British Prime Minister Liz Truss and Chancellor of the Exchequer Kwasi Kwarteng visit Berkeley Modular in Kent on Friday. AP Photo
British Prime Minister Liz Truss and Chancellor of the Exchequer Kwasi Kwarteng visit Berkeley Modular in Kent on Friday. AP Photo
British Prime Minister Liz Truss and Chancellor of the Exchequer Kwasi Kwarteng visit Berkeley Modular in Kent on Friday. AP Photo
British Prime Minister Liz Truss and Chancellor of the Exchequer Kwasi Kwarteng visit Berkeley Modular in Kent on Friday. AP Photo


Failure of the pound shows Truss will have to be as tough as Thatcher


  • English
  • Arabic

September 26, 2022

There are many reasons to hope that new UK Prime Minister Liz Truss makes a success of her time in office, not least that she is a rare example of the forgotten Generation X taking power.

The gamble Ms Truss is taking with the British economy – slashing taxes, increasing government borrowing and stimulating the housing market – are a hard tilt against an economic downturn and rising interest rates. “Trussonomics”, as it has been dubbed, puts Britain very vividly out on a limb against the G7 economic consensus at a time when the uplift in the US dollar is anyway crushing its big partner currencies, such as the yen, euro and renminbi.

The first few days of a Truss government marks a sharp departure from the path Conservative-led governments pursued in the UK since taking power in 2010 and an audacious attempt to bring about change.

The pound reacted terribly with a crash below $1.10 for the first time since 1985 last week. The experts have been damning. Larry Summers, the former US Treasury secretary, was not alone in alluding to banana republic status for the UK.

“It makes me very sorry to say, but I think the UK is behaving a bit like an emerging market turning itself into a submerging market,” he remarked. “Between Brexit, how far the Bank of England got behind the curve and now these fiscal policies, I think Britain will be remembered for having pursued the worst macroeconomic policies of any major country in a long time.”

Mr Summers cut his teeth fighting “voodoo economics” (or “Reaganomics”, or the Laffer Curve theory) that ran this same playbook in the US in the 1980s. As a resident of the UK, I have every reason at this stage to be braced for anything to happen. The pound was more or less pinned at $1.35 at the start of the year. Just six years and some months ago, it was touching the $1.50 mark.

For more than three full decades, the Thatcherite message has been lost in a different set of economic conditions

Here’s where the generational point is important to understand how convictional this is for the new UK leader – and, thus, why it matters at this point for the global economy.

Generation X has been largely excluded from power by the Baby Boomers, which include former leaders such as Barack Obama and Boris Johnson. Politicians like Ms Truss were absolutely formed by the 1980s – and in the UK, by the deep-running battles and trenchant nature of politics under former prime minister Margaret Thatcher. Having studied economics in the early 1990s, Ms Truss would have also had the formative foundation of how the monetarist experiment worked in the previous two decades.

For more than three full decades, the Thatcherite message has been lost in a different set of economic conditions. Now, the underlying economics have gone back to how it was when Ms Truss was growing up. That is why the new leader is moving so purposefully to establish her approach. In doing this, she is establishing her bond with British voters in the same month that she took office.

The coming winter in the UK is set to be marked by a monumental energy crisis. The package announced by Ms Truss and her finance minister, Kwasi Kwarteng, last week represents a bulwark to get through the backlash. As she said on taking office, Ms Truss survives if she can rescue the UK from the onsetting storm. The National Institute of Economic and Social Research on Friday forecast that her tax cuts and energy crisis decisions would lead to positive growth in gross domestic product in the fourth quarter of this year, shortening the recession and raising annual GDP growth to about 2 per cent over 2023 to 2024.

British Prime Minister Margaret Thatcher tries her hand with a television camera in London in 1987. AP Photo
British Prime Minister Margaret Thatcher tries her hand with a television camera in London in 1987. AP Photo

Yet, the markets are in meltdown. This is because economists have stopped using the monetarist models and the idea that the cost of money rising to 8 per cent is outside the practical day-to-day experience of most working-age people in the West. There is no theory-based reason why that world could not re-emerge. Ms Truss has set course and, as Thatcher’s famous phrase had it, “the lady's not for turning”.

This means that something quite abnormal is going to unfold in the UK following the decisions of last week. You have to go back to the early 1990s for a contest so raw between a government and the financial markets.

One radical thought is that Ms Truss is not really bucking history but moving faster than others to address the conditions that are forcing the new economic malaise.

Recessionary forces are ripping. The money supply in the developed economies has already shrunk. Due to a lag in data, the price of money in the form of interest rates is going up, tightening yet further.

Using the tools of taxes to reverse these effects on growth is perfectly legitimate. What is more iffy about her policies is the reformist language she uses. Every right-leaning politician, and a good few on the left, have promised a bonfire of regulation for decades without making much difference.

Ms Truss has the chance to show that, what Generation X took from their childhood and academic experience, was a solid lesson that the Thatcherite approach can work. Most especially when all else has failed.

The British in India: Three Centuries of Ambition and Experience

by David Gilmour

Allen Lane

Paris Can Wait
Dir: Eleanor Coppola
Starring: Alec Baldwin, Diane Lane, Arnaud Viard
Two stars

Results

4pm: Al Bastakiya – Listed (TB) $150,000 (Dirt) 1,900m; Winner: Panadol, Mickael Barzalona (jockey), Salem bin Ghadayer (trainer)

4.35pm: Dubai City Of Gold – Group 2 (TB) $228,000 (Turf) 2,410m; Winner: Walton Street, William Buick, Charlie Appleby

5.10pm: Mahab Al Shimaal – Group 3 (TB) $228,000 (D) 1,200m; Winner: Canvassed, Pat Dobbs, Doug Watson

5.45pm: Burj Nahaar – Group 3 (TB) $228,000 (D) 1,600m; Winner: Midnight Sands, Pat Dobbs, Doug Watson

6.20pm: Jebel Hatta – Group 1 (TB) $260,000 (T) 1,800m; Winner: Lord Glitters, Daniel Tudhope, David O’Meara

6.55pm: Al Maktoum Challenge Round-1 – Group 1 (TB) $390,000 (D) 2,000m; Winner: Salute The Soldier, Adrie de Vries, Fawzi Nass

7.30pm: Nad Al Sheba – Group 3 (TB) $228,000 (T) 1,200m; Winner: Final Song, Frankie Dettori, Saeed bin Suroor

21 Lessons for the 21st Century

Yuval Noah Harari, Jonathan Cape
 

Founders: Ines Mena, Claudia Ribas, Simona Agolini, Nourhan Hassan and Therese Hundt

Date started: January 2017, app launched November 2017

Based: Dubai, UAE

Sector: Private/Retail/Leisure

Number of Employees: 18 employees, including full-time and flexible workers

Funding stage and size: Seed round completed Q4 2019 - $1m raised

Funders: Oman Technology Fund, 500 Startups, Vision Ventures, Seedstars, Mindshift Capital, Delta Partners Ventures, with support from the OQAL Angel Investor Network and UAE Business Angels

Key facilities
  • Olympic-size swimming pool with a split bulkhead for multi-use configurations, including water polo and 50m/25m training lanes
  • Premier League-standard football pitch
  • 400m Olympic running track
  • NBA-spec basketball court with auditorium
  • 600-seat auditorium
  • Spaces for historical and cultural exploration
  • An elevated football field that doubles as a helipad
  • Specialist robotics and science laboratories
  • AR and VR-enabled learning centres
  • Disruption Lab and Research Centre for developing entrepreneurial skills
Pieces of Her

Stars: Toni Collette, Bella Heathcote, David Wenham, Omari Hardwick   

Director: Minkie Spiro

Rating:2/5

Abramovich London

A Kensington Palace Gardens house with 15 bedrooms is valued at more than £150 million.

A three-storey penthouse at Chelsea Waterfront bought for £22 million.

Steel company Evraz drops more than 10 per cent in trading after UK officials said it was potentially supplying the Russian military.

Sale of Chelsea Football Club is now impossible.

The%20trailblazers
%3Cp%3ESixteen%20boys%20and%2015%20girls%20have%20gone%20on%20from%20Go-Pro%20Academy%20in%20Dubai%20to%20either%20professional%20contracts%20abroad%20or%20scholarships%20in%20the%20United%20States.%20Here%20are%20two%20of%20the%20most%20prominent.%0D%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3EGeorgia%20Gibson%20(Newcastle%20United)%3C%2Fstrong%3E%0D%3Cbr%3EThe%20reason%20the%20academy%20in%20Dubai%20first%20set%20up%20a%20girls%E2%80%99%20programme%20was%20to%20help%20Gibson%20reach%20her%20potential.%20Now%20she%20plays%20professionally%20for%20Newcastle%20United%20in%20the%20UK.%0D%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3EMackenzie%20Hunt%20(Everton)%3C%2Fstrong%3E%0D%3Cbr%3EAttended%20DESS%20in%20Dubai%2C%20before%20heading%20to%20the%20UK%20to%20join%20Everton%20full%20time%20as%20a%20teenager.%20He%20was%20on%20the%20bench%20for%20the%20first%20team%20as%20recently%20as%20their%20fixture%20against%20Brighton%20on%20February%2024.%0D%3C%2Fp%3E%0A
The specs
  • Engine: 3.9-litre twin-turbo V8
  • Power: 640hp
  • Torque: 760nm
  • On sale: 2026
  • Price: Not announced yet
UAE currency: the story behind the money in your pockets
JERSEY INFO

Red Jersey
General Classification: worn daily, starting from Stage 2, by the leader of the General Classification by time.
Green Jersey
Points Classification: worn daily, starting from Stage 2, by the fastest sprinter, who has obtained the best positions in each stage and intermediate sprints.
White Jersey
Young Rider Classification: worn daily, starting from Stage 2, by the best young rider born after January 1, 1995 in the overall classification by time (U25).
Black Jersey
Intermediate Sprint Classification: worn daily, starting from Stage 2, by the rider who has gained the most Intermediate Sprint Points.

RESULTS

West Asia Premiership

Thursday
Jebel Ali Dragons 13-34 Dubai Exiles

Friday
Dubai Knights Eagles 16-27 Dubai Tigers

Mina Cup winners

Under 12 – Minerva Academy

Under 14 – Unam Pumas

Under 16 – Fursan Hispania

Under 18 – Madenat

One-off T20 International: UAE v Australia

When: Monday, October 22, 2pm start

Where: Abu Dhabi Cricket, Oval 1

Tickets: Admission is free

Australia squad: Aaron Finch (captain), Mitch Marsh, Alex Carey, Ashton Agar, Nathan Coulter-Nile, Chris Lynn, Nathan Lyon, Glenn Maxwell, Ben McDermott, Darcy Short, Billy Stanlake, Mitchell Starc, Andrew Tye, Adam Zampa, Peter Siddle

If you go

The flights

There are direct flights from Dubai to Sofia with FlyDubai (www.flydubai.com) and Wizz Air (www.wizzair.com), from Dh1,164 and Dh822 return including taxes, respectively.

The trip

Plovdiv is 150km from Sofia, with an hourly bus service taking around 2 hours and costing $16 (Dh58). The Rhodopes can be reached from Sofia in between 2-4hours.

The trip was organised by Bulguides (www.bulguides.com), which organises guided trips throughout Bulgaria. Guiding, accommodation, food and transfers from Plovdiv to the mountains and back costs around 170 USD for a four-day, three-night trip.

 

Gothia Cup 2025

4,872 matches 

1,942 teams

116 pitches

76 nations

26 UAE teams

15 Lebanese teams

2 Kuwaiti teams

Our legal consultant

Name: Hassan Mohsen Elhais

Position: legal consultant with Al Rowaad Advocates and Legal Consultants.

Updated: September 26, 2022, 4:00 AM`