In this episode of the FT News Briefing, host Mark Filipino covers major global political and economic developments. He is joined by the Financial Times' political team, including Whitehall editor Lucy Fisher, political editor George Parker, and deputy political editor Jim Pickard, to discuss the sudden resignation of UK Prime Minister Keir Starmer. Additionally, the FT's Andean correspondent, Joe Daniels, provides on-the-ground reporting from Colombia regarding the country's recent presidential election and the resurgence of drug-related violence.

The briefing first details the political vacuum in Westminster following Starmer's exit and Andy Burnham's uncontested bid for leadership. It then transitions to the financial sector, highlighting a massive surge in private equity executives borrowing against future profits amid a prolonged industry downturn. Finally, the episode examines Colombia's security crisis, the election of right-wing Abelardo de Espriella, and concludes with a retrospective on the legacy of former Federal Reserve Chair Alan Greenspan, who passed away at the age of 100.

UK Leadership Crisis and the Rise of Andy Burnham

Keir Starmer announced his resignation as UK Prime Minister following the Makerfield by-election, leaving Greater Manchester Mayor Andy Burnham as the frontrunner.

"If you poke some of his ideas enough, they start to fall apart." - George. Parker noted Burnham's policy prospectus remains untested, citing his abandoned proposal to exclude defense spending from fiscal rules.

Westminster is experiencing unprecedented institutional churn, with the UK poised to welcome its seventh prime minister and eighth chancellor in just ten years.

"We as a country or as a political Westminster bubble are far too led by opinion polls." - Jim. Pickard criticized the media and political class for creating self-fulfilling prophecies of leadership downfalls.

Private Equity Executives Leverage Future Profits

Buyout dealmakers across Europe are increasingly seeking loans secured against their personal shares of future profits, known as carried interest.

London broker Ennis Global reported that inquiries for these specialized loans have more than tripled this year compared to the same period in 2023.

The surge in borrowing is driven by a private equity downturn triggered by the 2022 interest rate hikes, which forced firms to hold assets longer and delayed cash payouts.

Colombia's Security Vacuum and Right-Wing Shift

Colombia's 2016 peace agreement with FARC demobilized the major guerrilla group but created a power vacuum now contested by smaller, highly violent dissident factions.

"The global market for cocaine only continues to grow. And the price of gold is way up on where it was 10 years ago." - Joe. Daniels explained that these lucrative illegal economies are fueling the conflict.

Newly elected right-wing President Abelardo de Espriella has promised a severe military crackdown, drawing inspiration from El Salvador's Nayib Bukele to build massive prisons.

The rise of tough-on-crime political candidates is a broader Latin American trend, with similar right-wing victories occurring recently in Chile and Honduras.

The Economic Legacy of Fed Chair Alan Greenspan

Former Federal Reserve Chairman Alan Greenspan has died at the age of 100, after leading the US central bank for nearly two decades from 1987 to 2006.

While Greenspan was widely praised for presiding over rapid US economic growth in the 1990s, he faced severe criticism for failing to anticipate the 2008 financial crisis.

Greenspan's tenure was marked by a belief in self-regulation, which critics argue contributed to the housing bubble and subsequent global market collapse.