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Labour’s general election plan on Brexit- it looks as though the fudge will continue

September 22nd, 2019

Surely a clear position is required?

As well as the side shows of the move against Watson that were pulled and the top Corbyn advisor who has quit the the big story about behind the secenes in Brighton appears to have been the policy, or non-policy, on Brexit.

We know where Johnson’s Tories stand and Swinson’s LDs but if you are looking for clarity from what is currently the official opposition then you are probably going to be disappointed.

Somewhat naively I was expecting that the impending general election would focus minds amongst the red team and that they’d come out for Remain while at the same time having a good bash against the Tories for their no deal threats and against the LDs for their revoke now without a new referendum plan.

So many GE2017 LAB voters, up a quarter according to the polling, have now switched to the LDs that that surely was going to provoke a response. You can’t go into elections without such a large slice of your support base.

Well it looks as though I’ll be wrong. As I write at 3.45pm the leadership’s plan is to go into the general election without having a view – something that pleases neither side.

What’s happening here, of course, is that Unite is using its considerable influence to quash any remainery.

Mike Smithson



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Chronicle of a bet foretold Part 2

September 22nd, 2019

It is 11am on September 21st 2019 as I write this. Earlier in the year I wrote an article about fixed-odds betting used to insure against political risk. I finished by saying I would investigate other modes, specifically currency conversion. This is that investigation.

PREAMBLE

The investigation took the form of recollections of previous betting combined with consideration of new modes. Time constraints meant that some modes could only be briefly examined so conclusions from this article should be taken as illustrative and advisory, not conclusive. If the reader notes any errors, please point them out.

The modes covered in the article are spread betting, fixed-odds betting and betting exchanges, bureaux de change, currency conversion and other modes such as tailored foreign exchange and political insurance. I consider them as follows:

SPREAD BETTING

Historically, British gambling regulation has been class based, with subdivisions such as horserace betting (literally the sport of kings!), telephone betting (used by the middle classes) and high-street gambling (working-class) attracting different regulation at different times. One of the odd tributaries of this phenomenon is the regulation of spread betting, which is governed by the Financial Conduct Authority (formerly the FSA), not the Gambling Commission. Spread betting accounts have a ferocious reputation: the majority of customers lose money, some lots. Consequently regulation has grown tighter.

In UK spread betting, you bet on the movement, not the level: one buys at level X, sells at level Y and the more the change, the greater the profit/loss. (US spread betting may be different and we do not cover it). This allows great profit to be made with little money, but the requirement to keep a float to maintain a positive balance and the possibility of great loss if the movement is in the wrong direction makes this high-risk/high-reward.

Opening an account requires bank details and proof of ID, and you are warned that losses may be large. I closed my account some years ago and changing regulation means that further checks and limits may now pertain. Political betting is availably from IG Index and Sporting Index. Sporting Index is familiarly known as “SPIN” and has a habit of suspending trading during uncertain times.

FIXED-ODDS BETING AND BETTING EXCHANGES

These are regulated in GB by the Gambling Commission, but difficulties in prosecutions and the anomalous position of Northern Ireland (not all legislation applies to NI and the suspension of Stormont and the different polity morals means that regulation has not yet caught up) means that some bookmakers insist they are regulated by overseas bodies such as the Malta Gaming Commission. That argument is best settled by lawyers.

In GB fixed-odds betting (we occasionally use the American term “sportsbook”, which I quite like), the bookmaker acts as the layer (betting against the future event) and offers odds. The punter is the backer (bets on the future event) and deposits money with the bookmaker until the event is resolved. In betting exchanges the bookmaker acts as matchmaker, with one punter acting as backer and another as layer. Unmatched money is returned to the punters on resolution.

It is medium-risk/medium-reward, with the possible profit and loss being fixed at the point the bet is made. It is freely available and can be done in-person via a high-street bookmaker or remotely via an online or telephone account. In-person betting ordinarily does not require an account or ID, but remote betting has bureaucracy. Political betting is available in-person or remotely via Ladbrokes/Coral and William Hill, or Betfair Exchange. Other bookmakers are available.

CURRENCY CONVERSION

The above methods allow political betting on events directly, but one may be more concerned with the effects of the event and require proxy betting. Since my concern is on currency effects, currency was the obvious proxy. Betting on currency movements may be done via spread betting or (rarely) sportsbook/exchange betting, but currency conversion is also viable. Currency conversion may be done in-person via a “bureau de change” (a high-street kiosk that physically changes currency in one denomination into another) or online via dedicated foreign-exchange firms or foreign-currency accounts offered by some high-street banks.

Bureax-de-change are usually used for holiday money and may offer buyback facilities: buying and selling at the same exchange rate for a limited period. They require no registration and are zero-risk, but will have a poor exchange rate and carrying large amounts of cash is difficult and raises eyebrows. An online foreign-currency account only requires an existing bank account and is low-risk/low-reward, as adverse positions can be traded out of rapidly. But to cover a sufficient risk requires moving a lot of money, which brings its own problems. Bureaux-de-change can be found via yell, a foreign-exchange firm is Travelex. For foreign-currency accounts, please see the high-street banks.

OTHER MODES

There exist tailored foreign exchange services (for example Tramonex, which went but last year) and political insurance via Lloyds (there are syndicates, such as AmTrust? Validus? Apols if these are wrong) but are aimed at corporate entities/very-high-net-worth individuals and are outside my weight-class: for example, Tramonex required 500,000GBP traded per annum, which is way outside my reach. I did not investigate these. Tramonex no longer exists (see here) and I did not research others. For Lloyds Political Risk insurance, please see here and other sources.

MY CHOICE

In the previous article I outlined my use of a fixed-odds bet to insure against adverse currency changes in the event of no-deal. I practice betting transparency, so I outline here my use in Q2-3 2019: numbers are given magnitudally to preserve some anonymity. Previous experience of spread-betting some years ago had been scary and counterproductive: lacking any knowledge of movement I could not make a profit and I closed my account in short order after a total three-figure loss. Some years ago I changed four-figures into USD, which was fun but walking around with a thick wad in your back pocket is obviously stupid, so I converted back at zero loss.

So since 2016 I have opened USD and EUR accounts and in Q2-3 2019 I started moving money en-masse, currently totalling low-five-figures in various USD and EUR accounts (gulp!). This is personally traumatic: moving large sums of money inspires fear, and lack of any real knowledge about currency movements inspires uncertainty. I deal with this by moving smaller sums at smaller intervals, which normalises the behaviour and reduces the trauma of a Large Event.

Today is September 21st 2019. The rates are 1GBP=1.13EUR and 1GBP=1.24USD. At those rates I have a low-three-figure profit in EUR but a mid-three-figure loss in GBP (converting back incurs an additional conversion cost!).

In the event of Deal, I guess EUR will pass 1.2 and USD will pass 1.3 within 48 hours of the announcement and my losses in GBP will be low-four-figures, at which point I will trade out with alacrity before they settle at over 1.3 and over 1.35 within the month.

In the event of No-Deal, I guess EUR will pass 1 and USD 1.15 within 48 hours before settling at 0.95 and 1.05 within the month: at that point I will remain in as my gains in GBP will be low-four-figures. I will let you know what happens.

Viewcode

Viewcode is a statistician who works in the private sector



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Labour’s leadership machinations could be a pointer that an early change is being planned

September 21st, 2019

So far I have not been tempted to take the Betfair 26% that Corbyn will step down as LAB leader during 2019.  But an early exit for Mr Corbyn is how some of the machinations ahead of the party conference both last night and this morning are being interpreted.

Why the party had to change its position on a move that seemed to be about abolishing the role of deputy leader as a means of clipping Watson’s wings we do not know.  It appears as though the position of Tom Watson was threatened in the first place because there was the possibility that he would, by being deputy, be the default temporary leader when Corbyn goes.

Something has been going on for the motion to have been published in the first place and then replaced by what appeared to be  much more apparently moderately sounding one. Maybe this is a common tactic. The first with the the deputy job being abolished was published in order to test the waters. Given that it has received such a negative response then maybe that has driven the decision to change it into something that appears more acceptable.

The fact is that this month Corbyn enters his fifth year as Labour leader which apart from Nicola Sturgeon makes him one of the most long-lasting leaders in the UK.  In the sametime period the Tories  have gone from Cameron to to Theresa May and now to Mr Johnson while the LDs have gone from Tim Farron to Vince Cable and now to Jo Swinson.

Whatever it is hard to see how  Corbyn could stand aside with all the talk of an imminent general election in which the LAB leader himself could play the key part in triggering by moving a confidence vote under the FPTP Act procedures.

If there is a general election then whether Corbyn will be lead could be an issue. After all the LAB leader is the next PM, elections permitting, in waiting and what has happened has raised doubts. Maybe this blunts the Corbyn negative factor.

Mike Smithson


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The hurricane on Labour’s horizon

September 21st, 2019

Labour can’t rely on election campaign miracles every time

As Labour gathers for its annual attempt to spread a veneer of forced goodwill over ruthless power-plays, rather like a Game of Thrones family Christmas, they ought to be asking a rather different introspective question than ‘how does Momentum increase its control?’. They should be asking ‘how do we get out of this disastrous polling position?’. They almost certainly won’t.

Because the truth is that Labour’s polling position – buttressed by real votes in real elections – is appalling. It’s easy for familiarity to breed complacency. With the polls having Labour’s share hovering around 25% on average since the European elections four months ago, these are numbers we’re now used to so rather than being shocked, we just accept them as the new normal.

The reality though is that the latest poll of each of the ten companies to have released results based on fieldwork carried out this month put Labour between 21% and 28% (inclusive). Even the best of these is slightly below what Labour polled in 1983, when their GB share was 28.3%; everything else would certainly be their worst result since 1918. As the two polling companies whose polling got closest to the actual result at the EP election (also the two companies least likely to be affected by false voter recall) give Labour 21% and 24% respectively, chances are the true share is at the bottom end of that range.

Put another way, these polls imply that Labour has lost almost half its vote – over six million voters – since the 2017 election.

It’s true that the Tories are also well down on their own 2017 share: the same ten polls put them in the 28-38 range with an average of 32 and shares from Mori/YouGov of 32-33. That’d be a decline of around 10%, equating to a quarter of their 2017 vote or around 3.5 million votes. That’s bad but in the context of a worse Labour decline, it’s still a net swing to the Blues.

These voting intention figures are backed up by other data. This month’s Mori leader satisfaction ratings saw Corbyn poll the worst-ever net rating for a Leader of the Opposition since the series began in 1977: -60. That’s around 30 points worse than Hague going into the 2001 election or Kinnock going into the 1987 one; it’s 15 points worse than Foot’s rating two months before the 1983 poll.

As this tweet notes, there’s a clear (but not always consistent) relationship between the gap in leader ratings and the eventual election result. Although we don’t yet have this month’s rating for Johnson, the most recent figure that we do have implies a very healthy Con majority.

If you prefer real votes we could equally take the local by-election results this week. Labour’s vote declined in all six. Or looking a little further back, Labour’s vote share suffered double-digit declines in the two summer Westminster by-elections (note that while Labour started in third in Brecon this year, when Blair was leading Labour back towards government, Labour put on vote share in similar by-elections such as Littleborough & Saddleworth or Perth & Kinross – being squeezed isn’t inevitable in such circumstances). Alternatively, we could look at the EP elections, where Labour finished third, with fewer votes than the Lib Dems – the first time that’d happened in a national poll since 1910; Labour failed to win a single constituency.

Of course, this might not matter. The election won’t be tomorrow; it might not be for months. Much could change between now and then. There will be an election campaign and Corbyn might perform another miracle to match the one from 2017 but it’s unlikely.

2017 has entered Labour mythology but the truth is that the cards fell perfectly for Corbyn. Having called the election on the issue of Brexit – where the Tories were reasonably strong at the time – Nick Timothy then sabotaged the Conservative campaign by producing a manifesto which was massively unpopular and which also had the effect of dragging the election debate onto domestic policy where Corbyn was far more comfortable. On top of which, Theresa May practically hid in a box for the duration, while Tim Farron wasted the Lib Dems’ media exposure by becoming embroiled in a bizarre controversy about Christianity and gay sex. They gave Corbyn a far clearer run than anyone expected, and made the most of it.

It would be optimistic in the extreme for Labour to expect such a favourable ride again (and of course, both Labour and Corbyn are more unpopular now than they were before the 2017 vote). Labour’s Brexit policy is confused and if the row over the Deputy Leadership is going to set the tone for Labour’s conference, chances are the divisions on Brexit policy won’t be healed. If so, the question of whether Labour is an ‘in’ or ‘out’ party will dog them throughout the campaign.

Labour could quite simply be sleepwalking into a catastrophe the like of which they cannot imagine. It’s easy for commentators to slip into the comfort zone, predicting small changes. Most elections do produce relatively small changes. However, the electorate is becoming ever more transactional and identifying less with parties, as this very good Prospect article explains and inertia only takes you so far. As happened in Scotland this decade or across the UK in the 1920s, change, when it comes, can come quickly and ruthlessly. No party has a right to the top table (Boris Johnson and co might want to take note there too, in passing).

This isn’t to say that Labour will suffer the kind of wipe-out that Scottish Labour did in 2015 (which actually just repeated what happened in 2011); not straight away anyway. But there is a whole dashboard of warning lights flashing. They should not be ignored.

David Herdson



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Mayor of London Siobhan Benita? Don’t rule it out

September 20th, 2019

SV means the Lib Dems could pull off something extraordinary

In the absence of big names and big characters, London politics has dropped off the media radar a bit. After the controversial Ken Livingstone and the future PM Boris Johnson, Sadiq Khan has been – spats with Donald Trump aside – a lower-profile mayor.

Khan’s term ends, however, in less than eight months, when he’ll bid for re-election. Until recently, this was all-but assured. The Tory candidate, Shaun Bailey, looks lightweight and gaffe-prone while all other candidates seemed doomed to be also-rans. No candidate from the minor parties (which in London included the Lib Dems) has ever polled more than 15%, other than exceptional case of Livingstone in the initial election of 2000; in the last two elections, none outside of Con/Lan polled more than 6%. Add in the dominance of these two parties in the polls at the start of the year and everything looked set for something like a repeat of 2016. Not now.

For one thing, Sadiq Khan’s popularity ratings generate a ‘meh’ response from Londoners. In a July YouGov poll, he recorded 30% satisfied and 33% dissatisfied, for a net -3 rating. Overall, that’s not bad and certainly much better than many politicians rate (though London has been a strongly Labour city through the 2010s so they’re maybe not quite as good as they first appear). On the other hand, there are a lot of Don’t Knows in there, which allied to the negatives suggests there is opportunity for an opponent.

However, the revolution in party support this year opens everything up. Across the country as a whole, Labour may be down by close to half what it polled in January, with the Tories down by at least a quarter. In London, the main beneficiaries have been the Lib Dems, who finished first across the capital in the European elections and have polled first in Westminster VI there too in some polls (albeit in unweighted and small subsets, with consequently large margins of error).

Of course, it’s one thing to do this in an election no-one really campaigns in or in opinion polls; quite another to produce that result when the parties are running near full-throttle. Do the Lib Dems have the manpower and resources to match Labour? That’s still a very open question and without positive evidence to suggest so, we have to assume that the campaign factor still works strongly to Khan’s favour.

On the other hand, Siobhan Benita has three things going for her (besides the quality of the other candidates and her ability to hold her own on that score). Firstly, London is a very strongly Remain city and the Lib Dems are very strongly Remain. Secondly, Khan doesn’t have a great track record and is likely to be the subject of far more negative campaigning from all parties than she will, especially on crime.

And thirdly, the Supplementary Vote system. Benita probably doesn’t need to win the first round in order to win outright: she can probably expect more transfers than Khan. This is, admittedly, finger-in-the-air stuff from me but if she can beat Bailey in the first round, then transfers will either be coming from the right-of-centre or from left-of-centre voters who have chosen not to back Khan. In both cases, I’d guess that she should win the greater number if the first round is close (although there may be high levels of non-transferable votes). If she can reach the low-30s in the first round – a level the Lib Dems have polled at in London – she’d stand a good chance of winning.

Now, it has to be said that the polling doesn’t yet bear such a prediction out. We’ve only had one poll since the party ructions in the Spring, and that was in early May, which had Benita polling fourth on 10%, behind the Green candidate Sian Berry (16%), with Bailey still second on 23%. Clearly, there is some work to do in convincing the public – to which end the EP election results, bar charts and “can’t win here” allegations would no doubt feature.

There are two other critical factors to consider. Between now and next May, there’s a good chance that at least one and perhaps two things will happen: Brexit will finally occur, and a general election will take place. Both have the capacity to do a lot of damage to the major parties. It is possible that come May, Corbyn could be in a honeymoon period, having restored post-No Deal order with an agreement, so providing Khan with a nice clear national backdrop against which to sweep to re-election.

On the other hand, it’s entirely possible that Labour could be in a right mess following either victory or defeat (likewise the Tories, though that’d matter less for these purposes). If YouGov’s methodology rather than Survation’s is correct then Electoral Calculus has the Lib Dems making eight gains across London, four from both the Tories and Labour on the most recent poll. For reference, YouGov got the Lab-LD gap at the recent EP elections right to within 0.2% (understating both by about 1%); Survation missed the mark by some 17%! Such a sweep of gains would surely greatly affect public perceptions as to which parties are serious contenders for the mayoral race.

Does all this make the Yellow Team favourites? Not at all. That honour still lies with the Reds and the power of incumbency, political inertia and the hard facts of such polling as we have. However, this is a race to keep an eye on, particularly on how intensely the Lib Dems are ramping up their campaign efforts on the ground in London. If they do, then the current odds for Benita, as long as 7/1, would be value.

David Herdson



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Corbyn’s Ipsos-MORI satisfaction ratings drop to the lowest for an opposition leader since it started in 1977

September 20th, 2019

Hardly the platform for an election campaign

Ipsos-MORI, has been polling UK politics since 1977, and throughout that time has been asking in exactly the same manner if those sampled are satisfied/dissatisfied with a range of political leaders. We had the latest numbers for Jo Swinson yesterday. Today the Corbyn figures are released and have the LAB leader with a dissatisfied rating of 76% with just 16% saying satisfied.

Amongst those who voted LAB at 6E2107 33% said they were satisfied with 60% saying satisfied. Compare that with the 42% satisfied to 35% dissatisfied that the same segment recorded for Jo Swinson.

As Keiran’s Tweet points out these are the worst figures any opposition leader recorded by the firm and his Tweet looks at the record lows for all who’ve held that post for more than half a century.

The LAB leader needs to stage a recovery far far in excess of what happened at GE2017 for his party to have any chance. Then Corbyn started the campaign with a net rating of -25%. That compares with today’s net rating of minus 60%.

Mike Smithson


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The real issue, surely, is that Johnson does not have the confidence of the Commons and should have quit when the Benn bill passed

September 20th, 2019

The blog post above, which is well worth reading in full, from a leading academic expert on the prerogative articulates something which has not really been taken up before. The fact is that PMs derive their authority by being able to command a majority in the House of Commons. So far in his short premiership Johnson has lost every vote including one that could be regarded as issue of confidence – the Benn bill which is now law. Arguably Johnson should have quit when that bill went through against the wishes of his government.

Professor Anne Twomey states:

“Where prorogation is undertaken at the behest of a government which has, or appears likely to have, lost the confidence of the lower House, and is done for the purpose of avoiding a vote of no confidence or other action by Parliament against the government’s will (which may amount to an implied vote of no confidence), then such action may be regarded as ‘unconstitutional’ and may legitimately be rejected by the Queen”

This view could be important if the Supreme Court rules next week that the prorogation was null and void and Johnson, no doubt at the behest of Cummings,seeks to close Parliament down again. The Queen could refuse such a request.

All could have been different if in the immediate aftermath of Johnson’s victory in the Tory leadership contest there had been an effort to legitimise his premiership by winning a key vote in the Commons. I’d suggest that it would have been a lot easier then than it would now.

Mike Smithson


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New Democrat nominee polling finds Warren’s generates the most enthusiasm

September 19th, 2019

 

 

In general almost all the Democratic nominee polling that we’ve seen this year has had 76 year old Joe Biden in the lead. This has been a been underpinned by the findings that he’s seen as the one most likely to beat Trump.  Even so it is being suggested that his position is not as strong as it might appear.

The growing doubts about the former VP are basically because of ongoing gaffes, his age and little things that underline that like talking about young people and record players in the last debate. He finds it increasingly difficult to keep on topic when responding to questions and meanders.

It is in this context that HuffPost has commissioned the above polling asking about enthusiasm for each contenders rather than voting intentions.  Those sampled were asked to to give their level of enthusiasm for the long list of people still in the race and how upset people would be in relation to each of them

The findings are in the table above and as can be seen Elizabeth Warren tops this table with  Biden coming in third place because 25% say they would be upset if he got the nomination.

I think the questions that hang over Joe will continue and polling like this is not going to help.

Mike Smithson