Financial Betting Articles

Wednesday sees Alistair Darling's first Budget speech and everyone's been giving their two pence worth of what should be in it (more like fiver's worth the way inflation is boiling up). He's being pulled this way and that and it's going to be a struggle to keep everyone happy. It's the Chancellor's biggest show-boating, grandstanding opportunity of the year - so exactly what is he going to say?

That very question has been racking up a lot of column inches this weekend. Richard Lambert, head of the CBI, has very kindly written the Chancellor's speech for him. Six short paragraphs putting off any serious decisions until the economic outlook is clearer. Oh and postponing 'anti-business' taxes. If there was a market for whether Darling will let the head of the CBI write his speeches, I'd be a big seller.

But the CBI haven't stopped there. They want corporation tax down from 28% to 18% over 8 years in order to keep the UK competitive. They want the Treasury to hand over business tax decisions to an independent body. They want children down mines and up chimneys. They want jam every day and ice cream on Sundays. In short, they want the moon on a stick (those TUC 'Soothe yourself to sleep' tapes are working a treat). The Chancellor needs to build some bridges with business but with the public finances in a perilous state, it's unlikely that he will hand out any serious tax cuts. However, one way to throw these guys a bone would be to back-track on the bungled CGT and non-dom tax proposals.

Any crumb of comfort from Darling will help to buoy the markets that have been taking a beating in recent times. For instance, good news on fuel duty will please consumers and business in light of crude oil topping $105 a barrel of late. Steps like that will help to alleviate inflationary pressure on the supply side of the economy, making rates cuts more likely which should please the markets.

The problem for the Treasury is that even without Northern Rock, the public finances are off track. With Northern Rock taken in to account, the government is going to break its own rule of keeping public debt below 40% of GDP. So while the economy may need a boost, the Chancellor has to keep the belt pretty tight. The Treasury are desperately clinging to the idea that the British economy will tough out the global economic downturn without a serious public spending splurge. There is some support for that view from purchases managers' surveys for manufacturing and services, but it will be a stretch to achieve 2% economic growth this year. How much faith the markets have in the Chancellor's predictions and solutions will influence which way they go this week.

Cometh the hour, cometh the eyebrows - will wee Alistair deliver a crowd-pleaser or a dour Scotsman's Budget? And if it's the former, which crowd will he please? And more importantly, how will the markets react? Enough questions, we need answers - find one and get your money behind it at ChoiceOdds.com.

The FTSE has fallen on 31 out of 47 trading days so far this year.

The DAX closed Friday on 6,513.99, only 129.59 ticks above its low of the year of 6,384.4 which was reached on 23rd January.

On Friday, the DOW closed below 12,000 for the first time since 22nd January.

Whichever of the US presidential candidate front-runners wins in November will be a first of some kind; either the first woman President, the first African-American or the first to be born outside the 50 states of the union.

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