Matthew Lynn

Critics of Argentina's president Javier Milei have already made up their minds: he is a lunatic and his plans will collapse on first contact with the real world. Argentina's money will run out and the economy will grind to a halt. To some commentators, he is a ‘hard-right’ ideologue who will crash the economy within weeks. They say he's like Liz Truss and Kwasi Kwarteng on roller-skates. If you listen to those attacking Milei, you'd be forgiven for thinking the man in charge in Buenos Aires will precipitate yet another economic calamity in a country which has been stumbling from one disaster to another for almost a hundred years. But hold on. It turns out that the markets don’t quite see it like that.

When Jeremy Hunt takes to his feet in the Commons this afternoon to deliver his Autumn Statement, he'll be trying to woo voters with some tax 'giveaways': VAT thresholds might be raised to help small businesses and the basic rate of National Insurance could be reduced for the rest of us. But hold on. Before the Chancellor gives anything back, both he and the Prime Minister Rishi Sunak need to do something far more important: they should apologise for all the tax rises the Tories have imposed. We don’t know the final figure yet, but it turns out that the Chancellor has around £13 billion to £15 billion of ‘headroom’, as the fiscal jargon has it, to cut taxes.

At least there will be some pandas. At his summit with President Biden this week, China’s President Xi pledged to send more cuddly bears to the US, the traditional Chinese way of cementing good relations with other countries. More importantly, there was a significant easing of tensions between the two largest economies in the world. Military communications will resume, reducing the chances of a catastrophic miscalculation between the two nations, controls on narcotics will be tightened up, and there will be a resumption of high-level diplomatic contacts. It remains to be seen if that sticks. But if it does, one point is surely clear. That could yield a huge ‘peace dividend’ for the global economy.

It runs a vast budget deficit. It keeps raising taxes way above its neighbour. It spends wildly, it is at war with its major industry, and its former leader has been arrested over an investigation into missing party funds. But, heck, never mind about that. Humza Yousaf, the leader of the Scottish National Party, has just decided the bond markets will now have the privilege of ignoring Switzerland and Norway for a few days and can lend a few billion to Scotland instead. There is just a small problem, however. Why would anyone want to lend money to Humza?  It was certainly an ambitious proposal. In his conference speech, Humza Yousaf announced plans to tap the bond markets directly.

The timing could hardly have been better. Other Labour leaders and shadow chancellors have had to make do with endorsements from the drummer in a 90s Britpop band, or a runner up for the Booker Prize. Rachel Reeves, however, rounded off her speech to the Labour party conference today with no one other than the former Governor of the Bank of England Mark Carney singing her praises. But hold on. Isn't Carney starting to abuse his position – and possibly the Bank's independence as well?  By taking sides so openly Carney is turning the Bank into a political body At least we know who Carney would be voting for if he happened to still be in the country. 'Rachel Reeves is a serious economist,' he told delegates at the conference in a video message.

There are lots of plausible explanations for Dame Sharon White’s failure at the department store and grocery chain John Lewis. The retail environment was too tough. Her predecessor expanded too quickly. During a cost–of-living crisis and with the shift to online shopping it was always going to be a very tough gig. Yet once you look a little deeper, the real explanation is this: the quango-cracy, of which she was a leading member, is useless at running a real business. With her early resignation today, Dame Sharon has, to her credit, recognised a fact that was already painfully obvious to everyone else. Put simply, she was not up to the task of turning around John Lewis, and it would be far better for someone with more experience of rescuing failing retailers to take over.

Bond yields are soaring. The cost of debt, and very soon mortgages, is rising. And the government is getting nervous about how it is going to borrow the next ten or twenty billion. This might sound like the opening of a one-year-on post-mortem of Liz Truss’s ill-fated mini-Budget (we have all been treated to those recently). But in fact, it is a description of what is happening right now across Europe. The eurozone is facing its Liz Truss moment, and the results are likely to be every bit as catastrophic.  Across Europe the bond markets are starting to look jittery. Over the last couple of days, the yield on ten-year Italian bonds has risen to 4.

The Office for Budget Responsibility (OBR) will have to sign off on any changes to taxation. It will need to run its slide rule over any spending plans. And it will be mandated to commission an independent panel of experts to approve the Chancellor’s lunch, checking it for nutritional standards, and competitive pricing.  Okay, it is possible that I made that last one up. But the rest are right: the Labour party has just promised to vastly increase the powers of the OBR, allowing it to scrutinise the government machine in minute detail. In effect, it will surrender control of its economic programme to the same grey bean-counters who have already failed Britain – and that will condemn the country to five more years of dismal stagnation.

He was a ‘global superstar’. He was the smartest finance official of his generation. He would bring global contacts and experience. When Mark Carney was appointed as the first foreigner to run the Bank of England he was meant to be a refreshing, technocratic figure who would blow some of the cobwebs off the institution. And yet, with his attack on Liz Truss for creating ‘Argentina on the Channel’, Carney has become a disgrace to the Bank. No former governor should ever be so openly partisan. Indeed, if anyone imposed Argentinian-style monetary policies it was possibly Carney himself. It is unheard of for a former governor of the Bank of England to be so openly partisan There was no mistaking the ferocity of the attack.

When the iPhone 15 is unveiled later today it will no doubt come with an array of flashy tweaks and upgrades. It may be slightly lighter, the camera might be better, and it could even have a slightly better battery life. But the really big change will be something mundane: its charging port. The European Union has forced Apple to adopt the same USB-C charger that is standard on Android and many other devices. New EU rules require all phones sold after autumn 2024 to use this connector for their charging ports. As a result, Apple has reluctantly decided to bin its lightning charger after 11 years and make the USB-C charging port standard around the world. But hold on. Does the EU really know how smartphones should be designed?

Over mighty trade unions. Short-termist management that prioritises profits over investment. And an education system that doesn’t produce enough scientists or engineers. There have been many different versions of the ‘British disease’ over the years to explain the consistent under-performance of our economy compared to some of our main rivals. But right now there is a new one: the British don’t want to go back to the office – and that is hitting output hard.  According to a survey by the consultancy AWA published this week, the British are more reluctant to go back to the office than workers in almost any other major developed country. Even as bosses plead with them to go back in, the average office worker in this country is only showing up at their office 1.

It will be harder to pick up a last-minute light bulb. You might have to rely on Amazon Prime for a quick delivery of new tea towels. And your local shopping centre will look even more dismally empty than it already does.  There will, in fairness, be some disadvantages to the hardware chain Wilko disappearing. And yet there is no point in pretending that it is any great loss. In reality, it was one of many ‘zombie’ companies, kept alive by artificially low interest rates. Now that capital costs money again, many more will go bust.  Wilko announced today that it was going into administration, and that its 400 stores are now likely to close, with the potential loss of 12,000 jobs. The chain had been looking for a savior for months.

Small companies will face massive fines for not checking the papers of everyone they hire. Landlords will be put out of business for renting rooms to anyone without permission to be in the UK. With its Rwanda policy stalled, and with the numbers of illegal immigrants still at record highs, the government has a big new idea for trying to stem the numbers of people coming into the country. It will get small businesses to police the system. The only trouble is, that will damage the economy, and we will all suffer from that.  The government’s latest big idea for controlling immigration is to make it a lot harder for anyone who is here illegally to work or find somewhere to live.