I'm not into investments but for those who trade, CDS on Uk might be worth looking at for potential profit in far horizon.
Not sure how the tax cut itself was viewed by the public but it is the unknowing scapegoat for the turbulent reaction from the market. You have a healthy fund and economy but all sitting on a structurally unsound platform, a house of cards designed to topple with just a kick at the right time. Your pension fund holding mostly govt debt is effectively a market participant now because of this LDI and by letting a third party broker have access to sell the debt at discretion under margin call or just rehypothecation, there is no more risk difference between equity and debt. When you trade debt like equity, it is equity on crack so your gilt market is now acting like the stock market that absorbs the jitters first but exponentially and your equity (is anyone even paying attention to that) 2nd place like a bond market but without the anchoring effect of real bonds. I think last week was by the skin of your teeth and only because there was already a debt repurchase plan in place so there was no hold up.
Shareholders and directors can't trade their shares around results or IPO because company is most vulnerable and needs stability so can't have large trades that swing the price or mislead other investors. But you've signed away the right to a broker lucky enough to land your pension fund as a client to dump gilts into the market and only during times when your govt needs most support from its backbone. Like happily paying someone to kick in your front door. Your trading market fine and good but on a platform that is already so structurally unsound it cant brace itself from the jitters expected from a normal in cycle fully anticipated announcement without your national bank stepping in.
Mr Osbourne had an austerity-lite programme where he talked massive cuts with rapid paying down of debt but implemented something much less severe. Ms Truss has a borrow and spend plan which seems to be straight from Kier Starmer's playbook early in his role as leader of the opposition.
Last edited by East_coast; 07-10-2022 at 09:18 AM.