Achuth G

😎

[Achuth G @Achuth_G]

Great analysis @yanisvaroufakis on British dependence on US. 👌🏻

[Yanis Varoufakis @yanisvaroufakis]

Every British PM’s nightmare

With Keir Starmer expected to fall on his sword shortly, here is my take on the conundrum facing Andy Burnham, indeed any and every British PM.

The true nature of Britain’s ‘special relationship’ with the United States has far more to do with American financiers’ willingness to keep borrowing to purchase British government debt than with history, culture or Britain’s defence needs. This is the burden under which every UK Prime Minister must labour.

Mike Tyson famously said, “Everyone has a plan until they get hit”. The same could be said of prospective British prime ministers, especially after Liz Truss's spectacular defenestration. They all have a plan until the guilt market hits them. Andy Burnham, Nigel Farage, my friend Zack Polanski will have to face this, if they ever move into 10 Downing Street. I think they know it. But I doubt whether they appreciate the true magnitude or nature of their predicament.

Conventional wisdom has it that the bond market comprises people looking to invest their savings in a government's debt. They seek the right balance between a higher interest rate and the increased risk this implies. For example, higher bond yields may signal that the market expects future inflation to reduce the value of the fixed interest payments that their bonds will yield. Worse still, it may foreshadow a risk of government default, as occurred in Argentina and Greece.

That’s more or less what first year economics and finance students are taught. And it’s all true. Except that, in the case of the United Kingdom, this story misses the most fascinating and worrying aspect of its government bond or gilt market: The British government’s ability to refinance its public debt of almost 3 trillion pounds does not depend on savers choosing to invest in gilts. In fact, the British government’s ability to sell gilts hinges heavily on the willingness of numerous US-based financial institutions to borrow substantial sums of dollars to purchase British gilts, which they then use as collateral to borrow for their own purposes within the US.

And there’s the rub. There is a world of difference between needing to borrow from savers and from relying on speculators who borrow themselves to lend you. Savers who lend to you focus on your long-term ability to repay them. They may tolerate your desire to make infrastructural investments that could increase your debt in the short term, in return for future profits that will help you repay them when their bonds expire. However, speculators who borrow in order to lend are a different beast entirely. They are much jumpier and prone to margin calls: situations where, if the bonds they purchased from you begin to lose value, fearing they will not be able to repay their own creditors, they dump your bonds thus turning their decline into a crash.

The question arises: Why are British bonds, or gilts, so much more reliant on American speculators borrowing money to buy them than German bunds, Japanese bonds, Italian bonds or Greek bonds? Why does every British government rely so heavily on American leveraged capital inflows?

It all started in the 1950s when the City of London discovered how to avoid following the British Empire down the road to oblivion. The trick was to carve out a niche for the City within the emerging dollar empire, which was institutionalised within the Bretton Woods system. American financiers faced rigid capital controls within that system, but the City of London was able to alleviate these due to three invaluable features.

First, London’s trading expertise and legal system offered American financiers efficiency with immunity from all sort of interventions, including democratic accountability. Secondly, Britain’s network of offshore jurisdictions offered fabulous tax-minimisation opportunities. And, thirdly, London quickly became the holding depository of a torrent of petrodollars and eurodollars, not to mention the shadowy dollars created outside the United States by foreign bankers.

Thus, the Great British paradox: while the UK's real economy was in decline, the City of London was flourishing. When the Bretton Woods system collapsed in the 1970s, American financiers discovered another use for the City: they borrowed dollars in the US short-term to buy long-term UK government gilts, which they then sold quickly to repay their loans. They would then repeat this process again and again to profit handsomely. This is how the British government became reliant on leveraged US institutions. In order to continue operating as usual, London today requires American balance sheets that are willing to expand through borrowing and use British gilts as collateral in order to maintain liquidity in the US.

Put differently, the flipside of the City’s success story is that, even though it borrows in a currency that it prints, the UK is not financially sovereign. Yes, the City occupies a strategically important position within the global dollar system but the price for this is that the UK government’s sovereignty is circumscribed by its priority to maintain the City’s central position in American finance. While this remains the priority, the occupant of 10 Downing Street is like the captain whose powers are limited to re-arranging the deck chairs on the Titanic.

Is there an alternative to this peculiar form of financial subservience to US-based leveraged financiers? Yes, but it requires a willingness to accept a falling pound and falling house prices while increasing public investment through a new investment bank that issues bonds supported by the Bank of England.

Any Prime Minister who tries to maintain Britain’s financial servitude to US capital while also investing in public goods may well put Britain on a path towards the IMF, whose sole purpose, lest we forget, is to create the political leverage that will bring about – like it did in Greece – the permanent loss of sovereignty over tax and spending policy. The question is: Do the current contenders for Britain’s top job understand this?

https://t.co/xGrWjjcudY

[Aimy 🍓🥛 @erdbeermilcher]

Marie Antoinette ist für deutlich weniger gestorben

[Achuth G @Achuth_G]

England playing the best opening quarter in Round 1. #ENGvsCRO #WorldCup

[Achuth G @Achuth_G]

Short of words. Quite unbelievable. Who on earth advised GoI to ban telegram ?? #Telegram

[Achuth G @Achuth_G]

♥️

[Lewis Hamilton @LewisHamilton]

REMEMBER WHO YOU ARE

[Alex Veremeyenko @alex_verem]

What timeline are we on man.

There’s a $60 million UFC cage on the White House lawn for the president’s 80th birthday. 125,000 guests. 494 port-a-potties. He compared it to the Eiffel Tower and said maybe they’ll never take it down.

The world’s first trillionaire was minted yesterday. SpaceX IPO. One person now holds more wealth than the GDP of most countries.

The government is negotiating to own a piece of OpenAI. The CEO walked into the White House and pitched it himself. They’re calling it a Public Wealth Fund.

That same government killed OpenAI’s biggest competitor’s models on a Friday night. The reason? A verbal jailbreak claim from an unnamed company. The same jailbreak works on OpenAI’s models. Nobody touched them.

The competitor got blacklisted by the Pentagon four months ago. Their crime? Refusing to let the military use their AI for mass surveillance of American citizens. A judge called it retaliation. The Pentagon did it anyway.

Both AI companies filed to go public in the same two-week window. Both targeting trillion-dollar valuations. One has a government equity deal in progress. The other can’t keep its products online.

The engineers who built the banned models can’t use them anymore. Because of their passports.

And an AI company that spent thousands of hours cooperating with government safety testing got punished harder than any company that didn’t bother.

UFC on the White House lawn. A trillionaire. Government-owned AI. Export controls based on phone calls. Cage fights and trillion-dollar IPOs in the same news cycle.

Watch the film titled Idiocracy. That’s the timeline we’re on.

[Achuth G @Achuth_G]

Let’s goooooo.. ! ❤️

[Charles Leclerc @Charles_Leclerc]

Here to stay ❤️ @ScuderiaFerrari

[Gnonto @PSLlufc]

Last 5 days has been busy Petrol, CNG , LPG , Milma price hike , NEET, CBSE , CUET , SSC GD scams ,inflation , Trivandrum waste management . But look at the priorities of BJP MLA Rajeev Chandrashekaran’s channel
video credits : @vinuvjohn

[Arsenal @Arsenal]

Riding high 🏆

[Achuth G @Achuth_G]

C’mon Gunner! Go for it 🏆

[Premier League India @PLforIndia]

TO EVERY ARSENAL FAN WHO WAITED 22 YEARS, THIS MOMENT IS YOURS ❤️ 🙌

@Arsenal

[Achuth G @Achuth_G]

Gracias Leyenda Carvajal ❤️

[Real Madrid C.F. @realmadrid]

LEYENDA.

[Achuth G @Achuth_G]

Pep, you were always on the other side of city but you were never a coward but always a champion. Blue side of Manchester is known for you and the team you build these years. @ManCity

What a story!

Thank you Pep Guardiola for making PL entertaining over last 10 years and also for being courageous to stand for innocent and poor across the world. ❤️

#PepGuardiola #ManchesterCity

[Achuth G @Achuth_G]

Trust the process 🏆

[Arsenal @Arsenal]

This belongs to all of us.

[Achuth G @Achuth_G]

Worth the wait. Finally, Champions ✊🏻♥️🏆

[Premier League @premierleague]

🏆 ARSENAL ARE CHAMPIONS 🏆

[Arnab Ray @greatbong]

https://t.co/FCRzKN4aZn

[Achuth G @Achuth_G]

Thank you comdrae @pinarayivijayan for an exceptional 10 years governance. Never seen a strong leader leading the state in terms of crisis management, welfare and development.

The party will come back stronger. ✊🏻

[Achuth G @Achuth_G]

Even with holding respect to people’s mandate, it’s a crazy result in Kerala and Tamil Nadu.

It’s clear that governance was not the primary factor for votes. #KeralaElectionUpdates #tamilnadulegislativeassemblyelection2026

[Nidheesh M K @mknid]

I went to Mundathicode, where a firecracker manufacturing unit for Thrissur Pooram killed 16 people nearly two weeks ago. Came back with a story published in today's Indian Express that's as much about fireworks as it is about two Keralams, watching each other. 🧵