Every time I write a British question, I will reflexively add this sentence "I have always opposed Hong Kong people's immigration to the UK." This is not a curse, but a kind-hearted persuasion. The three highlands of the world economy are Europe, East Asia and North America. In the visible next thirty years, Europe's development prospects are the worst: deindustrialization , indigenous people's birth rate, fiscal discipline disorder, Internet celebrities and politicians dominate, lack of sufficient advanced industries, and internal disunity. In addition to the reduction of birth, the above problems are not only not seen in East Asia, but also relatively speaking, East Asia is an excellent student in all aspects. China, its core country, will also surpass the United States, the core country of North America in the next decade. It can be said that East Asia has the best future.
The problems in the UK are more prominent, and the shocks caused by Brexit in the past few years: labor shortages and financial industry strikes in Eastern Europe have not been dealt with well, that is, the epidemic blockade came in 2020; this year, the geopolitical and energy crises caused by the Russian-Ukrainian conflict were added. It is just that one wave has not yet settled, and the wave has started again and again. Now that crises are occurring at the same time, it is normal for the pound to be weak.
Hong Kong people who have immigrated to the UK in the past two years have gone from an upward platform to a downward platform from a general environment, while their personal small environment has dropped from the middle class in Hong Kong to the low-income class in the UK, which can be said to have lost twice in a row. But I never imagined that Britain's decline was faster than expected. I could not imagine that British politicians were still making trouble during these stormy days, and they pushed the pound directly into the emergency room, and yesterday set the lowest currency value in history. This is true!
On September 23, the new British government announced the most radical tax cut since 1972, including the cancellation of the plan to raise corporate tax to 25%, the cancellation of the highest tax rate of 45%, and significant cuts to stamp duty, etc. The relevant tax cut plan is worth as high as £45 billion, exceeding the tax cuts introduced during the reign of Mrs. Dai Zhuoer in 1988, and is the largest in half a century.
This tax cut should have enhanced the market's confidence in the development of the UK economy. Logically, the pound should have strengthened, but why is the market's reaction completely opposite?
According to common sense, the government should adopt countercyclical economic policies, that is, to significantly release water in the recession to stimulate the economy, and vice versa. But this time the British government is using cyclical policies.
This time, the UK tax cut is for the rich. The maximum income tax rate of 45% will be abolished in the plan. This tax rate is only applicable to the highest income group and has nothing to do with the civilian class. However, the tax cut also significantly reduced the fiscal revenue of the British government. The market expects to reduce taxes by about £161 billion in the next five years, at which time, the UK government has announced subsidies for household energy bills, which will cost £60 billion in the next six months.
The tax sources have decreased, and fiscal expenditures have to increase. The British government can only have one trick: print money.
Therefore, the UK inflation was already the highest in G7. Now, while hiking interest rates hikes suppresses inflation, accelerating printing of money and triggers inflation. How can people have confidence in the pound with such a chaotic economic policy?
Hong Kong people who immigrated to the UK last year fell from 10.76 to 8.1356 in less than a year, with a book drop of nearly a quarter. With higher interest rates and worse economy, returning to Hong Kong may be the final or only option.
Now I can ask an upcoming question: Will Hong Kong people who immigrate to the UK return?
text: Youran
