Liz Truss resigned as the Prime Minster of the UK yesterday, after just 6 weeks on the job. Just a day before, she proclaimed “I am a fighter, not a quitter”. But the conservative party is fed up with her. She announced her resignation after many cabinet members quit. Her unfunded tax cut and spending plan sent the British pound to all-time low and British government bond yield to all-time high. The conservative party, once led by legendary leaders such as Winston Churchill and Margaret Thatcher, is in chaos. It doesn’t appear the party has a strong plan to put a credible leader in place to lead the British people through the challenges in the post pandemic world.
The new Prime Minister is going to have a super tough job. UK inflation reached a 40-year high of 10.1% in September. GBP to USD went from 1.35 at the beginning of the year to 1.11 today, a 18% drop. They have lost their reserve currency status and international investors have concerns about the UK's economic future. Their Q2 GDP shrank 0.1%. I hope Boris Johnson doesn’t end up coming back and they find someone new to make it work.