Daily Brief – Autumn Statement

Autumn Statement

Trailing some prospective budget measures ahead of the UK Budget is as old as well, the UK Budget. Chancellor Reeves would do well to look up the TB/GB(Tony Blair/Gordon Brown) playbook from 1997-2008 which was a masterclass in the dangle, the tease and the test. Chancellor Reeves a good 5 weeks ahead of her Autumn Statement has splashed a series of prospective measures with a leaden lack of surefootedness that have one thing in common: they have all bombed. At this point she has 3 choices: go quiet and get her Treasury team to tear up the bad ideas; find some better ones, or go for the full Liz Truss/Kwasi Kwarteng big surprise. We know where the last one went so that is probably (not definitely) not going to happen. The Reeves record on good ideas is somewhere between sparse and negligible so we can rule that one out too. That leaves the first one, and if it is not too late for Chancellor Reeves to get a grip quickly, even the glacially slow moving Prime Minister will be forced to make a change to the team sheet.

GBP/USD 1.3352.

Internet Outage

More than enough has been written about the Amazon Web Services data centre in Northern Virginia that caused chaos worldwide to the internet when it went down earlier this week, but it is worth looking at the thinking that places power and water hungry data centres needed to train and run AI systems in regions that are not properly prepared for them. The beguiling cocktail of jobs, and prosperity will emanate from the location of those data centres has been enough for planners to wave through applications in areas in all countries but include Mexico, Chile, and Ireland. Typically, the areas approved for those new data centres are underpopulated and poor and consequently have not required much in the way of power and water, so inevitably when the data centres are commissioned, the strain on those resources is unbearable and they break down. So belatedly, its back to the drawing board: power and water infrastructure investment must be committed and in place before data centres are green lit.

GBP/EUR 1.1502.

Mighty USA

A helpful reminder bar chart from the IMF this week showing the population of the USA at 342 million and its GDP of USD 30.51 trillion.

Opposite in the chart are the following countries: Russia, Brazil, Canada, Italy, France, UK, Japan, India, and Germany. The total population of those countries is 2,333 million and the collective GDP 29.03 trillion.

 EUR/USD 1.1603.

Power Train

Double decker trains on the London-Paris Eurostar service will mean not only good views of the French countryside from the top deck of the new trains but also enhanced capacity with each 400 meter train (2x200meter trains linked) carrying a max of 1080 passengers. By some Anglo-French engineering feat, French train maker Alstom has managed to design the new trains to be just 16cm higher than the current rolling stock which means that they will be able to pass through and under the English and French tunnels and bridges. Eurostar announced in June that it is expanding its network so in future trains will depart from St Pancras direct to Frankfurt and Geneva as well as Amsterdam and Brussels.

EUR/JPY 177.01.

You Can’t Always Get What You Want

This day in 1977, Keith Richards of the Rolling Stones amply demonstrated that the life of a rock n’ roll legend does not always go smoothly. Having achieved financial success, more than his fair share of critical acclaim and a number of properties in West Sussex and Chelsea in London, Keith Richards found himself in court charged with possession of cannabis, Mandrax tablets, Chinese Heroin, and a revolver as part of the smorgasbord of entertainment on offer at his Chelsea home. Having pleaded guilty and agreed to pay the fine of GBP205, KR and his girlfriend, German muse and model Anita Pallenberg, sought refuge from the voracious press pack by repairing to a London hotel where in keeping with their rock n’ roll lifestyle they managed to set their room on fire. Just what passes as a normal day for Keith Richards.

And I saw her today at the reception
And glass of wine in her hand
I knew she was gonna meet her connection
At her feet was a footloose man
Okay, guys

Now you can’t (always get what you want) yeah
Now you can’t (always get what you want)
Now you can’t (always get what you want) yeah
And if you try sometimes, you just might find
You get what you need
Baby, yeah

And I went down to the demonstration
To get my fair share of abuse
Singing “We’re gonna vent our frustrations
And if we don’t we’re gonna blow a 50-amp fuse”
Come on, gals

You can’t always get what you want

Have a Great Weekend!

Discussion and Analysis by Humphrey Percy, Chairman and Founder

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