Exploding Head and Vomit Emojis: Tory MPs on WhatsApp

And when you start of the government in Germany, you want to like someone, but you haven't really got lots of reasons to hate people specially and these just hate it. Yeah, that's such a good point and I thought that was really Dave shoul will try this again. I think we better so a little over twenty four hours ago we sat down and actually taped what we thought it was a fantastic episode with Catherin Griffith's brig editor on our

Finance team and UK Government report Alex Wickham. We picked over the potential for liz trust Is future, the outlook of our promises to the city. We all placed bets on when this trust would resign, should we take bets and when she goes, I've already lost. I have a bet day. But at day lettuce, Alex, when do you think she goes? I think this week before Sunday, before Saturday, before Saturday would be my bet. But I think today, you think today? One more day? Freaky podcast, hang on

one more day, so we get this podcast out. Please, she's listening. But this Trust did not hang on one more day. We couldn't get the episode out because Trust delivered her final goodbye. That's right, she beat us to it. And although we did all know it was coming at some point, you weren't sure how quickly. Because the point Alex made yesterday in the conversation, and what is still true now is that there is actually no obvious or

clear successor at this point. So that's it. We're back, with even more to unpack, and with the hopes that no major bombshells will redraw before this podcast is published. YEA, our edited that it get moving, get it out. I'm Francing Lack wend London studio, and I'm David Merritt's back from Washington. Not quite in the London studio. Yeah, but you made it back in time. This is in the City Bloomberg's podcast, connecting you to the stories and the

voices at the heart of the City of London. This week. What is going on in Westminster, that's all anyone is talking about. And do any of the Tory MPs raising their hand to be the next prime minister really excited the City of London. So with us again. Katherine Griffith's Bloombergy editor on our finance team, and the winner of yesterday has been on the timing of Lisztruss's departure. Katherin, you probably regret we didn't have a very expensive or not so expensive bottle of wine on the spet. I

definitely regret it. And for Alex Wickham, who's knee deep in writing about all of the drama, is another brilliant reporter from our government team, Ellen Milligan. We know the rules now of how the voting goes. I mean that they're trying to be pragmatists instead of you know, the big ideology maybe that we've seen the past from the Tory Party and they want to get this done fast. There were two really key details in the rules that were announced. One the candidates have to get at least

one MPs backing them. That means there's only a maximum of three people who can enter the race, and it also means that they have got a long way to go until Monday TPM when votes closed to garner that support. And really that means that the big beast boris Johnson, Richie seen a Penny Moore than't who have gone through this leadership race again. All three of them have got more than a hundred MP votes in previous leadership elections. They're probably going to be the most likely ones to

go through. The Other thing, which is really a usual, is that on Monday they're going to do an indicative vote where MPs can vote from those three who they want to win. Now that isn't binding, but it's indicative of what MP's one and I think that is to bounce whoever become second, maybe third in that vote into dropping out and not letting the race go in any longer, not letting it go to the membership, and making sure

that we have a prime minister on Monday. It's quite remarkable as it, because you know, we just we all went through this, didn't we all summer weeks and weeks and weeks of it being told this is the process that we need to identify the right leader, and turns out we can just do it in three days. I mean, it just doesn't It undermine all of the all of the rules that we were told were absolutely necessary. The Conservable they just sort of make it up as they

go along, don't think they do. And I mean it's designed like this to kind of give stability to the Conservative Party, but also the country is quickly as possible not have this long drawn out period. If it doesn't go to the membership, only Conservative MPs are going to decide who our next prime ministers. I mean, it's happened in the Labor Party. You didn't get as well. These rules of having the members choose you can sometimes end up with somebody doesn't work out right, That's the problem.

It depends who you ask. I mean the membership. If you look at those three, I mentioned Penny more than Boris Johnson. RICHI soon act the membership still love Boris Johnson. I think the if it does go to membership, the indicative vote of the MPs will actually have a different result what the membership will. So if I had this brilliant conversation with Tory MP Carl McCartney, he's bagging Boris Johnson. He's also been on the committee for all but two days,

so this is what he said about Boris Johnson. Ultimately, he's the best electoral asset that Conservative Party has and for the past three four months, all I've ever had from my constituents in my marginal seat in Lincoln is that they want to see Boris back. And that's whether they I'm business in this and speak to business people, whether that's constituency who I meet shopping in the various different supermarkets or even filling up my car, but not one person who is going to be and said, we're

really pleased that you got rid of Boris Johnson. And Boris Johnson really he can really be back. You know what, last night, I didn't think he could get enough MP support to be put on the ballot, but he's now garnered just just under the amount of support that Richie Soonac has. Ben Wallace has just announced that he's leaning towards Boris Johnson, that he's definitely not running. He's quite a big force. He's very respected in the party and it feels like it could happen. The thing with Boris

is he is an electoral powerhouse. I mean, he got the biggest a TC majority in in a in a generation in and he's still people still think he holds that magic, even though the polls were declining against him when when he was leaving office. But also Liz tra us is handling of the economy I think can make people look back and think, oh, he did was the really party in the pandemic. Sometimes it kind of relatively has almost kind of almost made him into this martyr

figure amongst some people and some Conservatives. But he's I mean, I have so many questions, but he's he's toxic. He's toxic for the party. He's probably their most divisive option to pick in terms of being able to unify the party. We've had um MPs saying that they would resign as an MP if if he was chosen and cause a by election. I mean that those are really strong words. And he's got this Privileges Committee into whether he lied

to Parliament over the party Gate scandal. If he's found guilty and if he's suspended for more than ten parliamentary days, if there is a vote, and that it could trigger a by election for him, I mean it could be chaos, a continuation of chaos if he's elected, and there are so many people Dave, you know, let's say he's just not the antidote to this chaos within parliament, Catherine, how would business interpret this? I mean, Boris Johnson becomes Prime

Minister on Monday, what does the city think. I think the city probably thinks, first of all, it's good to have a prime minister who is therefore hopefully a while. But Boris Johnson is a funny character for the city because, on the one hand he has he's been backed by some fairly rich city people who hoped he would bring about lots of Brexit dividend reforms, but he didn't actually do it. And someone made a really interesting point to me.

When you look back through the many, many thousands of words Boris Johnson wrote as a journalist, he hardly ever talked about markets or the economy. He's basically not that interested in all of that side of things. So I think that the city and business more generally would be probably more pleased to see, undoubtedly more pleased to see

Boris Johnson as Prime Minister. The Trust, although there is certainly contingent that was was on Lis trust's side and was hoping that she would bring about the things they wanted. But I think the city will be mainly looking for who is the chancellor? Is it Jeremy Hunt or is it someone else? Do you think there's a groundswell of support for Regie Synacore? But will there be a huge amount of relief if finally I mean we've had the

Liz interlude and the chaos that provoked. But if finally they get region akin ten Downing Street or the city actually breathe a huge side of relief. I think the city will because he has certainly in his own component to become the leader. Of course, he he was the voice of of caution, wasn't he? And obviously he's now kind of garnered by this sense that he was right

all a long type thing. And I think people who have followed his policies quite closely are of the view he's quite cautious that yes, sort of counterintuitively really well, despite the fact that he's worked for Goldman, Sachs and Hedge Funds, that he was very key to balance the books and be very very cautious. But there will be people out there who think that if he comes back he will kind of scupper the more dramatic bold attempts to sort of make the UK's rules, you know, properly

suit the UK. He's come to be seen as a sort of stick in the mud to all of those plans. He and John Glenn, who used to be the City Minister. So there'll be some people out there who are a bit worried about that. Ellen, if we oversimplify, is this really your choice for the party. On the one hand, if they elect Boris Johnson, there is a chance that he can win them the next general election two years.

But on the other hand, if they elect someone else but anymore don't Orgi Sunac, then they have almost a technocratic government. They could keep the chancellor, and so the

markets will you don't have a sigh of relief. There's two big questions that MP's are asking themselves when they're considering who to back one who can win them the next action or give them the best chance to considering their trailing so disastrously far behind in the polls, and to who can unify the party so that the Conservative

Party isn't completely destroyed from the inside. Boris Johnson, I think a lot of people say He's probably the gives them the best chance electorally, although there's so many there's so many things that Labor can attack him on that they that they started to towards the end of his tenure. But he's probably the worst in terms of being able to unify the party. Rischie Senac trust is backers still

really don't like Riscie Senac. There was all those blue on blue attacks, the nastiness over the summer um that still kind of play against him. And then Penny Mordant is able to get a lot of support from different factions in the party, but a lot of people question whether she's had enough experience, whether she's impressed people enough when she has been ministerial positions. Um so those are

the two big questions. In fact, Katherine, it was interesting what you were saying about Jeremy Hunt earlier because I think he could hold the key to who gets in, because I think people want to maybe not the Restaunson seeing as they renegates each other for the leadership in but I think Penny Morden and Richie Senac will be

fighting to have a joint ticket with Jeremy Hunt. He's managed to calm the market since he's come in um, the argument will be we need a degree of stability and the treasury um so that the October fiscal statement can go ahead. For example, He's done a good job so far calming things down, and I think he whoever he backs, could hold the key. Yeah. I just think

there's two questions really are just so important. And on the second one, though, I guess my thoughts is, you know, with all of them, with all of the backstabbing and the in fighting that we've seen, the victual being poured around this, this is a party at each other's throat. It doesn't feel or like any of those people are going to be able to calm down the party enough to hold a government together to get to that point. To watch the first question, which is whether or not

they can win an election. Is this kind of a party actually in terminal decline at the moment They just need to go into opposition. You know. I talked to some MPs who say, you know what, we're just going to have to accept that this time we might have to go with our second or our third choice and we just have to grin and Barrett, And then I talked to others who say, you know that they might resign from the Parliamentary Party if if certain people are

in gather. We also spoke to Vince Cable and he was talking about how Boris Johnson is still a very decisive but divisive figure that because of his conduct issues, well, I would worry about the consequences. So for several reasons. I mean, he's very divisive figure in the country and I would imagine with the Tory Planty there are not a conservative mass. I think we need to remember there only a few months ago a majority of these parliamentary

colleagues throw them out. Is unsuited to lead the country again. When you talk about the city of London, are they just fed up with the Tories because they say, look, they're putting once again party before country and what does that mean for how business friendly they think labor is. Yeah,

they really are fed up with the Tories. What's been quite striking in the last few weeks is when you talk to really senior people inside big financial institutions, they tend to be quite measured, even if they're speaking off the record. They don't really like talking about politics a great deal and certainly not about individuals. But there has been an absolute fury amongst some of these very senior

bankers and people in other firms. They think that in other walks of life, these people would have had to be held accountable, they would have been act much more quickly. You know. It's a real, absolute sort of white hot fury that you see in their faces, and it's I haven't really seen it before in all my years of reporting. Talking about the white hot fury of the bankers is remarkable. And is there anything that the government can do to

assuaise that? I mean, one of the main measures that the next administration need to put in place to to study the ship and reassure the city of London that things are going to get better. They absolutely want stability and clear plans. They know the economic reality is tough, and actually, in some ways I think there are of the view that a lot of these difficult things were coming down the path anyway, higher interest rates, meaning higher

mortgage costs for their for customers. But you know, the Tory Party, in a sort of act of self sabotage, has really sort of owned those problems in a way that they might they might not have to have done.

But in terms of policy they want, they really do want stability and physical prudence because they think that that might mean that the Bank of England does not in fact have to raise rates by quite as much as it would otherwise have to do, and that will have a really material impact on people who have mortgages, people who have loans, and the wider economy. And then I think they do want a sort of sensible thought out set of ideas for how in fact there can be

investment in this country. They're obviously extremely keen to to be part of that story. They just want to see stability so they can get on with it. But again, where does the stability come from? So again it's the same party, But you saw this trust lasted forty four days with radical economic plans. Frankly, so if you're looking out the policies and we don't know them because they don't have time to campaign between plenty more, don't Boris

Johnson and Richie Suonac, how different are they? I think I think they have a sense of what Richie Sunac would be like. They've seen obviously Boris Johnson in action, and I think they probably think that can be navigated. I think they honestly have no idea what Penny Mordant would be like whatsoever. But increasingly when you do speak to business and the city, they say they're not really bothering with any of the Tories. They are engaging with

the Labor Party. They are talking to Rachel Reeves. They are pretty encouraged by kir Starmer. And something I was really struck by. I had a conversation with someone who works at a big private equity firm and they made exactly this point that they were only engaging with the Labor Party at the moment. And I said, well, you know, but what if Starmer comes in and they do do a wealth tax or they hike up the inheritance sax.

You know what, actually do you think about that? And they said the view inside their firm, which is made up of lots of American people, lots of people from the continent, was that it's okay as long as it's not really egregious, not really sort of outside the norms

of what they think are acceptable. They would prefer to see a labor government that's a pragmatic bunch, aren't they really work with what they pragmas budge And you know this firm in particular, they're they're holding back on investment in the UK until they know what the hell is going on, So you know, for for the UK's growth,

that's absolutely terrible. The really tricky thing that the Tories have at the moment is Jeremy Hunt has been able to calm markets because he's rowed back on those tax cuts which would have required a lot of borrowing, and spending cuts are now on the cards and that and that calms markets because it means less borrowing, but it's

politically really tricky for them. So getting that balance right between continuing to calm the markets and can't they still need to cut They have some way to go to really calm them more, but also not politically damaging themselves so much that they're making spending cuts to the NHS and to police and these things, which, to be honest, might be required if they want to fail that whole that they really need to And that balance I think is going to be really really hard to strike on

the October th fst if indeed it still happens at the end of the month. If it happens, so we've had for four days, frankly chaos on the markets. Is there a believe Catherine that the I guess extreme right extreme left on both parties is now shaken out because they do have to to, you know, work in the

parameter of the markets. Yes, I think that's one sort of slight positive perhaps that there's a perception that on the left we've gone through a period when the kind of corbinate Corbin nights were in the ascendant and that

absolutely horrified business in the city. But actually also on the right, I think there's a lot of sort of views in mainstream finance that they thought the voices that people like Liz Trust and quasi Quarte and we're listening to work extremely unhelpful for the kind of UK's long

term prospects. That they had sort of fairly niche ideas about what they claimed Brexit meant but didn't necessarily actually serve the wider interests of the country, to do with sort of tax cuts for nondoms and all sorts of

libertarians small smaller state ideas. So I do think that in mainstream finance they think that if those people can be cut out as a as a result of all of this political chaos, starts a good thing, and then you have to indulge me because I know we're all obsessed with politics and the economy and markets, but I'm also obsessed with WhatsApp groups of the Conservative Party. They

have emojis. I mean, like, do we know what Alex Wicken was telling us yesterday that you know, they would kind of send names to each other of who could run or who could be chancellor. And there were a lot of like exploding brain emojis and a lot of vomit emo. I have one unnamed MP pretty much only communicates with me by emojis. There's very colorful language as well in Conservative Party WhatsApp groups, and there's a lot of exploding heads. I had a um an ex minister

send me an exploding head after she resigned. No one saw it coming that quickly, and I just this is how we communicate with Dave. But I'm a journalist, so he's like, what you can't write in sentences just emos. You know those word clouds that polling companies have been doing, and they should do that with purely emojis. And see one in the middle. Welcome to the future. Thank you so much, Thank you, thanks for listening to this week's

in the City. We'll be back next week. But in the meantime, if you like our show, please head on over to Apple Podcasts or wherever you listen to podcasts and rate, review and subscribe. Also sign up now for a newsletter, The read Out with a Legra Stratton on Bloomberg dot com Slash Newsletters, or check out the show notes for a link. And you know what else you should now sign up for our new daily newsletter, Money Distilled, where Bloomberg UK's John Steppek explains what market moves mean

for your money. This episode was hosted by ME Friends in Laquax and Me David Merritt. It was produced by Summersadi Special thanks to Catherine Griffith's Ellen Milligan and Alex Wickham