Christian Spence
@christianspence.co.uk
Economics · Data Science · Public Policy
Founder & Chief Economist @economic-analytics.co.uk
Economic Data Lead @open-innovations.org
Chief Economist & Fellow @insplacemanagement.bsky.social
#EconSky #Rstats #Rshiny
Founder & Chief Economist @economic-analytics.co.uk
Economic Data Lead @open-innovations.org
Chief Economist & Fellow @insplacemanagement.bsky.social
#EconSky #Rstats #Rshiny
Super interesting (and technical!) blog on bond markets and budget reaction. One thing not mentioned is US markets will be shutting down on Budget Day ready for Thanksgiving.
With a desire to manage closing positions and much less liquidity in global markets the day after, movements could be large.
With a desire to manage closing positions and much less liquidity in global markets the day after, movements could be large.
The UK bond market is highly sensitive as it approaches next week’s #Budget. This blog explores the channels through which the #Budget can impact borrowing costs and shows how a credible fiscal plan could potentially lower gilt yields and earn a ‘credibility dividend’.
niesr.ac.uk/blog/how-mig...
niesr.ac.uk/blog/how-mig...
November 21, 2025 at 11:36 AM
Super interesting (and technical!) blog on bond markets and budget reaction. One thing not mentioned is US markets will be shutting down on Budget Day ready for Thanksgiving.
With a desire to manage closing positions and much less liquidity in global markets the day after, movements could be large.
With a desire to manage closing positions and much less liquidity in global markets the day after, movements could be large.
This is a good piece. One thing particularly leapt out for me:
"Assumes a sharp distinction with delivery: policy is mainly central, elite; delivery is mainly local, frontline — admirable but lower."
The huge disconnect between ideas and delivery is a big problem. "Logistics trumps strategy" etc.
"Assumes a sharp distinction with delivery: policy is mainly central, elite; delivery is mainly local, frontline — admirable but lower."
The huge disconnect between ideas and delivery is a big problem. "Logistics trumps strategy" etc.
🔔 New post 🔔 Ok, this was a bit of a 'take a deep breath' moment! - I'm intrigued about how much pushback I'll get.
The disiciplines theory of government
Are a small number of legacy disciplines dragging the whole operation down?
medium.com/@jamestplunk...
The disiciplines theory of government
Are a small number of legacy disciplines dragging the whole operation down?
medium.com/@jamestplunk...
The disciplines theory of government
Are legacy disciplines dragging the whole operation down?
medium.com
November 19, 2025 at 12:37 PM
This is a good piece. One thing particularly leapt out for me:
"Assumes a sharp distinction with delivery: policy is mainly central, elite; delivery is mainly local, frontline — admirable but lower."
The huge disconnect between ideas and delivery is a big problem. "Logistics trumps strategy" etc.
"Assumes a sharp distinction with delivery: policy is mainly central, elite; delivery is mainly local, frontline — admirable but lower."
The huge disconnect between ideas and delivery is a big problem. "Logistics trumps strategy" etc.
👀
This is clever briefing but not actually how OBR forecasts work.
The last pre-measures forecast, where this could have been true - was 31 Oct, 5 days before Chancellor's speech. Market determinants were also taken a month ago.
This suggest pulling back was the plan all along.
The last pre-measures forecast, where this could have been true - was 31 Oct, 5 days before Chancellor's speech. Market determinants were also taken a month ago.
This suggest pulling back was the plan all along.
The UK government ditched plans to raise income tax rates after an improved fiscal forecast from the Office for Budget Responsibility, according to people familiar with the matter.
Follow our live blog for the latest: on.ft.com/4pc7LC1
Follow our live blog for the latest: on.ft.com/4pc7LC1
November 14, 2025 at 12:03 PM
👀
The behavioural incentives mount when marginal tax rates are 42% (40% IT, 2% NI); not too much of an issue when few were in scope. This far down the distribution, many people will hit this for some period of working life. Add in student UG loan and for many it's 51%. 40% of London FT workers caught.
One in four employees in England and Wales will be higher rate taxpayers by the end of the decade if Rachel Reeves extends a freeze on personal tax thresholds for a further two years, the Institute for Fiscal Studies has said. on.ft.com/4i0o2HS
November 14, 2025 at 11:54 AM
The behavioural incentives mount when marginal tax rates are 42% (40% IT, 2% NI); not too much of an issue when few were in scope. This far down the distribution, many people will hit this for some period of working life. Add in student UG loan and for many it's 51%. 40% of London FT workers caught.
The OBR hath given: +£10bn of headroom. Putting aside the fact the OBR may taketh away in a future year, the govt has already paid its political costs for tax rises. It will be judged in 2029 on whether the country is better. It is more likely to be better with cash. Why not just take the "win"?
November 14, 2025 at 11:41 AM
The OBR hath given: +£10bn of headroom. Putting aside the fact the OBR may taketh away in a future year, the govt has already paid its political costs for tax rises. It will be judged in 2029 on whether the country is better. It is more likely to be better with cash. Why not just take the "win"?
Just catching up on this (excellent) podcast. It points out (amongst lots of things - go listen!) something which I really hadn't realised.
The Budget is scheduled for the day before Thanksgiving. That means the bond markets are going to be seriously short on liquidity the day after.
The Budget is scheduled for the day before Thanksgiving. That means the bond markets are going to be seriously short on liquidity the day after.
NEW PODCAST: Are we in hock to the bond market?
🎧 Listen to our latest IFS Zooms In episode with @helenmiller.bsky.social, @benzaranko.bsky.social and Jack Meaning on how the bond market affects the government's decisions and what investors will look for in the Budget: ifs.org.uk/articles/uk-...
🎧 Listen to our latest IFS Zooms In episode with @helenmiller.bsky.social, @benzaranko.bsky.social and Jack Meaning on how the bond market affects the government's decisions and what investors will look for in the Budget: ifs.org.uk/articles/uk-...
November 14, 2025 at 9:12 AM
Just catching up on this (excellent) podcast. It points out (amongst lots of things - go listen!) something which I really hadn't realised.
The Budget is scheduled for the day before Thanksgiving. That means the bond markets are going to be seriously short on liquidity the day after.
The Budget is scheduled for the day before Thanksgiving. That means the bond markets are going to be seriously short on liquidity the day after.
"For too long, Britain has been held back by governments that, because they lack a relentless focus on long-term ends, are buffeted about by events."
Kier Starmer, Labour Manifesto 2024
Kier Starmer, Labour Manifesto 2024
November 14, 2025 at 8:59 AM
"For too long, Britain has been held back by governments that, because they lack a relentless focus on long-term ends, are buffeted about by events."
Kier Starmer, Labour Manifesto 2024
Kier Starmer, Labour Manifesto 2024
Apologies to all my clients who I'm delivering post-Budget presentations to this year, but we're going to need a considerably longer slot.
Give Me More Time Wednesday Addams GIF
ALT: Give Me More Time Wednesday Addams GIF
media.tenor.com
November 14, 2025 at 8:33 AM
Apologies to all my clients who I'm delivering post-Budget presentations to this year, but we're going to need a considerably longer slot.
Does the government have enough planning skill to both think this up and pull it off?
Anyway, even if so, it only helps you *now*. The real problem still exists.
Anyway, even if so, it only helps you *now*. The real problem still exists.
Here's an extraordinarily cynical take: did the government talk up the likelihood of a manifesto-breaking income tax rise in the knowledge that it would push down gilt yields in the window the OBR will use for its forecasts? Rowing back now pushes up yields but too late to enter the forecast on 26th
And there we go 10y opened up 11 basis points erasing 1/3 of the rally since October.
November 14, 2025 at 8:19 AM
Does the government have enough planning skill to both think this up and pull it off?
Anyway, even if so, it only helps you *now*. The real problem still exists.
Anyway, even if so, it only helps you *now*. The real problem still exists.
One can't help but wonder if anyone in HMT has ever heard of the idea of tax morale. You might find it easier to raise more revenue if it's somewhat higher.
The UK just has incredible attention to detail when it comes to making sure the people who pay all the taxes can’t have nice things. Child benefit? No. Free Child car? No. Cut price bike to cycle to work? No.
Functionally we are telling people they pay too much tax to get anything from the state.
Functionally we are telling people they pay too much tax to get anything from the state.
Rachel Reeves is setting the Cycle to Work scheme on fire as part of the war on salary sacrifice policies! on.ft.com/4oKXNrC
November 13, 2025 at 11:14 AM
One can't help but wonder if anyone in HMT has ever heard of the idea of tax morale. You might find it easier to raise more revenue if it's somewhat higher.
Budget chatter reverberates everywhere ("will she, won't she, we don't know"), but this, reported by Sky News, is intriguing.
'Rachel Reeves is unlikely to hike these taxes because the Treasury says those earning £45,000 or less qualify as "working people".'
Higher rate threshold to come down?
'Rachel Reeves is unlikely to hike these taxes because the Treasury says those earning £45,000 or less qualify as "working people".'
Higher rate threshold to come down?
October 30, 2025 at 10:39 AM
Budget chatter reverberates everywhere ("will she, won't she, we don't know"), but this, reported by Sky News, is intriguing.
'Rachel Reeves is unlikely to hike these taxes because the Treasury says those earning £45,000 or less qualify as "working people".'
Higher rate threshold to come down?
'Rachel Reeves is unlikely to hike these taxes because the Treasury says those earning £45,000 or less qualify as "working people".'
Higher rate threshold to come down?
Looking forward to this. One reason why I'm dubious about killing NI and switching it onto IT (both IFS and Mirrlees Review say we should) is that the UK has never had a proper debate about a contributory benefits system, particularly around the issue of tax morale.
NEW PODCAST: Should the middle classes get benefits?
@helenmiller.bsky.social, Tom Waters & Nicholas Timmins trace the history of UK welfare system and examine whether benefits should be universal, means-tested or contributory in this week's IFS Zooms In.
🎧 Listen here: ifs.org.uk/articles/sho...
@helenmiller.bsky.social, Tom Waters & Nicholas Timmins trace the history of UK welfare system and examine whether benefits should be universal, means-tested or contributory in this week's IFS Zooms In.
🎧 Listen here: ifs.org.uk/articles/sho...
October 2, 2025 at 4:12 PM
Looking forward to this. One reason why I'm dubious about killing NI and switching it onto IT (both IFS and Mirrlees Review say we should) is that the UK has never had a proper debate about a contributory benefits system, particularly around the issue of tax morale.
This week I have mostly been reading ... @theifs.bsky.social 1978 Meade Report: The Structure and Reform of Direct Taxation.
October 2, 2025 at 3:55 PM
This week I have mostly been reading ... @theifs.bsky.social 1978 Meade Report: The Structure and Reform of Direct Taxation.
As David Hume might have said, "Empires may rise and fall; liberty and slavery succeed alternately; ignorance and knowledge give place to each other; but profit per partner will still remain, and will never be affected by the revolutions of human society."
www.ft.com/content/d3aa...
www.ft.com/content/d3aa...
Deloitte UK’s revenues fall for first time in 15 years but partners’ pay rises
Cost-cutting drive helps shield profits at Big Four firm
www.ft.com
September 30, 2025 at 9:32 AM
As David Hume might have said, "Empires may rise and fall; liberty and slavery succeed alternately; ignorance and knowledge give place to each other; but profit per partner will still remain, and will never be affected by the revolutions of human society."
www.ft.com/content/d3aa...
www.ft.com/content/d3aa...
Hadn't realised that Grimshaw had died, and now Farrell, too. Fascinating architectural practice. Plans for an FT obit?
Saddened to hear of the death of Terry Farrell so soon after his former partner Nicholas Grimshaw. Two real titans of British architecture lost in a couple of weeks. Farrell was a bona fide working class architect. A genuine good guy.
September 29, 2025 at 1:35 PM
Hadn't realised that Grimshaw had died, and now Farrell, too. Fascinating architectural practice. Plans for an FT obit?
I feel that the argument for digital ID cards could be more easily won if government focused on how they can strengthen the citizen against the state. As someone who's in the process of moving house, having to do five separate ID checks (and being charged for some of them) has been a real pain.
September 26, 2025 at 8:56 AM
I feel that the argument for digital ID cards could be more easily won if government focused on how they can strengthen the citizen against the state. As someone who's in the process of moving house, having to do five separate ID checks (and being charged for some of them) has been a real pain.
Today I will mostly be wrestling with the OECD API.
Thoughts and prayers appreciated.
Thoughts and prayers appreciated.
September 25, 2025 at 9:16 AM
Today I will mostly be wrestling with the OECD API.
Thoughts and prayers appreciated.
Thoughts and prayers appreciated.
@alphaville.ft.com is always worth reading for many, many reasons, but the occasional sarcastic digs are always up there. Not content with aiming at the Bank of England's communications on QT (answer in two minutes), today the target is French diacriticals: Sóćíéťé Géńéřáľë
September 18, 2025 at 10:59 AM
@alphaville.ft.com is always worth reading for many, many reasons, but the occasional sarcastic digs are always up there. Not content with aiming at the Bank of England's communications on QT (answer in two minutes), today the target is French diacriticals: Sóćíéťé Géńéřáľë
Monthly GDP statistics: too volatile, and draw too much focus onto short monthly changes.
The @financialtimes.com had a piece last week ("Abolish monthly UK GDP") and the ONS may have just complied, but not by abolishing it (that would be daft) ... 🧵(1/7)
The @financialtimes.com had a piece last week ("Abolish monthly UK GDP") and the ONS may have just complied, but not by abolishing it (that would be daft) ... 🧵(1/7)
Abolish monthly UK GDP
Provocative headlines are more likely to generate clicks
www.ft.com
September 15, 2025 at 11:00 AM
Monthly GDP statistics: too volatile, and draw too much focus onto short monthly changes.
The @financialtimes.com had a piece last week ("Abolish monthly UK GDP") and the ONS may have just complied, but not by abolishing it (that would be daft) ... 🧵(1/7)
The @financialtimes.com had a piece last week ("Abolish monthly UK GDP") and the ONS may have just complied, but not by abolishing it (that would be daft) ... 🧵(1/7)
Is there any other senior politician who has been sacked three times in their career?
Peter Mandelson sacked as UK ambassador to the US over Epstein links
Veteran politician dismissed after days of criticism and email leaks
www.ft.com
September 11, 2025 at 9:54 AM
Is there any other senior politician who has been sacked three times in their career?
Something else I've been looking into over the past few months (still need to finish the model for what Sched A would look like today), but this debate from 1960 on Sched A relief is enlightening: api.parliament.uk/historic-han...
September 4, 2025 at 8:15 AM
Something else I've been looking into over the past few months (still need to finish the model for what Sched A would look like today), but this debate from 1960 on Sched A relief is enlightening: api.parliament.uk/historic-han...
Great thread and article linked here from @jpspencer.bsky.social. There's also a pre-/post-Covid story here with the North generally, and driven by the city regions, which shows their growth has outperformed the UK since the pandemic.
Working on more research on this over coming months.
Working on more research on this over coming months.
September 4, 2025 at 8:09 AM
Great thread and article linked here from @jpspencer.bsky.social. There's also a pre-/post-Covid story here with the North generally, and driven by the city regions, which shows their growth has outperformed the UK since the pandemic.
Working on more research on this over coming months.
Working on more research on this over coming months.
Leaving aside the fact that a 14-month-old government is having yet another "reboot" (how many is this now?), this is an important point. A common sign of failure (business as well as politics) is the inability to coherently separate and manage the operational from the strategic.
OK, but "day to day delivery" is a bad sounding phrase. Nothing important is delivered "day to day"
www.theguardian.com/politics/202...
www.theguardian.com/politics/202...
Keir Starmer shakes up No 10 operation with mini-reshuffle
Exclusive: Darren Jones appointed to new senior role in charge of day-to-day delivery of PM’s priorities
www.theguardian.com
September 1, 2025 at 10:38 AM
Leaving aside the fact that a 14-month-old government is having yet another "reboot" (how many is this now?), this is an important point. A common sign of failure (business as well as politics) is the inability to coherently separate and manage the operational from the strategic.
Bonne rentrée! After the August break (and a somewhat enforced break for personal reasons in June and July), it's good to be fully back at the desk for the big push through to Christmas. 1/2
September 1, 2025 at 9:00 AM
Bonne rentrée! After the August break (and a somewhat enforced break for personal reasons in June and July), it's good to be fully back at the desk for the big push through to Christmas. 1/2