Matthew Lynn

Matthew Lynn is a financial columnist and author of ‘Bust: Greece, The Euro and The Sovereign Debt Crisis’ and ‘The Long Depression: The Slump of 2008 to 2031’

Britain should break the taboo on ‘challenge vaccines’

So far, so good: the Oxford university trials on a potential vaccine for Covid-19 is reported to be going well. It has been tested on more than a thousand people, and it looks to be safe. There is another, more important question, however, and one where an answer might take a frustratingly long time. Does

Sunak’s furlough scheme is a victim of its own success

Who are we kidding? If you are still furloughed through July, August, and September, the chances are that your job isn’t on hold as you wait for lockdown to gradually be lifted or for your company to get back to normal levels of demand. In truth, you have probably been fired. It’s just that no

A German court has plunged the eurozone into fresh crisis

An epidemic has been raging across the continent. The economy is in lockdown, and GDP is in freefall. But, hey, just when you thought things couldn’t get any worse in the eurozone it now has a financial and currency crisis as well, and one that is being made worse by the week with the shambolic

Is the furlough scheme too generous to be stopped?

You can get 80 per cent of your salary, and sometimes even 100 per cent, without actually working. Companies are getting virtually free loans, and can dump their often troublesome staff on the Treasury payroll, and entrepreneurs can get direct injections of cash from the state without actually having to launch any products. Sure we

Macron talks grandly about Europe – and then cuts a deal with Germany

Emmanuel Macron is, for all his carefully polished image as a radical moderniser (and with the possible exception of not having multiple mistresses), a very traditional French president. He protects domestic industries, especially if they happen to manufacture cars or guns. He subsidises farmers, sends soldiers to small African states, and accumulates more and more

Ursula von der Leyen and the EU owe Italy more than an apology

Italy’s hospitals have been overwhelmed. Its mortality rate is among the highest in the world. Its economy has cratered, its bond yields have soared. And it is starting to drown under the weight of its accumulated debts. But, hey, at least the EU commission president Ursula von der Leyen feels sorry about the way Italy has

Ursula von der Leyen’s ‘Marshall Plan’ is doomed

Solidarity will be strengthened. Countries will find new ways to co-operate. And Brussels will support the economy, making sure the strong support the weak. European Commission president Ursula von der Leyen is set to unveil the EU’s response to the coronavirus crisis, promising a ‘new Marshall Plan’ to prevent the continent plunging into deep recession. It

The Bank of England’s big coronavirus gamble

Ten billion here. Twenty billion there. At least we now know where Rishi Sunak is getting all the money from. As of today, the Bank of England has quietly started directly financing the government. Instead of selling gilts to fund the difference between what it raises in taxes and what it spends the Bank is

Coronavirus has again exposed the euro’s fatal flaw

Rising death rates. Economies closing down. People forced to stay at home. The coronavirus is a health, social and economic emergency for every country where it hits. But in Europe it has also mutated very quickly into something else as well, and which, while it may not be quite so threatening in the short-term, could

Rishi Sunak has badly miscalculated his coronavirus bailout

Ten billion? Twenty billion? Thirty billion? To borrow a phrase from the American senator Everett Dirksen when scrutinising the escalating costs of the military, ‘pretty soon you are talking about real money.’ Chancellor Rishi Sunak has already thrown huge sums of money at rescuing the economy. He may well spend a lot more over the

Self-employed workers richly deserve a coronavirus bail-out

It will be impossible to calculate. There will be widespread fraud. And there is no mechanism for sending out the money. As the Chancellor Rishi Sunak scratches around for ways to bail out the UK’s five million self-employed in the same way he has done for employees he faces plenty of obstacles. No doubt his Treasury

Rishi Sunak’s wartime economy

At least no one can say it isn’t bold. The United States is fiddling around with some possible cuts to payroll taxes. Most of Europe is stuck with some printed money from the ECB. But the UK is embarking on one of the most radical experiments in modern economic theory, and one that will no

Tory taboos must be broken in the fight against coronavirus

A £330 billion package of loans to business. A huge tax break to any company in the hospitality or leisure industry. Mortgage holidays to anyone who has been impacted by the coronavirus. People can accuse the Government of being behind the curve on delaying the spread of Covid-19 through the population. But it is hard

The eurozone’s coronavirus response has been dire

A dramatic dawn cut in interest rates. A huge blast of public spending. And immediate cash help for companies that might find themselves temporarily in trouble as their customers stay at home and staff call in sick. We will find out over the next few weeks whether the British government has done enough to fight

Sunak’s leaked tax plan sends precisely the wrong message

It is too expensive. It mostly goes to Southerners who already have plenty of money. And it doesn’t even work very well, while the money would be better spent elsewhere. As the Chancellor puts the finishing touches to his Budget, the leaks suggest that the most generous tax relief for entrepreneurs will either be curbed,

Three ways to stop a coronavirus recession

Supply chains are shutting down. Factories and offices are closing. Flights are being cancelled, conferences postponed and football and rugby games rescheduled. It remains to be seen how much of a blow the spread of the coronavirus turns into for the global economy. But one thing is now certain: it is going to lead to

Trade friction with the EU is nothing to be afraid of

We will export less. There will be less competition. Prices will be higher and productivity lower. Textbook economics tells us that trade friction – that is anything that makes it harder for goods or services to flow across borders – is a very bad thing. So why is the British Government suddenly accepting trade frictions