Gordon Brown is losing friends among gamblers.

Punters on Betfair, an online betting exchange that works like a stock market, now think there is just a 23 per cent chance of him winning  a majority at the next election.

That means he has now slipped behind Tony Blair — who had better prospects of winning a majority at the height of his unpopularity.

You can see the “Blair trough” and the “Brown low” in this graph, which shows the trends in betting on Labour winning a majority since the 2005 election.

The lengthening of the odds on Brown has accelerated in recent weeks.

The Conservatives, meanwhile, have moved up to 40 per cent — making a Tory majority the most likely outcome at the next election.

All three parties are playing down their prospects at the May 1 local elections. Even the Tories, who seem most likely to come out with more council seats.

But Labour and the Conservatives are both claiming to be fielding more candidates - according to press releases that came out this afternoon.

Eh?

The difference, apparently, is that Labour is counting England and Wales and the Tories - bizarrely - are ignoring the Welsh.  

It seems odd given what has happened since.

But a bill* published last year gave new powers to building societies to borrow more from the wholesale markets. That is, the ones which enabled Northern Rock to grow like topsy and then implode. The bill has increased the maximum wholesale borrowing level from 50 per cent to 75 per cent.  

Luckily, the timing means few if any building societies will have taken advantage of this new freedom. Even if they wanted to - unlikely given the Rock disaster - the credit markets have been frozen.

The purpose of the change was to place building societies on a level playing field with banks. In theory this could help create more long-term (25-year) fixed mortgages, something which Gordon Brown is keen on.

Lord Davies of Oldham, deputy chief whip in the Lords, told a debate in October that “in the light of recent events in wider financial markets, we will want to consider carefully whether such a power should be used.”

Later he added:

“The concentration of funding will also pose risks that need to be effectively managed by firms. The recent case of Northern Rock is a clear example of the importance of risk management in this regard.”

Just when the government should have been worried about the growing credit bubble they were taking steps to encourage building societies - Britain’s most prudent lenders - to loosen up. Bizarre in retrospect.  

   * Building societies [funding] and Mutual Societies (Transfers) Bill

This will not please our elected representatives.

John Ralfe, the former head of corporate finance at Boots and an indefatigable apostle for the cause of trimming MPs’ “outrageous” pensions, has just  launched his latest assault.

In a submission to the Sir John Baker’s review of MPs’ pay, he has analysed the true cost to the taxpayer of the parliamentary pension scheme. His conclusion: for the scheme is to truly represent its stated cost to the public purse, it should be cut in half.

The cost of the MPs scheme is double the official estimate because the government actuary uses aggressive and over-optimistic assumptions about longevity and future returns from the stock market, according to Mr Ralfe. (This is explained in more detail here.)

In his submission, Ralfe tantalisingly outlines what we would need to take away from MPs to rectify the imbalance.

He says we should reduce the annual pension accrual from 1/40th to 1/60th (which basically trim the pension from about £1,500 a year to £1,000), move from final salary to career average, and impose a 2.5 per cent inflation cap. This will bring MPs in line with most other pension schemes in the country.

Can you hear the pips squeaking?

There has been a lot of fuzzy language used to describe those that will be punished by Gordon Brown’s 2007 Budget. News reports have suggested it will hit “low-paid workers” — Labour’s core vote. The implication has been that “middle-England” swing voters will benefit or go unscathed.

The full picture is more complicated. More than a third of middle income households will be worse off, according to this excellent Joseph Rowntree Foundation report on an unrelated subject. Holly Sutherland led a team that calculated the impact of the 2007 Budget. Her analysis largely tallied with the IFS (who own the only other non-governmental model to do this kind of analysis) but she chose a slightly different way of presenting some of the information (see the chart below).

While about a quarter of households will lose out from the budget, this disproportionately hits middle income households. A smaller percentage of rich and poor households will see their incomes fall (although they could lose more).

When journalists describe “low paid workers” they are also describing households that could have a combined income of £36,000 — which puts them right in the middle of the household income distribution curve. These couples, who don’t have kids, will soon feel the pinch in their monthly pay packet.

Some Labour MPs have suggested to me that unrest over the 10p rate is a matter of principle with limited electoral implications. This graph suggests that may be wishful thinking.

The man from the Halifax sounded quite convincing on the Today programme this morning when he said house prices wouldn’t fall much - because the labour market was sound.

This is the line we have been spun for ages by the government. (It was repeated this morning in an editorial in The Times). It doesn’t ring true.

The problem is that last time around - nearly 20 years ago - employment did not go into meltdown until nearly a year after house prices started to fall. Just as is now happening in the US.

The UK housing market peaked in 1989. Employment kept on rising and peaked in April 1990. Before dropping like a stone.

If this sounds unlikely, check out the chart supplied by our friends at Bloomberg. It augurs very badly indeed. Meanwhile, check out the Spectator blog for an accurate take on Gordon’s “no recession” strategy is faring.

Back in 1978, Argentina was preparing to host the World Cup. The fact that the military junta had by then purged the nation of thousands of dissidents and that one of the biggest torture and death camps was a few hundreds yards away from the River Plate stadium mattered not a jot to FIFA, the world governing body, the participating nations, and the fans.

But thirty years on, China has a problem on its hands, unless it smartens up its human rights image. When you have global internet, and rolling 24-hour satellite TV, the phrase, the “whole world’s watching you” takes on a different meaning.

It forces participitants to examine their consciences, and turns ‘Absolutely Fabulous’ actress Joanna Lumley into a sure candidate for the first female Archbishop of Canterbury.

Fresh from delivering her flowers at Prince Philip’s sick-bed, the gorgeous Joanna told the world, care of the BBC, that through the ages light can have the power to break through the darkness. The Olympic torch, she told us, is already working in mysterious ways, as it makes its progress through the world, shining a light on China’s human rights record.

As the FT exclusively revealed last week, the Chinese have enlisted the support of a PR company to limit the damage to its reputation of its brutal record in Tibet and elsewhere.

They should get a simple world of advice. Start loosening the political straitjacket, and engage constructively with the Dalai Lama, while reminding the world of China’s status as a major political and economic power-one the world cannot afford to boycott.

There was a bit of a space-crunch in Saturday’s paper, so were were unable to run a piece looking at the impact of the credit crunch on public confidence in the economy. The basis for it was a remarkable Ipsos poll showing that economic optimism had fallen to its lowest level since the early 80s, when Britain was experiencing its most severe post-war recession.

It is hard to imagine that voters really are that pessimistic. After all, 28 years ago inflation was approaching 20 per cent and interest rates were well-clear of 15 per cent. Anyone with doubts should take a look at these charts, which were kindly put together by Jerry Latter at Mori. They really do underline the scale of the political challenge faced by Gordon Brown.

But there is an odd trend illustrated by the graph that may work in Mr Brown’s favour. For the past six years, we appear to have gone through the “gloomy boom”. Even though house prices were rocketing, money was cheap and unemployment was low, people were more pessimistic than the last years of the Major government. Indeed at times they were more pessimistic than during the 1991 recession. How is that possible?

The peculiar gloom during the noughties does somewhat undermine my next question: is economic confidence a leading indicator for confidence in the government? The chart below is inconclusive. While economic optimism came before faith in government during the Thatcher era, the track record is much more mixed during the Major and Brown years. However the sharp fall in recent months will undoubtedly be worrying Mr Brown’s pollsters.

I’ve no idea if this one is true. It came to me from a Labour MP who is no fan of the PM.

But apparently Gordon Brown recently got through three mobile phones in one week by hurling them against the wall in anger.

Could be nonsense. However, the fact that it seems even remotely believable is a sign of the times.

There is a startling statement buried near the end of this NY Times report about Nuri al-Maliki’s ill fated offensive in Basra:

the Iraqis did not trust the British and were not including them in their planning, according to a senior American officer.

From what British officials tell me, the lack of trust is mutual (and that is putting it politely).