Re: @localzuk
@localzuk
"Japan has its own issues - decades of stagnating economy. Aging population etc... They have their own crises to deal with."
And yet both had problems with treasury bond liquidity.
"The BoE had to specifically prop up pension funds"
That does seem to be true. After forcing pensions to hold government bonds because they are 'safe' (I think that was Brown?) they had to quickly liquidate what they could to meet so called 'collateral requests'. UK bonds are so safe that they cause a doom spiral at the very time when the BoE has to either fight inflation or a recession after a decade of borrow and spend incontinence and low interest rates. We can choose to do one or the other or get both high inflation and recession. It takes a lot more than 2 weeks to put the country in that position.
"That is not the same as the long running "propping up" of the UK economy since 2008. And your grasp of govt borrowing is slim to say the least. The BoE creates money. It doesn't necessarily have to be paid back. The consequence of creating that money can be increased inflation."
Its not really 'can' cause inflation, it does. More paper chasing fewer things to spend said paper on. And it doesnt have to be paid back, says weimar republic, Hungary, Yugoslavia, Argentina, Venezuela, Zimbabwe, etc.
"However, the inflation we're seeing today is not related to that money - but instead is due to lack of supply of goods due to Covid, Brexit and the Ukraine war."
Not related to that money? So that money had no effect? I cant believe you think that. I would agree the reaction to covid definitely caused severe problems as it reduced supply AND we pumped out even more money leaving much greater demand and killing off or seriously harming supply. The Ukraine war certainly caused problems and is likely to cause further food related issues in future so I hear. Brexit may or may not, no idea as it was lost in the catastrophic decision to cause this situation by our response to covid.
"We have low taxes in comparison with history"
As long as we are selective with history. Good job we have economics to analyse what happened with what effects to give us an idea of good and bad decisions.
"Investment happens when investors feel they can make a profit - regardless of tax levels."
To hold that statement requires an understanding that higher tax reduces what is worth investing in as tax reduces what is profitable. Higher tax, less investment. In an interesting example we have the windfall tax on energy companies we need to invest more in exploration and extraction of fossil fuels. The result of the tax is the very energy companies investing less at a time we need them most.
"If an investor feels they couldn't make a profit due to tax, then their business idea is not good enough to be in this country, simply put"
And under that logic you are happy to reduce investment in this country. So the very supply we need is less important to you than higher tax rates. You seem to agree there is a supply issue so surely we want more investment to increase supply?
"It means they don't think they should pay their fair share for the profits they wish to gain."
There is a reason Brandon is called dementia Joe. 'pay their fair share' is an absolute bull statement that means nothing. There is no 'fair share' its not a number or a value, its a statement used to justify green eyes and stupidity. If you want greater supply then do the things to increase supply (Truss seemed to somewhat understand that). If you are willing to restrict supply to take resources out of the economy for government reallocation then increase tax. Cry that your foot is on the floor after you shoot it off doesnt fix the problem.
"Even the IMF says trickle down doesn't work..."
If the IMF say it doesnt work then it surely must. But it depends what you mean by trickle down. The straw man bull or the factually observed reality.
"The pound plunged dramatically after Truss's govt announced their mini-budget. Other currencies didn't."
Truss announced a pro-growth mini-budget and the pound crashed. Thats not the result of a pro-growth mini-budget, thats the result of the inherited situation. It also didnt help that the BoE didnt raise the interest rate as much as expected.