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Fri, 20th January 2017

Anirudh Sethi Report

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Archives of “Prime Minister of the United Kingdom” Tag

Davos 2017: UK will lead world in free trade after Brexit, says May

UK prime minister Theresa May has said Britain will seek to lead the world in free trade after the Brexit vote as she sought to reassure the global economic elite her government would remain a force for liberalisation and globalisation after the EU referendum.

Addressing the annual World Economic Forum in Davos this morning, Ms May said Britain would “step up to a new leadership role as the strongest, most forceful advocate for free markets and free trade anywhere in the world” as it seeks to strike new trade agreements after the referendum.

Despite seeking to align herself with the Davos crowd, the prime minister also used her speech to rail against a “cult of individualism”, quoting conservative British philosopher Edmund Burke in favouring a pace of change that would still “conserve”, in remarks delivered to a subdued main congress hall.

She added the Brexit vote was a decision to “restore our parliamentary democracy and national self-determination. A vote to take control and make decisions for ourselves”.

PM Modi likely to address nation on New Year eve

Prime Minister Narendra Modi is likely to address the nation on December 31 evening, a day after his 50-day deadline for the completion of the demonetisation process draws to a close. “Prime Minister Narendra Modi is likely to address the nation before dawn of the New Year,” news agency PTI reported.

However, it was not clear as to whether he would address the nation on Friday or Saturday. In his address, the Prime Minister may speak about the roadmap post the demonetisation period especially on the steps likely to be taken to ease cash flow that has been a major problem ever since demonetisation took place.

He may also speak on the steps to deal with the problems the economy faces after the demonetisation was announced on November 8. The Prime Minister in his public meetings in the last few weeks has been urging the people to bear with the pain following the government’s decision and that it would start easing gradually once the 50-day period is over. On Tuesday, Modi met economists and experts at a meeting in Niti Aayog to discuss the current economic situation

British PM warns MPs against blocking Brexit

British Prime Minister Theresa May warned lawmakers on Sunday not to block Brexit, after the High Court ruled that she cannot start the process of leaving the European Union without parliament’s approval.

The Conservative government has said it will appeal Thursday’s court decision and May told EU leaders on Friday that she believes she has a strong case.

But in a statement published ahead of a trade mission to India, May cautioned members of parliament against using the ruling to undermine the result of the June referendum.

“The result was clear. It was legitimate. MPs and peers who regret the referendum result need to accept what the people decided,” she said.

Supporters of Brexit responded angrily to the court’s decision, amid speculation that pro-European lawmakers would seek to water down the break with the EU and derail May’s plans to begin formal exit talks by the end of March.

“Now we need to turn our minds to how we get the best outcome for our country,” the prime minister said.

This Week Eyes on 4 Events

Of the forces driving prices in the week ahead, events appear more important than economic reports.   There are four such events that investors must navigate.  The Bank of Canada and the European Central Bank meet.  The UK High Court will deliver its ruling on the role of Parliament in Brexit.  The rating agency DBRS updates its credit rating for Portugal.
The Bank of Canada is not going to change interest rates.  Still, growth has disappointed, and price pressures appear to be ebbing.  It will take longer than the BoC is currently anticipating to close the output gap.  It may adjust its forecasts accordingly.  In addition, the recent use of macro-prudential policies to address housing market activity eases one of the inhibitions for a rate cut.  The market is currently pricing in about a one in 20 chance of this materializing next year.
The risk may be somewhat greater than that  In part, there seems to be too much made of the trade-off between the fiscal stimulus and monetary easing.  It is so pre-crisis.  This week’s data is likely to show that CPI continues to moderate and, despite the launch of a new low-income family benefits program, retail sales like fell in August, and the risk is on the downside of the median forecast of -0.1%.
It does not appear that the ECB is prepared to announce a decision about whether it will extend its asset purchases after the current soft end date of March 2017, or about how it will address the potential scarcity of particular securities.  Although we thought there was an opportunity to do so last month, it now seems more likely that the ECB will make its decision at the December meeting.

Article 50 “Perfectly Timed” For Turmoil

Labour spin doctor, Alastair Campbell Slammed the Prime Minister for Revealing the Article 50 Timing. Others have done the same.

Timing of the article 50 announcement, by March 2017, is ahead of French and German elections. Politicians will have elections, not Brexit on their minds.

Many blame Theresa May because it will take time off the negotiations.

Politically speaking, May knows precisely what she is doing.

hose who think otherwise, need to consider how well she has rounded up support in many quarters by offering something to everyone: UK Prime Minister Attacks QE, Irresponsible Capitalism, Tax-Dodging Companies.

The date was carefully timed, precisely to put pressure on Angela Merkel by German car manufacturers (European car manufacturers and businesses in general), telling Merkel to go easy.

Brexit puts 71,000 jobs, £10bn in tax revenues at stake — report

Image result for BrexitAround £10bn in tax revenues and 71,000 jobs hinge on the outcome of the UK’s exit negotiations with the EU, according to fresh data on the potential impact of Brexit to the financial-services sector and to the wider economy.

A new report due to be published on Wednesday by Oliver Wyman, the consultants, concludes that the UK may only lose £0.5bn a year in tax revenues and 4,000 jobs — both around 1 per cent of the current respective totals — if the UK can secure similar access to the single market as it currently enjoys

However, those figures plunge at a worst-case scenario — described by its authors as “conservative”, as it does not take into account the wider effects such a loss would have on the wider economy as sacked bankers cut back.

In the report, published by CityUK, the lobby group that argued for a Remain vote prior to the referendum, a “hard” Brexit where there are severe restrictions on the UK’s ability to trade with the rest of the EU would result in 35,000 financial-services jobs being at risk, along with as much as £5bn in revenue that would otherwise end up in the Treasury’s coffers.

When will Rs 15 lakh be in my account? RTI applicant asks PMO

The Prime Minister’s Office has been directed by the CIC to respond to an RTI applicant who sought to know when will Rs 15 lakh, as promised by Narendra Modi during 2014 General Elections, be deposited in his account.

The direction came in connection with the plea by one Kanhaiya Lal from Jhalawar district of Rajasthan who had filed an RTI application with the PMO seeking to know the status of his representation to Prime Minister Narendra Modi.

Among other details mentioned in the representation sent to the PMO, Chief Information Commissioner Radha Krishna Mathur noted that Lal had also asked the top office that “at the time of election, it was announced that black money will be brought back to India and Rs 15 lakh will be deposited in the account of each poor, the complainant wants to know what happened to that.”

Citing the plea of Lal, Mathur noted, “the complainant wants an answer from the Hon’ble Prime Minister that it was announced during the election that corruption will be removed from the country but it has ‘increased to 90 per cent’ and wants to know when the new law will be made for the removal of corruption from the country.”

P Chidambaram’s Brexit lessons for PM Narendra Modi, BJP

The people of the United Kingdom (UK) have decided to leave the European Union (EU). More accurately, a divided people of a disunited kingdom have voted by a majority of less than 4% to quit a Union they had joined 43 years ago.

Scotland, Northern Ireland and London were on one side of the divide while England and Wales were on the other.

Most young people voted to ‘remain’ while most older people voted to ‘leave’.

The vote to leave may not unravel the European Union but it threatens to unravel the United Kingdom and has raised the question ‘Why did Prime Minister Cameron decide to hold a referendum?’

Losing support

The UK is a parliamentary democracy, not a plebiscitary democracy. Policies and laws are made by Parliament, not by the people directly. Mr Cameron gambled on a referendum to quell an internal rebellion within the Conservative party and failed. The cardinal rule of politics is that ‘never call a referendum (or a vote) unless you are certain that the outcome will be in your favour’. Mr Cameron violated the rule. Why? Because he assumed, like many elected leaders, that since he enjoyed the support of a majority in Parliament he enjoyed the support of a majority of the people as well. That was a fatal mistake.

The people’s vote is defined by the time and the context of the vote. But times change, the context also may change.

The majority that a leader won in a parliamentary election will endure for the duration of the term, but the leader may have lost the support of the people at large.

The leader may indeed be standing where he stood, but the ground may have shifted under his feet. Most prime ministers are loath to accept the fact that they may have lost the support of the people—at least on some crucial issues.

Mr Cameron miscalculated his support on issues such as immigration, jobs and multi-culturalism. He was absolutely right in taking the position—as any decent, thinking man would—that Britain was a better country because it was multicultural; that jobs that the British people did not want to do had to be done by someone and the immigrants were willing to do those jobs; and that being part of the EU, despite the obtrusive and oppressive bureaucracy in Brussels, was good for the British economy. Many people thought like Mr Cameron, but many more thought otherwise.

As a result of the vote taken on June 23, British politics has imploded. The UK is effectively without a Prime Minister and without a Leader of the Opposition.

31% vs 69%

Home Secretary Theresa May -No second Brexit vote, no general election until 2020

Home Secretary Theresa May has said there should be no general election in the UK until 2020, as she launched her bid for the Conservative Party leadership to replace David Cameron as Prime Minister.

Ms May also stressed that there should not be another referendum on Britain’s position in Europe following the result of last week’s vote. Speaking in London she said:

Brexit means Brexit. The campaign was fought, the vote was held, tuyrnout was high and the public gave their verdict. There must be no attempts to remain within the EU…and no second referendum

There should be no general election until 2010

“Brexit” – What Goldman Thinks Will Happen Next, And Who Will Hold The Next Referendum

Considering Goldman’s abysmal forecasting track record continues to plumb new lows (just today it predicted a Spain victory of Italy, and an England victory over Iceland, both tragically wrong), the following should perhaps be best used as an indicator of what will not happen. Still, since there are a lot of remaining Brexit question, we hope that the following at least provides a useful framework for how to approach the :”known unknowns”, if not so much the unknown unknown ones.

First, here is Goldman’s answer on what happens next, in terms of timeline of key events, as well as bookmaker odds for the next conservative party leader.

 

Some points from Goldman here: