be more on board with the black market energy idea than you think. I'd love seeing kids in school peddling black market energy tactics undermining cooperations 😂
Superb analysis. Got to learn a lot. Thanks
Idea for a future video - showing how countries could move around the leaderboard. The UK over the 20th century could be a good case study in how economic policy and political changes can change these measures. You could show the changing fortunes of other countries - Russia, India, Brazil or whatever at the same time.
2:22 I think Japan really needs clarification. It’s like translating pence to dollars.
Times the value by 100.
I'm going through all you videos and think they are brilliant, I've just finished game theory. Thank you for doing another 1 about my nation hopefully we can sort are problems out. Interesting note as you talked about London homes the most expensive uk home is going back up for sale, owned by the owner of evergrande
He is a mouthpiece for neoliberal economics and will go down in history as a shill for this failed and destructive economic system. Don't be fooled.
is there anyplace I can acutally see that leaderboard?
Some of the older videos just reference a different video for placment and those videos does not seem to exist anywhere. Beside would be nice to acutally see the list in its completness
It’s a made up leaderboard, the author assign the values the way he feels about some characteristics of a country economy and in the end calculate the mean value.
So you don’t need a link for the leaderboard, you can create one yourself.
There always has been price caps in the UK set by Ofgem, which don't strictly work as a cap but more as an average guideline. Even the EU wants to establish an EU-wide one to cope for the winter
Northern Europe and Germany are against an EU price cap.
If the politicians just watched Economics Explained, every country would be prosperous
Why did you decide to not show the 2021 value of gdp? It's perfectly vidible on the world bank site...
You could cap energy prices at a % above the value it was purchased. Lets not forget that pretty much every energy company buys futures/orders 6 or 12 months before they get the product, paying the rate when they purchased the order, not the new value when delivered.
On UK Tax cuts (01:12) Dr. John Cochrane of the Hoover Institution has claimed that that tax cuts were the only method for the UK to avoid the continued slow decline of it's economy. Not saying I agree, but it's not as clear cut as "any high school level economics student would have been able to tell you" (ref: GoodFellows, Hoover Institution, 18/10/2022).
"This was the kind of policy making you would expect from an undeveloped economy with an unstable leadership"
Also known as a conservative government.
I think a video about the Israeli economy could be interesting. I'm biased, but I think it is objectively quite an interesting story and case study of different economic models in the same environment.
This was the first ad I haven't skipped through in a while. Executed very well
masterworks is really sketchy. If the returns sound too good to be true they probably are. Beware
@@caracalfloppa4997 I share your skeptism about masterworks, thanks for the heads up :)
Such educational content, such a genuine host
"...natural economic airbag from deploying." 😂 Enjoying the humor!
That was a very kind assessment of the last few weeks and a generous estimation of the UK's future prospects
Thanks.
Would love to here your thoughts on what Russell Napier is talking about regarding capital ex boom, continued inflation and eventual unemployment.
Your videos are supremely high quality economic analysis. Great work!
Good analysis although I feel there are a few additional points to consider. Namely corruption and its knock-on effect of failed competition policy and the market distortions that creates. With corruption you will not have the proper regulatory environment to mandate free and fair competition. This leads to industry consolidation and therefore cartels and cartel pricing, or price gouging if you will. This effect will be even further amplified if there is cartel pricing for necessary goods and services. This is a huge factor in corrupt oligarchies that is often assiduously overlooked.
Indeed. Best line I've seen is a corrupt society cannot accurately gauge its performance, so any actions it takes is divorced from reality.
Finally an update video on the UK I guess my message finally got through to EE
Incredible - the euro and most if all other currencies have all fallen against the dollar as well
Could you explain the issue with record profits and massive oversupply, to the point that companies are building tons of new warehouses to store all the stuff they aren't selling, matched with record inflation. If the profits are up, the supply is up, shouldn't prices be falling according to basic eccon theory?
No one can explain it because it isn't true.
It's socialist propaganda, used to twist up the uneducated
@@badda_boom8017 No you can look up the numbers, it is true, and you don't need to be a socialist to read a financial report.
The timing of this video was immaculate, Lizz truss has just left and now no one has any idea what's happening. Talk about stability and confidence, theres going to be 3 prime ministers in about 5 months, most likely all with wildly different economic plans. As someone in England, it's so much messier than I've ever remembered. Usually, you only had to check any political news once a week and maybe something interesting would have happened, now, there's always news and speculation on who's actually in charge at any one moment and who will be in the future. I really think that as a country who historically has used it's stability as a strength, with many financial institutions over a hundred years old, if not older, this is not a good luck. We all just want someone boring now, to get back to not having to care about politics because nothing happened.
That will most likely happen after a general election puts labour in power
I believe you need to start attaching timestamps to your index when you made your assessments of a country
Hey, I‘d like your take on Germany‘s Schuldenbremse (translated = debt brake). Our minister of finance is very keen on keeping germany‘s spending above our expenditures.
I‘d love to see your take on how this influences an economy. Especially in times of the eu energy crisis, where subsidies and „giving people money“ are almost mandatory.
As always, keep up the good work:)
Love your channel, but MasterWorks seems to be a bit of a scam in the making
Just a few comments from the ground
when the mini budget was announced, a fair few industry and business associations were actually quite receptive to it. problem was the news of the exchange got plasta allover the media
I agree with your conclusion on the stability and confidence for different reason. the problem is more with the country not able to make up it's mind where to go. In fact, with interest rate rising and the government goes through with tax cut (or at least a pathway or a time table for it) it could be a positive.
I'm quite sceptical on the notion that the tax cut would matter that much to inflation to be honest. I myself would have got an extra 60 quid take home pay which is nice, just about covers the rise of my energy bills and i'm not goig to buy a Farrari any time soon. even tht top rate of 45% would only have brought in about 5billion quid a yr which is like 0.25% of GDP.
As for rising interest rate, I think the BOE is putting off as much as they can. Yeah it's the right thing to do in theory, tell that to my colleague who is remortgaging next january.
I like that you keep saying UK and EU. Depsite the hard line Brexiter and a certain segment on the continent spiting each other across the channel, the UK and EU are closely linked and correalated to each other. Once ppl are done spiting with each other the two sides need to settle down on a relationship and move forward
100% agreed.
Add to that the energy price cap which was desperately needed - inflation or not. The energy priced were not just gonna have people freeze but also economically make thousands of businesses (who have already had rough few years) broke. Across the whole Europe countries are heavily subsidising energy costs because they just have to.
Truss was an awful prime minister (thankfully? shortlived) but it was the constant indecision and uturns on everything more than the initial policy that made her terrible. As EE always points out, stability and confidence is key.
@@TheLukass71 good point I forgot about energy price cap
The companies are charging the market price and customers pay the cap and the government back stop the difference
Yeah, some of the senior leaders in my company were fairly receptive of it (FTSE 100 company). Then there was an absolute deluge of negativity and that was the end of that.
Excellent Masterworks Advert.
Wonderful video! As a portuguese I can't help but notice Lisbon and Porto when talking about "countries that haven't recovered"
This guy is a mouthpiece for neoliberal economics and will go down in history as a shill for this failed and destructive economic system. In other words he is part of the problem and not the solution.
In short: If your people dont have enough money to survive due to economic troubles, dont give them more money.
Make the money they have more valuable.
As a student of economics these videos are so well written. So much economics in such a consumable medium.
As a Brit you missed the key point of the tax cuts, they were 1% for the majority of us (per annum) and therefore negligible. But for people earning over £150,000 this figure grew to 5%. It became quickly apparent that this was a tax cut to benefit only the richest in society, because 1% for someone earning lets say £30,000 is only £300 a year, and considering the pound had fallen to almost parity with the dollar people had on average lost WAAAY more than £300 a year due to the currency devaluation.
Then the now fired Chancellor had the gall to get on TV and argue that this was beneficial for everyone, but the general public were having none of it. One has to wonder, if this really was so beneficial for us, why did no one support it?
I am all for tax increases but if affects lower and middle income houshold less and upper income earners more,which is most of the time not managed.
Please make a video about Japanese Yen 円安. The value of Japanese Yen dropped by over 40% this year, and we are experiencing inflation that’s unfelt in this country for over 30 yrs. Yet our central bank and parliament are still arguing over whether to keep the quantitative easing policy set up by the past pm Abe. Now Taiwan and South Korea has surpassed us in terms of gdp per capita, Japan might become the first developed economy to fall back to a developing one in 21st century😂 btw I think Kishida might have lower support rate than Liz Truss
To be fair, it’s already industrialised with high standards of public transport and manufacturing.
So it might not go down to developing levels
It'll be a portrait of policy in an aged nation, many places in Asia and Europe will be having the same discussions in a decade.
As a Japanophile, I’ve been having a fun last few weeks ordering items from your country ;-)
Not sure if it’s helping your economy any, but the exchange rate makes a lot of stuff I want very appealing :-D
@@pushslice that's a nice way to say weeabo
@@Snoop_Dugg had great public transport and manufacturing to be precise. Just search any video on the evolution of railroad of Hokkaido on TH-cam. Most public transportation agencies in Japan have been running on deficit for decades now
Great video as ever.
IMO many of the tax cuts directed at the rich weren't chosen to be politically popular (in fact, they were unpopular), they were intended to favour "wealth creators", incentivise enterprise etc. The dropped the top rate of tax, removed the cap of banker's bonuses and dropped corporation tax...they would argue that this should incourage investment in the UK, incentivise work and output and lead to growth. It was very ideological (completely misguided). They're radical free marketeers who want to shrink the state, reduce taxes, free up enterise etc. These weren't populist tax cuts
Thanks Lizz 👍
Comparing our economy to Greece was a real wake up call for anyone not 100% familiar with what's going on in the UK atm
I hope this will serve as a warning to politicians in other countries, that you can't just do expansionist fiscal policies when inflation is this high. And that people and markets actually care about sound financial policy.
Here in Denmark, there is a general election and in a debate I saw last week, the right/centre-right politicians were promising tax cuts, while the left/centre-left promised increased spending.
might i make a suggestion for the leader board because economics are always changing wouldn't it be a better idea to have a date like end of year or something similar to calculate all of them at once you could dedicate a whole video to how they have all changed since last calculated
The most effective way to subsidize and decreased demand for utilities is like: No billing if a household uses x units of utility. But if a household uses x+1 units then bill for whole x+1 units.
This measure make sure people who are concerned for power bills in this case will try to keep under x units. And rich wont care.
14:20 The upside down flag shot shows how well the policy worked
I brought US dollar, oil and gas to the EU and europeans and I became european commision president
Of course
11:40 I've never seen this work in the exact way you explain. Purely because I've never seen anyone ever decreasing their prices for anything ever even if they could
Prices increase and decrease all the time in reaction to multiple causes, if they only ever increased, life would be unaffordable very quickly.
Productivity increases in the ecomomy more often cause prices to freeze or increase below inflation as wages become a smaller % share of the price's cost, which means that prices are rising or staying the same but are representing less and less work-hours of a median worker.
I disagree with one thing here. You say to 'let the market decide the price'. However, 'the market', especially the ones involving energy, has long since ceased to function as it should. Cartels, unreasonable profit margins and rampant speculation determine the market price, not supply and demand.
Is the full "National Leaderboard" available to look at? I'm curious how it stacks.
I've been hearing since around 2014 that the next Eurozone crisis will see *a lot* of capital flight to New York and London. Interested to see how it all plays out
Capital flight to London? It's a joke.
@@hoang1730wouldn't be smart to underestimate London or the UK
@@Lando-kx6so clearly everyone overestimated it, which explains the capital outflow out of the UK.
@@porkysharma8423 London always pulls even further ahead of the rest after negative press. Its roots are deep, long, and tacit knowledge is such that it can't be replicated in tiny places like Frankfurt. Then there's the quality of life issue. People just don't want to leave the UK. There is nowhere to go. For most people here, to live full-time, there is nowhere better on Earth. That is why the inflow is always greater than the outflow. London is so many times larger than anywhere in Europe that none of this negativity on London makes nay sense at all. The entire metro area has a $1.7 trillion economy - larger than most countries and it is also the most productive in Europe. The average salary is $77,000. People really say these things without understanding the UK and its history. It never fails.