An inside Bank job?

We read that the two front running candidates for the very powerful new post of Governor of the Bank of England are Paul Tucker, Deputy Governor, and Lord Turner, retiring Chairman of the FSA.

The advert for the post made clear that was what the establishment wanted. The ad said “The successful candidate will have experience of working in, or with a central bank or similar institution; or will have worked at the most senior level in a major bank or other financial institution”.

As there are no similar institutions to Central banks, the ad might as well have said “Insiders only need apply”. It immediately put off talented people who do not wish to see their current jobs disrupted by a media storm over their application, and who saw their chances would be slim at best. Those few who have run large UK based commercial banks have been largely ruled out by the hurricane of criticism that have surrounded them and their institutions in recent months. No-one would want to apply to be Governor if they had been at or near the top of a leading bank through the Libor crisis. They would know that their application would bring that all out again on a large scale.

The new post will be uniquely powerful. The new Governor will have all the powers over money, interest rates and markets that the outgoing Governor has enjoyed, and most of the powers over financial institutions that the outgoing Chairman of the FSA has enjoyed. The Governor will be both chairman of the Monetary Policy Committee, and of the Financial Policy Committee, bringing together the task of setting interest rates and the job of controlling banks and near banks.

I have nothing personally against the two front runners. They are both clever and hard working men. I do have a great sense of apprehension that the UK establishment wishes to recruit an establishment figure at this time when the Central Bank has presided over disaster after disaster, and when on its own admission the FSA failed to regulate well. The leading members of the elite club have been the people who have made all the wrong calls. Why should they now be trusted to find the antidote to their collective mistakes?

Most of the financial establishment have:

1. Supported the ruinous experiment of the ERM. The Bank was in the forefront of pushing that, when a few of us explained patiently it would end unsustainably in inflation or recession. It ended in both!
2. Argued for UK membership of the Euro. They now agree that was wrong. Thank heavens we on the outside won that one, with the help of the British people.
3. Argued in 2005-7 that there was a new world where banks could borrow on a collosal scale safely, where external credit could work its magic without fear of non payment and collapse. They ignored the opposition parties and commentators who said there was excessive debt in the system.
4. Decided in 2007 to starve the markets of money, bringing down Northern Rock in an entirely predictable way. They refused to heed the warnings of those of us who said they had lurched to money that was far too tight, which would in turn undermine the whole banking system.
5. Decided in 2008 to take most of RBS into public ownership, and decided to back a takeover of HBOS by Lloyds, driving that too into the arms of the state. They ignored those few of us who said the overextended banks needed to be propped with short term lending against security, and made to slim down and realise assets there and then, to sort them out. Depositors should have been protected, and shareholders and bondholders made to pay for the losses.
6. Embarked on a massive QE programme, whilst at the same time squeezing banks further with high cash and capital demands. They declined to listen to critics who pointed out that they would not finance a private sector led recovery if the banks could not lend on the extra money created. They ignored those of us who also urged them to control inflation better, to allow real incomes to recover sooner.

Lord Turner in his latest speech now acknowledges the errors he made over the Euro and over permitting too much expansion of bank balance sheets prior to 2007. All the insider candidates should be asked to tell us what they have learned from a stunning list of long term fundamental errors in their approach to UK banking and monetary policy. Never before has so much financial damage been done to so many by so few.

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184 Comments

  1. les
    Posted October 15, 2012 at 5:20 am | Permalink

    I think even I deserve the job more than Turner!

    • Disaffected
      Posted October 15, 2012 at 8:27 am | Permalink

      A good start would be to clear out the lefty dons at Oxbridge- a good role for social engineering to bring a balance to influence our future parliamentarians- because 25% of MPs attend there and the majority of ministers also attended there- it is like a statutory requirement and badge for office to have attended Oxbridge. Therefore Cameron ought to ask Milburn why he has not come up with this idea and how he intends to implement it. We might, just might, get a balanced view in the establishment, also the BoE, whether the UK should or should not be in the EU. Who knows, the BoE could start to act independently and free from the EU regulation, as JR pointed out on this site recently. I seem to recall it was claimed that the FSA implements 70-75% of rules which emanate from the EU on banking regulation.

      The USSR infiltrated Oxbridge to get to the heart of the UK establishment, namely security services, and not much has changed since then. So we need more conservative Dons to influence those leaders in the civil service, diplomatic service, FSA, useless quangos and parliament as they all pass through Oxbridge to their predestined roles that affect our lives.

      I am starting to wonder whether the EU imposed unemployment of Greece, Spain, Portugal is another EU strategy to force migration across the EU in the plight to look for work in the same way as Eastern European countries, formerly within the Soviet bloc? There must be a purpose to this cruel inhumane financial act beyond the fanatical austerity programme. It must be part of the overall fanatical dream to create the EU superstate.

      • Disaffected
        Posted October 15, 2012 at 8:31 am | Permalink

        Boris Johnson’s article today claims that : “Vince Cable yesterday warned of “absolutely incalculable” consequences if the eurozone should rupture – but what does he think is happening now?” I presume it is to scare people to help the fanatical Lib Dem dream of an EU superstate of which the Uk will become a region.

        • lifelogic
          Posted October 15, 2012 at 10:06 am | Permalink

          Sounds a bit like the LibDems absurd warning on global warming too “absolutely incalculable consequences”.

          Could the “anti” business secretary not just do something for businesses that are trying to grow and take people on. Easy hire and fire, cheap energy and some functional lending banks for a good start please.

          • Pleb
            Posted October 15, 2012 at 12:38 pm | Permalink

            Swivel eyed federalists look on as Europe is subsumed into a forth richt.

          • Bazman
            Posted October 15, 2012 at 5:09 pm | Permalink

            As I challenged you in John’s Mr Cameron speaks well ‘ You are unable to defend your silly fantasy about easy hire and fire and will not reply to any points. As this is the case can you please stop posting touchy feely right wing propaganda with no defensible basis. Just because you think something is right does not make it so. Have you also changed your mind about this absurd idea you have about turning railway tracks into roads. Again if you cannot defend this argument why do you still believe it and have the audacity to accuse organisations and individuals of just believing with no logic and basis?
            I await your logical and coherent reply on easy hire and fire and nothing else.

          • lifelogic
            Posted October 16, 2012 at 3:07 am | Permalink

            @Bazman

            Surely you can see that if a business wants to hire someone the risks of not being able to get rid of them, should demand change or they prove to be useless, is a large deterrent. So many, do not then choose to expand.

            Businesses who are forced to retain second rate staff are clearly less efficient and less able to win new orders and expand too. It furthermore has a depressing effect on other employees.

            Many minor rail tracks are under used, to such a degree, that turning the tracks into roads, building plots or some other use would clearly be far more sensible. Trains, after all, are only essentially big buses, that are hugely restricted to certain limited fixed routes. Buses and coaches are so much more flexible, can go almost door to door and are cheaper to run in many circumstances.

            If you cannot see this, I cannot help you.

          • Mark W
            Posted October 16, 2012 at 2:28 pm | Permalink

            I’m sorry to say Lifelogic that I’m with Bazman on the issue of employment rights.

            As an employer, I don’t really find the rights of employees are too extreme and prevent me employing anyone. Admittedly I enusre that a contract of employement is put together with care and covers all areas that would be of concern to me. Even with 24 month returning I still issue contracts, (I have very low turn over of staff) with only a six month period, as I find that any unsuitability will rise to the surface far quicker and find little to gain of having newer staff have a fear factor hanging over them.

            From experience of hearing issues that other employers I know have suffered, I generally find that it is not following due process that gets employers into trouble.

          • Mark W
            Posted October 16, 2012 at 2:32 pm | Permalink

            By 6 months and 24 months, I’m refering to trial period not length of contracts. I’m not a supporter of short term contracts unless there is a very good reason, and as a side step to employement protection, that is a poor reason.

          • lifelogic
            Posted October 16, 2012 at 3:41 pm | Permalink

            @ Mark- I think it depends on the industry and the job type but I do find employment legislation very time consuming, distracting and potentially very expensive too even if you are in the right. Perhaps you have been lucky.

          • Bazman
            Posted October 16, 2012 at 5:20 pm | Permalink

            ‘If you cannot see this, I cannot help you.’ Good point. Maybe we could do the same to minor roads that are under used by your ‘logic? Minor railways are to narrow for for coaches so what you are saying is cut the transport infrastructure. Have you actually read any of the points made in previous posts or do you think your belief just automatically covers them like some sort of fundamentalist priest? You have the cheek to to talk of blind beliefs? What a laugh. The BBC are just arty lefty PPE? What are you then?
            We need some arguments against the points made, and if you are unable to give any then you should stop writing your unsubstantiated and indefensible drivel.

        • lifelogic
          Posted October 15, 2012 at 12:07 pm | Permalink

          Now I read the hugely depressing letter from Ed Davey’s to the times today:

          Sir, Neither I nor anyone in government wants to avoid our legally binding targets to cut the UK’s carbon emissions ……….

          Why on earth not? Are we to assume everyone the government is mad. I see he is yet another Oxford Philosophy, Politics and Economics man, and a head boy at school. Both are very worrying signs in my experience.

          Could some government engineers not explain the engineering & economics and the damaging insanity of their green religion agenda.

          • Robert Christopher
            Posted October 15, 2012 at 3:19 pm | Permalink

            lifelogic, please be logical!

            Engineers able to explain this damaging insanity do not get employed by the Government.

          • Bazman
            Posted October 15, 2012 at 5:12 pm | Permalink

            How about your easy hire and fire, and the private sector could just fill in the gaps religion?

          • Electro-Kevin
            Posted October 15, 2012 at 5:59 pm | Permalink

            Lifelogic – The squeeze on living standards is reducing household consumption.

            This never seems to factor in the assessments of the cuts in emissions.

            Nor does the reduction of carbon emissions ever seem to factor in the call for more im…

            No. Shan’t say it.

          • lifelogic
            Posted October 16, 2012 at 3:09 am | Permalink

            @Robert – I think there are some employed, but they know their rational views are not what the top wish to hear.

          • Bazman
            Posted October 16, 2012 at 5:22 pm | Permalink

            Rational does not mean simplistic as many of you arguments are.

      • uanime5
        Posted October 15, 2012 at 4:21 pm | Permalink

        Do you have any evidence that the USSR ever infiltrated Oxbridge or did you just assume it happened because it fits with your right wing delusions?

        Given that the USSR ended in 1991 why do you still think that the USSR is involved in UK universities?

        • Mark W
          Posted October 16, 2012 at 2:34 pm | Permalink

          Google “Antonio Gramsci”

          I think you’ll find all you need to know about the marxist infiltration of educational establishments.

          • lifelogic
            Posted October 16, 2012 at 3:43 pm | Permalink

            They certainly are infiltrated with much BBC green, lefty think, as are many charities too whatever actually caused it.

          • Mark W
            Posted October 16, 2012 at 6:02 pm | Permalink

            Charities are in many cases largely government funded, and then lobby government to do things there would never be an electoral mandate for. Too many single issue pressure groups pretending to be charities.

          • Bazman
            Posted October 17, 2012 at 5:28 pm | Permalink

            If anything it has been the failure of the left to check right wing delusions and fantasies such as banking that is much to blame. Labour in effect believing bankers and anyone who said this could be risky being told that they should just believe in the markets and the rest just believing the church of free market economics when often no free market exists or can ever do with the belief that the European peasant can return and be happy with their lot.

          • Bazman
            Posted October 17, 2012 at 5:31 pm | Permalink

            He died in 1937.

          • Mark W
            Posted October 17, 2012 at 6:57 pm | Permalink

            I wasn’t referring to his date if death, rather his political genius. The right wing never have any thinkers of his calibre, with regard to manipulation of the minds if the masses. I rather thought you and your pal would find him fascinating.

        • lifelogic
          Posted October 17, 2012 at 3:35 pm | Permalink

          I certainly agree on charities they should tighten up the rules so charity actually meant real charity. Not political lobby groups.

  2. John Ward
    Posted October 15, 2012 at 5:37 am | Permalink

    An outstanding piece from easily the most independent voice in the Conservative parliamentary Party.
    I think that the current Deputy Governor still has some questions to answer in relation to the Diamond affair, although I doubt he will ever be asked them. And Lord Turner proved to be, let’s face it, a toothless regulator.
    Far better candidates like Jim O’Neill are tainted by banking firm malfeasance…and anyway not interested in a job where real decision-making will fall to those woefully unqualified to take decisions objectively.
    Finally, it does seem to me to be extremely unfortunate that a bank of which we own 82% is attempting to redress its balance sheet by the systemic use of sharp practice.
    (refers to a blog posting which suggest RBS now wants easier repossession/faster repayment of outstanding loans etc.)

    • bj'sputer
      Posted October 15, 2012 at 7:49 am | Permalink

      “An outstanding piece from easily the most independent voice in the Conservative parliamentary Party.”

      Fully agree, Mr Ward. And increasingly willing to express those independent views it seems to me. Most refreshing.

    • lifelogic
      Posted October 15, 2012 at 12:12 pm | Permalink

      RBS/Natwest are behaving totally appallingly – a one bank recession machine owned by the state and shooting the country and tax payers in the foot.

      “Helpful Banking” as they absurdly claim in the adds, can the ASA not intervene on ground of lack of honesty?

    • nicol sinclair
      Posted October 15, 2012 at 1:11 pm | Permalink

      Johns Ward & Redwood,

      Allow me, if you will, a little (actually quite a large) rant. My first account was with the Royal Bank of Scotland, as it was known at the time, in the Branch Office at 4 Brandon Terrace, Edinburgh. The BRANCH Manager was a lovely man called Mr White. I was 17. He was older – much. The account number was 170499. Subsequently, at the age of about 25, I passed a cheque that bounced. When I enquired as to why they had not honoured my cheque, I was told that 170499 was no longer a valid a/c number. Why? “We’ve closed your branch and moved it to HQ.” ” Why didn’t you tell me?” Silence. (Is golden when one has nothing to say.)

      There is a lesson here for a 25-year old. I should have foreseen the way the banking industry was moving. No more personal Branch Managers who understood their customers and could read peoples’ intentions. Instead, a global behemoth was in the room and RBS (how uncool is that?) was brought to its knees by the ‘Shred’. I didn’t twig. I was 25. From thence on it has become worse and I am still an account holder after 53 years. I must be dumb or staipit as we say in Scotland…

      Rant over ‘ferra noo’.

    • alan jutson
      Posted October 15, 2012 at 4:57 pm | Permalink

      John

      Was this position ever advertised abroad ?

      Surely we should be seeking the best in the World, rather than ” in house candidates from a bankrupt system”

      Perhaps it would be far better to have a person who has been in a position as deputy from another Country, but which has a proven record of Prudence on financial matters if we cannot get the head honcho.

      Who is going to choose the candidate, those who have even less experience and knowledge in such matters.

      This seem like an absolute disaster waiting to happen.

      I know who will pay for all the mistakes as well, yes thats right, the good old taxpayer and those with savings.

      It makes you want to weep.

  3. lifelogic
    Posted October 15, 2012 at 6:12 am | Permalink

    Precisely, a catalogue of childish errors by the group “think” establishment, as you detail perfectly.
    The job description made clear they wanted an insider (someone proven wrong on the many issues you detail), and who would not rock the group think boat. As with John Major’s idiotic ERM, it is better to go over the cliff together than spoil the group think party by pointing out the dangers ahead. They do not even apologize afterwards.

    A similar catalogue of errors is being made over energy, the renewable religion and absurd exaggerations on warming.

    • lifelogic
      Posted October 15, 2012 at 7:32 am | Permalink

      If, as reported, the government has actually agreed to allow people of sixteen to vote in the referendum, it is surely another big mistake by Cameron. It is likely to spread and is not a good thing. Already so few voters actually are net tax payers anyway.

      As Winston Churchill said:

      “Show me a young Conservative and I’ll show you someone with no heart. Show me an old Liberal and I’ll show you someone with no brains.”

      The last thing we need, is more, non tax paying people, voting mainly on their irrational emotions and feelings to spend others money. Clearly in my case I did not have a heart anyway after about 11.

      I am reminded of the story, related on this site, of a young employee who was very annoyed about all the deductions were on his first pay packet. It was explained that this was to pay for defence, police, schools and the like – he answered “I thought the government paid for all that”. That is indeed the impression the government and the BBC try to give.

      Almost as big a mistake for Cameron, as the breaking of the Cast Iron Guarantee, allowing Nick Clegg equal billing on the TV debates or becoming another expensive energy fake green. With all his “hug a husky” and toy windmill on his house in none windy Notting Hill. It is just absurd drivel and gimmicks.

      • Jerry
        Posted October 15, 2012 at 9:22 am | Permalink

        Indeed lifelogic, what ever next, children being allowed the vote…oh hang on….

        I don’t mean to be patronising but people of 16 and 17 years old know nothing about the world and politics other than what they have been told, which is precisely why the SNP want such children to vote, these extra voters know nothing of life before devolution whilst their parents will know little or nothing of life before the 1980s second industrial revolution that. I hope I will be allowed to suggest that, if this voting age change goes unchallenged, it could become the biggest case of gerrymandering of modern history. 🙁

        On the more general point of voting age, if anything the age needs to be raised, medical research suggests that the human brain is not fully mature until between the age of 20 and 25 years old, so perhaps the age needs to be set back to 21. Also this suggestion that people who pay taxes should be allowed to vote is nonsense, tax isn’t just income-tax, and as such kids of five are subjected to tax via VAT when they spend their pocket-money so should they also have a vote?!

        • Mark W
          Posted October 16, 2012 at 2:42 pm | Permalink

          Tax and voting. I’m becoming of the thought that voting should be linked to direct tax. As it’s still direct tax payers that are providing the money that leftists bribe the electorate with.

          No Representation without Taxation.

          A first step would be to rename benefit as charity and income tax and NIC as compulsary charitable giving. It is what it is so why not allow those living on it to carry the shame of being charity cases.

          Germany gets quoted a lot, and has a more generous benefit system than us, but less recipients. I imagine that the culture they have is still to contribute not bleed the system.

          • lifelogic
            Posted October 17, 2012 at 3:38 pm | Permalink

            Good plan. The German culture will slowly change though if they continue with generous benefits.

      • wab
        Posted October 15, 2012 at 10:52 am | Permalink

        Well, other than the fact that you made up a Winston Churchill quotation (http://www.winstonchurchill.org/learn/speeches/quotations/quotes-falsely-attributed) there is the small point that a large fraction of the “takers” (from the public purse) are pensioners, many of whom vote Tory, so are they voting “irrationally”?

        (The fact that these pensioners were possibly net contributors in the past is irrelevant. Now they are “takers” and so according to your logic they have every incentive to vote for big spending government, especially when that spending is on them.)

        Whether 16 year olds should be allowed to vote is a separate matter. But hardly any 18 year olds vote and it’s hard to believe that many 16 year olds would vote either, which is one reason the running of the country is skewed towards old people rather than young people. The current generation of pensioners have never had it so good. The current generation of young people are being stuffed on all sides (university fees, crazy house prices, etc.)

        • lifelogic
          Posted October 15, 2012 at 3:23 pm | Permalink

          I did not make it up, but did only look it up quickly on the internet! Perhaps “socialist” would be a better word than “Liberal” as Liberal means different things to different people, and different again in the US.

        • lifelogic
          Posted October 15, 2012 at 3:37 pm | Permalink

          Current pensioners perhaps, but not those in the private sector on money purchase schemes who are about to retire, who have all been robbed by Brown. I agree it is hard for the current generation of young people, but university fees are only a loan and most of the low paid, especially woman (due to career breaks), will never repay it. So it is part grant in effect.

          High house prices are due to supply and demand and silly OTT “green” building regs. Reduce inward migration, build more houses and relax planning. Also reduce the size of the parasitic sector and get cheap energy so some real growth can happen.

          Even when I bought my first property back in about 1982, in London it was very, very hard indeed to fund it. I had to let the spare rooms work all waking hours for the first few years.

      • lifelogic
        Posted October 15, 2012 at 1:17 pm | Permalink

        Cameron talked, in relation to the Scottish referendum today of “having respect for the people of Scotland” and “you cannot hold the people against their will”.

        This as opposed to his total contempt for the people of England. They, of course, should also have a say in this “Scottish” matter. Also clearly a say in the EUSSR. Hypocrisy of the first order by Cameron. He is indeed holding the English against their will as he must know well. A biased question too, it seems and even 16 year old’s to vote on it.

        All his decisions see to be mad, pro EU, socialism to me.

        • Barry
          Posted October 15, 2012 at 6:35 pm | Permalink

          The Scottish independence referendum is a monstrous affront to democracy. The Scottish minority already enjoy additional democratic rights (the Scottish Parliament) that the majority of the UK does not share in any equivalent way. Ironically, Scottish independence would have the benefit of levelling democratic rights for the majority of UK citizens.
          The referendum lacks any measure of natural justice. It is rather like a question of divorce where only one party is considered. The majority of UK citizens should be asked if they wish to sever links with Scotland. As a so called Unionist, DC may rightly fear to ask the question. There may be a majority of the UK voting for Scottish independence. As a so called PM, DC has demonstrated a lack of courage to do the right thing. There should be a referendum for all the UK to take part in or no referendum. DC has blown it.

          Reply: I would not want a referendum on whether the UK leaves the EU to be decided by the whole EU!

          • Alan Wheatley
            Posted October 15, 2012 at 9:48 pm | Permalink

            While I agree that the Scots should be allowed to decide on whether or not they wish to remain in the UK, they most certainly must not be allowed to dictate the terms should they decide to leave. The terms are certainly something on which the people of England Wales and NI must have their say, and in that respect the situation is nothing like the EU.

          • lifelogic
            Posted October 16, 2012 at 3:45 pm | Permalink

            It is not the same as the EU. But will the Scots actually know the terms of separation when they vote?

          • sm
            Posted October 17, 2012 at 2:44 pm | Permalink

            Perhaps England & Wales should vote on leaving a Euro-Federalist UK?

            If the Scots vote to leave , why cant we help them by legally structuring it so only Scotland remains in the UK?

            At least then Scotland would have more options , control of their own currency using the old sterling and EU membership? The EU is unlikely to give them this option we possibly could?

            What would be the downsides for England?

      • nicol sinclair
        Posted October 15, 2012 at 1:25 pm | Permalink

        I think that Cameron wanted to ‘hug a hoodie’! Maybe also a huskie, but their teeth are sharper…

        • Electro-Kevin
          Posted October 15, 2012 at 6:06 pm | Permalink

          Nicol – Their breath smells foul too.

          Skunk cannabis is pretty pongy stuff.

        • lifelogic
          Posted October 15, 2012 at 7:09 pm | Permalink

          Oh well you know what I mean!

    • Leslie Singleton
      Posted October 15, 2012 at 11:46 am | Permalink

      BTW don’t forget Major’s fatuous decision to rename just about everything a university, which with the dumbing down also of just about everything has ruined an education system that used to be the gold standard. Apart from right and wrong, totally antithetical to anything remotely Conservative (which word it may be useful to point out comes from the word ‘conserve’).

      • lifelogic
        Posted October 15, 2012 at 3:42 pm | Permalink

        I particularly like the misleading claim they used to make of “when we came in to office only 10% went to University now it is 40% (or something similar). This was just a way of saying we have changed the name of all the colleges to Universities and making it sound like they had achieved something.

        What was needed was more technical and building colleges I suspect.

    • Bazman
      Posted October 15, 2012 at 5:13 pm | Permalink

      Easy hire and fire group “think” ?

      • APL
        Posted October 16, 2012 at 11:18 am | Permalink

        Bazman: “Easy hire and fire group “think” ?”

        Easy hire is a good thing, no?

        • lifelogic
          Posted October 16, 2012 at 3:47 pm | Permalink

          Indeed and good for the fired one too he can get another job more suitable.

          • Bazman
            Posted October 16, 2012 at 5:27 pm | Permalink

            What if he is fired from a good job for asking for something like a pay rise or better working conditions. Should he just get another job instead? Or even worse fired from the same job for racist/sexist reasons or the boss does not like him better for him then? He could just get another job huh? What if the shop ripped you off and then told you the buyer should be more aware? Not happy then are we?
            Silly simplistic reasoning.

          • APL
            Posted October 17, 2012 at 6:35 am | Permalink

            Bazman: ” a good job …. for asking for something like a pay rise or better working conditions.”

            One has to ask Bazman, what constitutes in your opinion ‘a good job’ if it doesn’t include good working conditions and reasonable pay – which the employee would have been fully cognizant of when he accepted the position?

            But I assert that it is highly unlikely that an employer will fire a ‘good employee’ just for asking for these things, the employer may refuse the request, but is unlikely to fire someone just for asking.

          • lifelogic
            Posted October 17, 2012 at 3:42 pm | Permalink

            Employers do not want to fire good reliable employees whatever their gender, colour or creed they are hard to find and expensive to replace.

          • Bazman
            Posted October 18, 2012 at 6:35 pm | Permalink

            Naive dream world opinions again. As mentioned by me before and without reply from either of you. How do you explain companies revolving door recruitment policies if good employees are so hard to find and like ‘gold’?

  4. David Jarman
    Posted October 15, 2012 at 6:24 am | Permalink

    By reading the above, it sounds like you don’t realise the system is rigged? Same reason you didn’t get the leadership of the party and never will. It’s all a closed shop and unless you are a criminal gang member you won’t get in. As people turn away from main stream propaganda, oops , media, people are slowly waking up and the when there’s enough awake the consequences of the backlash are going to be cataclysmic.

    • Gary
      Posted October 15, 2012 at 9:41 am | Permalink

      I see it differently fwiw.

      I think Mr Redwood understands this system very well. I think the situation has now become so precipitous that he is speaking truth to power and be damned. Many of us thought this should have been done a lot earlier, but perhaps we underestimate the fraught difficulties of doing this in an incestuous westminister pressure cooker ?

      • Winston Smith
        Posted October 15, 2012 at 2:34 pm | Permalink

        But JR is widely ignored by the media and certainly by the political elite. You understimate the will and the power of the political/media establishment to maintain, and even expand, the status-quo. EU sceptics like Hannan, Carswell, etc believe they can influence the Tories from within. Precisely, the opposite of their view of the EU. The only way to rock the political/media establishment is to stop voting for LibLabCon!

    • A different Simon
      Posted October 15, 2012 at 9:47 am | Permalink

      “Closed shop” is a perfect description .

      To stage a revolution we would need a revolutionary leader and they would have to come out of nowhere .

      Supposing sufficient people did wake up (a miracle)do you trust that the vote counting , collating and official media (BBC) that the reported results would reflect votes actually cast ?

      Personally I cannot see it . There is just so much vested interest and skin in the game .

      There are the rulers and the ruled and the ruled don’t have any power and will always lose .

      Elections are just a bit of theatre to make plebs think they can influence things when they cannot .

  5. Pete the Bike
    Posted October 15, 2012 at 6:27 am | Permalink

    The list of failure and disaster is surely an argument for not having a central bank. Before Britain had one it rose to be the most powerful empire in the world. Since we’ve had it we’ve sunk to a backwater with gigantic debts. If we must have it then repeal all legal tender laws and allow competing currencies to be issued and used, that would prevent the abuse of the pound by Merv and his successor.

    • Jerry
      Posted October 15, 2012 at 7:29 am | Permalink

      Pete, care to name one economically active modern country that doesn’t have a central bank?

      • APL
        Posted October 15, 2012 at 8:47 am | Permalink

        Jerry: “care to name one economically active modern country that doesn’t have a central bank?”

        Care to name one economically active modern country with its own central bank that isn’t mired over its own GDP with debt and other off balance sheet obligations?

        One might draw the conclusion that a central bank is a prerequisite for economic instability.

        • zorro
          Posted October 15, 2012 at 9:15 am | Permalink

          One of the supposed arguments for bringing in the Federal Reserve was to bring stability and dramatically lessen the risk of financial turmoil. Yet their interference in the US economy in the 1920s helped set of the economic circumstances which brought about the 1930’s recession. Since 1913, inflation has taken off and purchasing power and the value of savings have been radically reduced.

          zorro

        • Jerry
          Posted October 15, 2012 at 9:28 am | Permalink

          From the frying pan into the fire in other words “APL”.

          This is all a bit like the typical British summer, we all know that on average most of the time the sun shines but that doesn’t stop us from only remembering the rainy days…

          • APL
            Posted October 15, 2012 at 3:20 pm | Permalink

            Jerry: “From the frying pan into the fire … ”

            Not really Jerry.

            As ‘Pete the bike’ pointsd out, a central bank isn’t a prerequisite for a successful economy.

            But that aside, look at the record of Central banks over the last 100 years. Our currency has depreciated in value by 98% since the end of the first world war, to the extent that once upon a time you might live fairly comfortably on 10-/- a week. Wheras today 50p will almost buy you a chocolate bar.

            In the USA, the same story, the $US is also worth about 3% of it’s 1913 value.

            The point is, I think, a central bank whether it is claimed to be independent or not, cannot but do the bidding of its political masters. In the UK they used it to finance two world wars and numerous minor skirmishes over the years.

          • Jerry
            Posted October 16, 2012 at 3:51 am | Permalink

            APL: Inflation is not caused by central banks, it is caused by people like you and me wanting a better life and thus driving up costs etc, you forget that until WW1 most people either exploited others to make personal wealth or were content with what they had in life (deference was all powerful, people would stand aside whilst their betters had the pick of the situation), getting rid of a central bank will not get rid of inflation and it most certainly doesn’t prove that the grass will be any greener.

          • APL
            Posted October 16, 2012 at 8:27 am | Permalink

            Jerry: “Inflation is not caused by central banks, it is caused by people like you and me wanting a better life and thus driving up costs etc, ”

            Mostly I have tip toed around your comments, but here your error is so egregious that it cannot but be contradicted.

            The mandate of the Federal Reserve is ‘stable prices’, it has instead aimed for inflation of 2% a year. In so doing the Fed has acted outwith the law and its founding charter.

            Our government too, has claimed to aim for 2-3% per year inflation. This means that the value of £100 twenty five years ago will buy £50 worth of goods today. that is arithmetic not politics! Ask Rebecca Hanson.

            This has been our governments stated policy goal.

            By the way they have aimed for that range, inflation has exceeded more often than it has undershot 3%.

            Now, imagine what that rate of inflation does to your savings for your old age? In a life time, you are aiming to save sufficient to sustain yourself in your twilight years, yet the government has as its instrument of policy that over your lifetime your savings should decimated.

            Now, take for example the computer industry as a case in point where more people, like you and me, buy a thing. That means demand has gone up, but has the price of computers gone up? Absolutely not.

            Not only has the computer you might buy today, many more features and much higher performance than one you could have bought twenty years ago, it costs less than something similar would have twenty years ago.

            That is what mass production and consumer choice brings to the market, deflation, that is the true effect of ‘people like you and me’ wanting a better life that is, a gentle decrease over time in the price of a thing resulting from the pressures of competition in the market, the free application of human genius and not so much of the dead hand of the public sector.

            Jerry: “a central bank will not get rid of inflation”

            Of course not, inflation is a stated aim of Central banks.

            Jerry: “that the grass will be any greener.”

            No but in a world without a central government policy of inflation, the grass may well be cheaper!

          • APL
            Posted October 16, 2012 at 8:44 am | Permalink

            Jerry: “you forget that until WW1 most people either exploited others to make personal wealth or were content with what they had in life (deference was all powerful, people would stand aside whilst their betters had the pick of the situation),”

            No I do not forget. You will find that over the whole of human history that was by and large the case, the condition was not special to Britain, if anything conditions were better in the UK than in many other parts of the world, not excluding our European neighbours.

          • APL
            Posted October 16, 2012 at 11:55 am | Permalink

            APL: “This has been our governments stated policy goal .. ”

            Hidden in plain sight is the governments intent do destroy your net worth over your lifetime.

          • Jerry
            Posted October 16, 2012 at 8:20 pm | Permalink

            @APL: Oh yes, how silly of me, and no doubt it’s all sanctioned by that world government of five powerful people….

            That inflation rate you cite is the stated Maximum, if government so wanted inflation then why does the Gov. of the BoE have to write to the Chancellor to both explain and apologies for exceeding the target since 1997, and why did Mrs Thatcher spend her entire premiership attempting to get inflation down from the highs of the 1970s?!

          • APL
            Posted October 17, 2012 at 6:50 am | Permalink

            Jerry: “why does the Gov. of the BoE have to write to the Chancellor to both explain and apologies for exceeding the target since 1997,”

            It is a trivial matter of routine to write a letter when the interests of the Bank and the Government are served by the inflation rate exceeding the published limit. Further has a BoE governor ever been sanctioned, that is not recieved his bonus, or taken a pay cut or been fired, for missing the published inflation target? No? I thought not.

            By the way, it is a delicate balancing act, the government knows that inflation at a high rate will lead to civil unrest like for example in Egypt recently – which wasn’t a popular cry for democracy but a demand for affordable food. Anything above 10% inflation for a prolonged period will lead to economic and political instability. 2% inflation is a safe quantity, where the frog doesn’t realize the water is getting hotter.

            Anyway, you have not addressed my point that the reasonably sounding 2% inflation target wipes out half the value of your assets in half a lifetime.

            We could have gentle deflation in the economy, just from the actions of the mass market and capitalist economics, but instead the government prefers inflation, deflation would make its debts more expensive, inflation has the opposite effect.

            Coincidence that the government is the largest debtor and is well served by having it’s debt continiously halved in value.

            You can if you wish look for conspiracies, but I’ll stick with the available facts to draw my conclusions.

          • Jerry
            Posted October 17, 2012 at 9:21 am | Permalink

            @APL: “You can if you wish look for conspiracies

            If ever there was a pot trying to call the kettle…

          • APL
            Posted October 17, 2012 at 11:16 am | Permalink

            Jerry: “If ever there was a pot trying to call the kettle…”

            No, I have pointed out the mathematical certainty of published government inflation policy – 2% per annum inflation destroys the value of your assets by 50% in 35* years. Most people don’t start to accumulate assets until they are about thirty, so they don’t realize or don’t care what is going on.

            I have also pointed out the error in your assertion that it is the wish of ordinary people for a better life that causes inflation, giving you an example of the computer industry that supports my point.

            And finally, I will cite Milton Friedman, “Inflation is always and everywhere a monetary phenomenon in the sense that it is and can be produced only by a more rapid increase in the quantity of money than in output.”

            *My error in my earlier post where I said 25 years.

      • MickC
        Posted October 15, 2012 at 9:06 am | Permalink

        The fact that countries have a central bank is no evidence that they are necessary-just that they are fashionable.

        • lifelogic
          Posted October 15, 2012 at 3:45 pm | Permalink

          Fashionable, and the suit the powers that be lots of jobs for the boys.

    • Muddyman
      Posted October 15, 2012 at 1:31 pm | Permalink

      Restore to the Crown the power of issue and creation of money in all forms.
      Banks should only be allowed to lend monies they have earned or borrowed (their own or clients money) and should not be allowed to create money.
      This would be a start on the restoration of REAL money.

  6. Gary
    Posted October 15, 2012 at 6:31 am | Permalink

    I have one nagging doubt. What if they actually know what they are doing and they are overseeing a massive wealth transfer ? After, all it is not as if this fractional reserve banking lark is new stuff. They have had at least 300 years of practise, and probably more than 800 years.

  7. Paul Cadier
    Posted October 15, 2012 at 6:34 am | Permalink

    The usual suspects want to be rewarded for failure. If we want to revitalize our capitalism we need a new broom. There has to be clear blue water between where we are and where we want to be. The French call it “rupture”and without it we cannot advance. If the Tories are still the party of aspiration they must ditch corporate welfare, the socialization of private debt, reimpose the rule of law…for all citizens equally and punish corruption and failure
    .
    Turner is so “NewLabour”. The worst possible candidate. Ask Roubini instead.

    When you have done all of that people like me will open our wallets and dig this country out of economic depression.

    • Lord Blagger
      Posted October 15, 2012 at 8:08 am | Permalink

      Lets get Ron Paul or the equivalent in. Or Schiff. Lets clear the manure out of the stable.

      Lets get Turner to put his entire wealth on the line. If he doesn’t control inflation, then he is toast.

      The Chinese go one step further.

  8. APL
    Posted October 15, 2012 at 6:50 am | Permalink

    JR: ” and Lord Turner, ”

    The man who couldn’t regulate while head of the regulator, is now a candidate to show how inept a central banker he could be.

    An object lesson in how the Civil service rewards the incompetent.

    • lifelogic
      Posted October 15, 2012 at 8:36 am | Permalink

      Indeed that Lords, commons and state sector is full of people who have been proved wrong, time and again the endless Jonathon Porritt and Lord Patten types. Doubtless John Major, Blair, Brown, Clegg, Cameron to join them soon …..

      • Captain Crunch
        Posted October 15, 2012 at 1:11 pm | Permalink

        John Major stopped being Prime Minister 15 years ago. He could have gone up to the Lords any time he wanted but has chosen not to.

        • zorro
          Posted October 15, 2012 at 3:41 pm | Permalink

          Perhaps he had a tinge of guilt for inflicting his ‘Major Disasters’….

          zorro

          • lifelogic
            Posted October 16, 2012 at 3:16 am | Permalink

            I doubt it, he has never apologised nor even leant anything from them.

        • forthurst
          Posted October 15, 2012 at 5:53 pm | Permalink

          He preferred the cachet of Order of the Garter as he had the requisite number of O levels.

      • Bazman
        Posted October 15, 2012 at 5:14 pm | Permalink

        Being proved wrong has never changed your views.

        • Richard
          Posted October 15, 2012 at 9:45 pm | Permalink

          Being wrong is a matter of opinion Bazmanand depends on your viewpoint.
          You think you are always right and others like lifelogic have the opposite view
          Such is life.

          • lifelogic
            Posted October 16, 2012 at 3:49 pm | Permalink

            I seem win most of my financial bets of the markets so I must be doing something right – unlike Major and Osborne with his gifts to the PIGIS.

          • Bazman
            Posted October 16, 2012 at 5:30 pm | Permalink

            Like justice and human rights are relative depending on whom they are applied to? Maybe in your world and life logics claim of winning all his bets is non provable bullshit. Ram it.

    • Denis Cooper
      Posted October 15, 2012 at 9:22 am | Permalink

      Turner only became the head of the regulator in September 2008; obviously the head of the FSA during the preceding five years, Sir Callum McCarthy, couldn’t regulate, but I don’t think Turner can be blamed for that.

      • APL
        Posted October 15, 2012 at 3:27 pm | Permalink

        Denis Cooper: “Turner only became the head of the regulator in September 2008 .. ”

        Noted Denis and thanks for the correction.

        In any case I have heard more than enough Turner interviews to arrive at the judgement, the man is uniquely unqualified to head up the UK central bank.

      • Jerry
        Posted October 15, 2012 at 3:50 pm | Permalink

        That might be so Denis but Lord Tuner then went on to defend (publicly, on television) the actions of his predecessors actions and the policies of “light touch” regulation, making people ask if he would have done anything differently himself.

    • Leslie Singleton
      Posted October 15, 2012 at 11:52 am | Permalink

      APL– And worse, not just a central banker but the regulator as well–incredible to me that he should have the brass neck to apply.

    • Single Acts of Tyran
      Posted October 15, 2012 at 1:02 pm | Permalink

      I have to agree. The failure of the FSA is widely accepted.

      So the person who headed it up and oversaw the failure should get the top job in the B of E?

      Huh?

      • Denis Cooper
        Posted October 15, 2012 at 5:35 pm | Permalink

        But nobody is even suggesting that Sir Callum McCarthy should be the next Governor …

  9. Jerry
    Posted October 15, 2012 at 7:12 am | Permalink

    I suppose the question that needs to be asked is, just how independent are the BoE and the FSA, if they are to blame then neither of these two contenders should be allowed to be in charge of a piggy-bank never mind the countries central bank! On the other hand, I see an awful lot of government finger prints over that list of failures (both pre and post 1997) and of course it is often those who have assembled the mess who know how best to sort out the mess.

    Reply: The last Conservative government bought the ERM quackery advocated by the Bank with bad results. The last Labour government worked closely with the Bank on QE, bank nationalisation and all the rest that has caused the present problems.

  10. Caratacus
    Posted October 15, 2012 at 7:18 am | Permalink

    And I thought I was a cynical old curmudgeon!

    As many of the far more thoughtful observers above have noted, the establishment will indeed have its placeman so that the ‘redistribution’ of wealth can continue apace. That is, redistributed from the many to the few.

    There are times when I believe that even Don Corleone would have tipped his hat with respect at what these appalling people are being allowed to get away with.

    • lifelogic
      Posted October 15, 2012 at 8:37 am | Permalink

      Indeed if they make money from it they will find a good justification for it to continue.

  11. Lord Blagger
    Posted October 15, 2012 at 8:06 am | Permalink

    And Turner was instrumental in the cover up over state pensions, allowing the fraud to continue.

    e.g His review states pensions are affordable, but never quantified the present value of that debt.

    His only plan is to inflate the debt (ignorant or fraudulent that most of the debt is pensions and inflation linked).

    On the fixed debt the plan is to defraud the holders of that debt. After all, the remit was that inflation would be controlled, and people were induced to buy gilts on that basis. Not controlling inflation is then fraud.

    • lifelogic
      Posted October 15, 2012 at 8:38 am | Permalink

      Indeed he was.

  12. zorro
    Posted October 15, 2012 at 8:11 am | Permalink

    Another crunching tackle into the legs of the governing elite by JR……you have ver politely indicated how these ‘clever’ and ‘hard working’ men have consistently cocked up or failed to regulate some of the most crucial economic decisions of the last 15 years…….

    Now if they are clever, why do they consistently make decisions which weaken middle and working class people yet seemingly concentrate the wealth through various wealth stealing mechanisms into the hands of the global elite. That had been the practical effects of QE and ZIRP.

    Some of the more cynical amongst us might think from that list you mention that it might have been quite a useful road plan to achieve that aim…….

    zorro

    • zorro
      Posted October 15, 2012 at 8:12 am | Permalink

      Of course the title of the piece being ‘inside job’ shows the potential for this thinking…..

      zorro

  13. Sebastian Weetabix
    Posted October 15, 2012 at 8:18 am | Permalink

    Having presided over the first bank run in the UK for 140 years, how can the then head of the FSA even be a credible candidate? In a more unforgiving time he might have found himself dragged before the bar of the house. Either he was negligent or incompetent. Why does no one ever take responsibility for failures of administration or governance these days? It enrages me how these dead-beat box tickers drift from one lucrative emolument to another on a wave of perquisites, immune to being sacked or disciplined.

    • Denis Cooper
      Posted October 15, 2012 at 9:14 am | Permalink

      Except that Turner wasn’t the head of the FSA at that time; that was its first head Sir Callum McCarthy, see my longer comment below.

  14. Brian Tomkinson
    Posted October 15, 2012 at 8:26 am | Permalink

    I hope you didn’t let the wording of the advert put you off applying.

    Reply: I did not apply

    • Brian Tomkinson
      Posted October 15, 2012 at 8:41 am | Permalink

      I am sorry to read that.

      • outsider
        Posted October 15, 2012 at 12:24 pm | Permalink

        Dear Mr Redwood, That should not stop your being chosen for a personal appointment by Messrs Osborne and Cameron, given the paucity of “clean” or competent candidates that I have heard of.

        Even from a narrowly political point of view, it might suit them, LBJ style, to have you inside the tent and I suspect that many Labour MPs would privately approve.

        The post needs someone with their own mind, a positive programme and determination, not a mindless careerist.

        Of the two favourites you mention, Paul Tucker would be the least worst. Although he has blotted his copybook badly of late, he is at least a stronger character capable, in my view, of reaching his own conclusions and changing course.

  15. bj'sputer
    Posted October 15, 2012 at 8:34 am | Permalink

    I wonder how many others have noticed this in their areas: my local branch of RBS/Natwest has just been revamped so that there are now two teller positions (to replace three) and a fancy cash machine that takes in cash deposits. OK, the latter is a useful piece of tech’—no problems there. But these two teller positions and the machine are ALL that’s in there: there are no other staff in sight; no desks; so the human interface (sorry about the phrase) is gone. The place feels like the ticket office at Llandudno Junction station on a (wet) Sunday afternoon.

    Second point: very little of the building’s floor space is now actually used. If it’s anything like the Barclays branch up the street (where I have been inside beyond the public area) the first and second floors will be empty: at a guess, some 5%-10% is now utilised. Now, I realise that with computerisation the vast army of clerks and bookeepers who used to occupy the now empty space have long been made redundant and that does represent efficiency gains.

    But the question is, if so little of the space in bank branches is needed for the retail operations why are they keeping the buildings? Certainly in the case of RBS/Natwest, as taxpayer owned, how come they get to keep these extremely valuable properties when they clearly don’t need them for operations?

    If I had a £2m house and a £1.7m mortgage which required subsidy to service, wouldn’t the mortgage Co’ (who might well be RBS/Natwest) be telling me to sell the house?

    The status quo is not exactly sweating the asset, is it. And on top of that, as LifeLogic frequently points out, they aren’t doing much of the retail service to customers anyway. I’ve just had to go to a ‘bridging loan’ Co’ (at Credit Card rates) to get finance to build a granny flat pending the sale of my Ma’s property. The loan-to-value ratio on Ma’s place is 4 to 1 but both my bank (RBS/Natwest) and Ma’s (Lloyds) said simply “We don’t do that kind of loan any more.” thus becoming of even less use to the general economy.

    Our host is correct: RBS/Natwest should have been broken up and sold off once they’d lost their shirts. In my view they will not survive for long in their present form anyway.

    • oldtimer
      Posted October 15, 2012 at 10:22 am | Permalink

      re Underused bank buildings on the High St, their problem is, in all likelihood, an absence of buyers or potential users for the spare space. As discussed here previously, the High St is dying. Technology, and the spread of on-line banking, has made old methods, and the space needed to support them, entirely obsolete. It is a fact of life in all industries. Banking is no different.

    • nicol sinclair
      Posted October 15, 2012 at 2:11 pm | Permalink

      @bj’sputer: “If I had a £2m house and a £1.7m mortgage which required subsidy to service, wouldn’t the mortgage Co’ (who might well be RBS/Natwest) be telling me to sell the house?”

      Been there, but not with £2 million house, and RBS/NatWest wanted to foreclose although I have never, ever defaulted. They just want their money back and sod the home owner. I have desisted by threatening (and it was not a hollow threat) to take them to the cleaners – the Ombudsman. So far, I have succeeded – but for how long? Perhaps I shall lose my abode? Family on the street. Welfare? More expense to GoUK?

    • The PrangWizard
      Posted October 15, 2012 at 3:53 pm | Permalink

      I worked for NatWest in the 1980’s and ’90’s in the property department and would love to bore you all with a lengthy description with what I was faced with over exactly this sort of thing, but I won’t! The problem is not new. I’ve been retired 17 years and I’m well away from it now.
      It was a good job though and I enjoyed it; this was before NatWest was wrecked by RBS after the takeover. Sold out by the spivs in the City who were installed around that time, – was it the ‘big bang’ a few years before? Scotland’s RBS was the villain. And now NatWest is broke thanks to it. Separate the two organisations when you think about them.
      “Why do they keep the buildings?” Surely it can be understood from a purely property perspective they would probably want to close altogether and sell but they did the work to maintain a presence for the sake of customers, which no doubt include shops which need somewhere to bank their cash.
      And making use of the upper floors will show no return and thus be a waste of money.
      I wouldn’t like to work there now. The dash for easy money over the last 20 years has been a disaster, and everyone who borrowed to much, and knew they were doing so, is to blame. And no, I didn’t.
      It’s good to get a chance to let off steam.

  16. MickC
    Posted October 15, 2012 at 9:08 am | Permalink

    Turner will get it-because he is the best example of the phenomenon of “upward failure”, which is much prized among our rulers.

  17. Denis Cooper
    Posted October 15, 2012 at 9:09 am | Permalink

    In the interests of fairness it should be pointed out that the Bank of England and its Governor Mervyn King did not have responsibility for the prudential supervision of commercial banks, Gordon Brown having got Parliament to pass a law transferring that responsibility to the FSA, probably at the behest of the EU – as I recall it was reported ca 1998 that the Governor, Eddie George, had threatened to resign over that proposal, and maybe it’s a pity he didn’t follow through with that threat – and that Adair Turner only became the Chairman of the FSA in September 2008 and should not be blamed for the mistakes of its first Chairman Sir Callum McCarthy:

    ttp://en.wikipedia.org/wiki/Callum_McCarthy

    It was Sir Callum McCarthy who presided over a bunch of novices and incompetents at the FSA, but once the crisis had hit he was allowed to slink away from the scene of devastation, and was even given a job as a non-executive board member of the Treasury.

    Before the editorial staff of the Daily Telegraph decided that the boring plump owlish man with a funny name, Mervyn King, was totally responsible for everything that went wrong, they actually ran an interview with Sir Callum McCarthy, here in July 2011:

    http://www.telegraph.co.uk/finance/financetopics/profiles/8614299/Beekeeper-Sir-Callum-McCarthy-looks-for-a-new-source-of-honey.html

    “Beekeeper Sir Callum McCarthy looks for a new source of honey”

    “Former FSA chairman aims to profit from shaking up the housing market.”

    And even then he was still trying to evade any blame.

    Eventually one Telegraph journalist, Liam Halligan, stepped out of line and explained the real reason why there was an orchestrated vendetta against Mervyn King:

    http://www.telegraph.co.uk/finance/comment/liamhalligan/9248115/Bankers-vitriol-has-masked-Sir-Mervyn-Kings-uncomfortable-message.html#dsq-comments

    “It needs to be clearly and widely understood, though, that the City is trying to destroy King’s reputation for the simple reason that he is pretty much the only senior UK policy-maker still arguing for the kind of robust bank regulations, much tougher than those currently proposed, that are needed to prevent another serious financial meltdown.

    The negative-publicity campaign against King, years in the making but seriously escalated last week, is being staged by the same “vested interests” which he, almost alone among Western central bankers, has dared to face-down. As such, the investment banks drip their poison, the PR agencies punt it and knocking-copy sells papers – not least when times are tough.”

    Reply You can also argue that regulation gave us the wrong answers in 2008-9 as well as in the run up the crisis. You also need to consider these people’s judgements on the ERM, the Euro, QE and bank nationalisation.

    • Jerry
      Posted October 15, 2012 at 4:06 pm | Permalink

      Re Reply: Even if the post 2008 period isn’t in question one has to ask why someone with sound judgement would then defend the very regulation that went before and caused the problems, as (pointed out way up to another comment by Mr D Cooper) Lord tuner did on 15 February 2009 whilst being interviewed by Andrew Marr on BBC1.

    • outsider
      Posted October 15, 2012 at 5:32 pm | Permalink

      Dear Mr Cooper, You are right about Callum McCarthy. He has the rare distinction as a regulator for presiding over widespread failures in two seemingly secure industries, having somehow contrived to get almost half of the electricity generating industry to fail before turning his hand to banks.

      Lord Turner still managed to make things a lot worse. He officially (doubtless on instructions) told Lloyds Bank shareholders that they would be in a much worse mess if they did not agree to buy HBOS, thus needlessly creating a much bigger passenger to be bailed out. He then cracked down on bank reserves and lending policies at the bottom of the cycle, thereby creating (or at least multiplying ) the borrowing problems so often alluded to be Mr Lifelogic and helping QE to fail. He too has much to answer for.

  18. Acorn
    Posted October 15, 2012 at 9:13 am | Permalink

    What about the Aussie RBA Governor Glenn Stevens, he will be available next summer. You can still get some interest on an Aussie account, and their economy is pulling out of the crash better than ours with a 3+ % base rate. He appears to be rated as a Dove, rather than a Hawk or an Owl.

  19. Denis Cooper
    Posted October 15, 2012 at 9:35 am | Permalink

    I’m sometimes reminded of the scene in Julius Caesar when the mob catches and kills Cinna the poet; he tries to explain that he’s not Cinna the conspirator, he’s a different person, Cinna the poet; but they kill him anyway.

  20. Steve Cox
    Posted October 15, 2012 at 9:57 am | Permalink

    Adair Turner would be a total disaster. The length and depth of the British crisis since 2008 has largely been due to the arrogance of one self-serving Scotsman. The last thing we need is another arrogant, self-serving Scotsman running the central bank and regulating all of our commercial financial institutions. Therein lies the road to British purgatory.

    • nicol sinclair
      Posted October 15, 2012 at 1:33 pm | Permalink

      Hear, hear. See my comment below on the ‘Shred’

  21. A different Simon
    Posted October 15, 2012 at 9:59 am | Permalink

    It’s clear that the decision has already been made and it’s Paul Tucker .

    The mention of Turner’s name serves two purposes :-
    – a charade designed to add flesh to the pretense that they are actual going through a competitive recruitment process
    – make Paul Tucker look more acceptable .

    Turner is kind of like putting in a dummy planning application for a pig farm – makes the sewage farm application more palatable .

    • nicol sinclair
      Posted October 15, 2012 at 2:12 pm | Permalink

      See my comment below.

  22. Neil Craig
    Posted October 15, 2012 at 10:01 am | Permalink

    Technically the resume means they could headhunt somebody from Singapore’s central bank. Looking at that country’s success in finance as in other things, they should but I assume they won’t.

    • GJ Wyatt
      Posted October 15, 2012 at 2:16 pm | Permalink

      The magazine Global Finance rated the six best central bankers in 2012, (based on inflation control, economic growth goals, currency stability and interest rate management) as:
      Glenn Stevens, Australia
      Mark Carney, Canada
      Stanley Fischer, Israel
      Zeti Akhtar Aziz, Malaysia
      Amando Tetangco Jr., Philippines
      Fai-Nan Perng, Taiwan
      They were all given ‘A’ ratings. No European was given better than ‘B’. Mervyn King received a ‘B-‘.
      Stevens and Carney have been considered according to press reports. But why would they resign and go to the BoE? Their predecessors or deputies however could be credible candidates. Indeed Ian Macfarlane of Australia who did a brilliant job for 10 years (7 ‘A’ grades!) would be ideal. Moreover, no historical baggage in Whitehall or Threadneedle Street.

      • outsider
        Posted October 15, 2012 at 5:14 pm | Permalink

        Glenn Stevens’ term of office ends in September 2013, just three months after Sir Mervyn’s. and he is about the right age, so he might be persuaded.

        • Neil Craig
          Posted October 18, 2012 at 10:38 am | Permalink

          Fine suggestions. Too often our elite choose only to compare ourselves with other EU countries.But who can argue that an Australian isn’t compatible with our system? Such a person fits John’s requirement of being able to work with politicians but, unlike Mervyn King is clearly in a position to stand up to political demands.

          It would undoubtedly also enhance the £s credibility in international markets.

  23. A different Simon
    Posted October 15, 2012 at 10:01 am | Permalink

    John ,

    In the list of policies imposed upon us by the establishment you have missed off unabated mass immigration .

  24. Denis Cooper
    Posted October 15, 2012 at 10:22 am | Permalink

    Apparently Adair Turner has backed away from the idea of simply cancelling the gilts held by the Bank of England’s Asset Purchase Facility, APF:

    http://uk.reuters.com/article/2012/10/13/britain-fsa-turner-idUKL5E8LD2QA20121013?feedType=RSS&feedName=rbssFinancialServicesAndRealEstateNews

    “As for the specific idea of cancelling gilts or permanent monetisation, I have to say that was reported by my good friend (BBC reporter) Robert Peston, but that was Robert’s idea, not my idea”

    Gavyn Davies discusses what I would describe as the moral hazard for states which indulged in such practices:

    http://blogs.ft.com/gavyndavies/2012/10/14/will-central-banks-cancel-government-debt/#axzz29MK0HZ00

    “Outside of wartime, developed economies have not been normally been willing to contemplate any such actions. The potential inflationary consequences, which are in fact signalled by the elimination of central bank capital which this strategy involves, have always been considered too dangerous to unleash.

    For me, that remains the case. But others are more worried about deflation than inflation. This genie might soon be leaving the bottle.”

    For the Bank of England, “the elimination of central bank capital” meaning that if it happened tomorrow the APF would be unable to repay the ca £366 billion that the Bank has lent it to buy the gilts, and the Bank would then be left with about £400 billion of liabilities:

    http://www.bankofengland.co.uk/markets/PublishingImages/images/balance_sheet_liabilities.JPG

    but only about £20 billion of assets, plus whatever small cash float there may be in the APF:

    http://www.bankofengland.co.uk/markets/PublishingImages/images/balance_sheet_assets.JPG

    But while he writes:

    “The loser, however, would be the central bank itself, which would instantly wipe out its capital base if such a course were followed.”

    he adds:

    “The crucial question is whether this matters and, if so, how.”

    • Winston Smith
      Posted October 15, 2012 at 2:41 pm | Permalink

      “my good friend (BBC reporter) Robert Peston”

      Reference my regular comments on the political/media elite.

      • Denis Cooper
        Posted October 16, 2012 at 7:26 am | Permalink

        Exactly.

    • outsider
      Posted October 15, 2012 at 5:18 pm | Permalink

      Those Establishment worthies now arguing sagely against cancellation appear to be those who want QE to continue or at least keep their options open. Since cancellation, to be credible, would rule out further QE, that is not terribly surprising.

      • Denis Cooper
        Posted October 16, 2012 at 7:36 am | Permalink

        I don’t think cancellation would rule out more QE; rather the opposite, it could open the door to more QE with immediate cancellation of the gilts as soon as they were purchased without the worry about what to do with them later.

        If the present holdings of the APF were simply cancelled then that Rubicon would have been crossed; as Gavyn Davies says:

        “The loser, however, would be the central bank itself, which would instantly wipe out its capital base if such a course were followed.”

        and the answer to his question:

        “The crucial question is whether this matters and, if so, how.”

        would be:

        “No, it doesn’t matter at all that the Bank of England now has negative net assets to the tune of more than £300 billion, and that could just as well be made £500 billion or £5000 billion.”

        • outsider
          Posted October 16, 2012 at 5:45 pm | Permalink

          Dear Mr Cooper,
          I thought we had established that the Gilts are not even held on the Bank’s balance sheet, that all profits and losses are down to the Treasury and that almost all was financed by created money that would also be cancelled. Indeed, you wrote a detailed comment yourself making these points. Gavyn Davies appears to be wrong.

          • Denis Cooper
            Posted October 17, 2012 at 10:33 am | Permalink

            You correctly pointed out the complication that because the gilts are not owned directly by the Bank itself, but by its wholly owned subsidiary the APF, they do not appear on the Bank’s balance sheet.

            So while a statement such as:

            “The Bank now owns gilts valued at £366 billion”

            is true in effect it is not strictly accurate in accounting terms; it should instead read “The Bank’s APF … “.

            What appears on the Bank’s balance sheet as assets are its loans to the APF to buy the gilts, and clearly if the gilts were just cancelled then the APF would unable to repay the Bank and most of those assets on the Bank’s balance sheet would evaporate.

            However the corresponding liability on the Bank’s balance sheet, the new money created to lend to the APF so that it could buy the gilts, could not be cancelled by any feasible or ethical action by any arm of the UK state because it has been put into circulation and is out of the hands of the state.

            Even if the new money had literally been printed, rather than being in electronic form, can you imagine what would happen if the Bank suddenly announced that all its banknotes with certain serial numbers, to the tune of £366 billion, were now invalid?

            The new money which is in circulation cannot be cancelled, it can only be gradually recovered, primarily through taxation, and so Gavyn Davies must be right to say that cancellation of the gilts would wipe out the capital base of the Bank.

          • Denis Cooper
            Posted October 17, 2012 at 1:14 pm | Permalink

            The Annual Report 2011/12 for the Bank of England Asset Purchase Facility Fund Limited is here:

            http://www.bankofengland.co.uk/publications/Documents/other/markets/apf/boeapfannualreport1207.pdf

            On February 29th 2012 the Fund owed £287 billion to the Bank of England for the loan to enable it to buy assets, which loan is a liability for the Fund but an asset for the Bank, while the Fund owned gilts worth £308 billion and had £21 billion of cash on deposit with the Bank, which together comes to £329 billion of assets.

            Leaving aside smaller items, £329 billion of assets minus the £287 billion owed to the Bank = £42 billion surplus assets; but any profit made by the Fund is owed to the Treasury under the indemnity, and so there is a balancing item of £41 billion recorded as a liability in that respect.

            Now cancel the £308 billion of gilts and the assets of the Fund are cut to the £21 billion cash float, more or less; but the £287 billion loan owed to the Bank is unchanged, and so now that plus £41 billion becomes minus about £267 billion, meaning that either the Treasury stumps up about £267 billion to the Fund under the indemnity, or the Fund cannot repay the Bank the £287 billion loan, and the Bank is then well and truly bust.

          • Denis Cooper
            Posted October 17, 2012 at 7:56 pm | Permalink

            First reply missed for moderation.

  25. StrongholdBarricades
    Posted October 15, 2012 at 10:27 am | Permalink

    So how was Lord Turner allowed to resign?

    Why wasn’t he sacked and his honours removed?

    The BoE would be a laughing stock across the world if this man took over as head.

    • Denis Cooper
      Posted October 15, 2012 at 5:29 pm | Permalink

      How was Lord Turner allowed to resign from what?

      It was his predecessor as the head of the FSA, Sir Callum McCarthy, who was allowed to resign and slink off into the background in September 2008:

      http://en.wikipedia.org/wiki/Callum_McCarthy

  26. Johnny Norfolk
    Posted October 15, 2012 at 10:32 am | Permalink

    If Turner is appointed it will just show how it is rigged. He has faild in everything he does. We need new thinking and someone who will put the very basics right.

    • Barry
      Posted October 15, 2012 at 1:16 pm | Permalink

      At least you know where you are with Turner. He goes on in the same old way and fails in the same old way.

    • lifelogic
      Posted October 15, 2012 at 4:10 pm | Permalink

      Well Cameron appointed Lord Patten to the BBC so Lord Turner would seem to be the man he will go for. From Wiki: Jonathan Adair Turner, Baron Turner of Ecchinswell is a British businessman, academic and chairman of both the Financial Services Authority and the Committee on Climate Change. He was formerly chairman of the Pensions Commission. He has described himself in a BBC HARDtalk interview with Stephen Sackur as a ‘technocrat’.

      Says it all really, History and Economics at Caius, Cambridge I see. I am surprised he is not on a committee to ensure that the tides do not come in and out every day as well.

  27. Terry
    Posted October 15, 2012 at 10:53 am | Permalink

    Well John, I think you have just made the case for abolishing the Central Bank.

    You’ve had rather a lot of experience in International Banking, haven’t you? So, are you up for the job? I think that you would make a splendid Governor and steer the Bank of England on a true course to save the country and its finances. How about it?

    It’s a travesty that such appointments are made outside of electoral decisions. Why is this, I wonder?

    • scottspeig
      Posted October 15, 2012 at 12:02 pm | Permalink

      My first thought at reading this was “why did Redwood not stand?” – Should have shot to the favourite position surely!?!

      Reply: I don’t think that would have happened!

  28. Guy de Moubray
    Posted October 15, 2012 at 11:12 am | Permalink

    I haven’t commented for ages, but feel qualified to do so on this topic. I am now 87 ears old and in the mid-60s was chief economist at the Bank of England – the only sound money one ever, I think. Lord Turner has never said anything sensible – not even when he was Chairman of the CBI. I haven’t heard any sense from anybody in the Bank of England for the last ten years except from the current Chief Economist Spencer Dale on QE and inflation, who wasn’t even born when I last held his job! He must be finding life extraordinarily difficult under Mervyn King, who was one of the 364 stupid economists who signed a letter to the Times in 1981 saying that the Howe/Thatcher budget would ruin the economy. Push Spencer Dale

    • Manof Kent
      Posted October 15, 2012 at 1:14 pm | Permalink

      What an excellent comment!
      Are you up for the job?

    • Richard1
      Posted October 15, 2012 at 2:13 pm | Permalink

      Excellent post. Please allow your name to go forward, you are quite young enough – approx the same age as Paul volker who is still active. Sue them for ageism if you arn’t considered.

      Reply: I did not apply

      • Jerry
        Posted October 15, 2012 at 4:24 pm | Permalink

        Re Reply: John, I think the comment by Richard1, to which you replied, was actually being directed to “Guy de Moubray”, just for future clarity.

      • Richard1
        Posted October 15, 2012 at 6:21 pm | Permalink

        My comment was addresed to mr de moubray above, I’m well aware you, Mr Redwood, are some decades younger than Paul volker!

    • nicol sinclair
      Posted October 15, 2012 at 2:15 pm | Permalink

      Hear hear!

    • APL
      Posted October 15, 2012 at 6:49 pm | Permalink

      Guy de Moubray: “I think. Lord Turner has never said anything sensible – not even when he was Chairman of the CBI.”

      That is my impression also.

  29. GJ Wyatt
    Posted October 15, 2012 at 11:26 am | Permalink

    I note that John Vickers has now overtaken Adair Turner in the betting markets – and without any public statements from him, unlike Lord Turner who said last week that further new monetary stimulus measures may need to be taken. Commentators took this to mean direct purchases of new government debt. Well! He seems to have revealed himself ignorant of inflation theory and economic history, even though he may be, as you say, “clever and hard working”.

    • outsider
      Posted October 15, 2012 at 12:35 pm | Permalink

      Oh dear. Anyone who heads an “independent” government inquiry designed to reach conclusions pre-ordained by the Civil Service, such as Lord Turner, Sir John Vickers or Sir Howard Davies is almost by definition a careerist looking for advancement or an honour. By the same token, they will be pushed forward by Treasury Civil Servants as “sound men”.

      • outsider
        Posted October 15, 2012 at 12:51 pm | Permalink

        PS: As an example, I happened to come across Howard Davies in several of his many roles. A pleasant, highly intelligent and likeable man but I never discovered his personal view on anything.

        • Jerry
          Posted October 15, 2012 at 4:30 pm | Permalink

          @outsider: Does his personal views matter, surely it is his professional views that are all important, of course if you yourself are one of those who can’t separate their personal and professional life/views (many can’t) then you will not understand what I’m whitening on about…

          • outsider
            Posted October 15, 2012 at 9:31 pm | Permalink

            Dear Jerry, You actually make the point very well, even though that was not quite what I meant.

            The job of a top public/civil servant, as I understand it, is to advise his policy-leading minister how best to fulfil his/her objectives, evaluate and explain the difficulties in the way and then deliver the minister’s brief. Similar if you are Director General at the CBI.

            The Governor of the Bank of England needs to have his/her own vision, programme and objectives, take the initiative and get his staff to advise and deliver.

            Completely different. Of course you work within parameters, but so does the PM or the Chancellor.

      • GJ Wyatt
        Posted October 15, 2012 at 3:42 pm | Permalink

        Vickers shouldn’t be put in the same category as Turner. His inquiry into the banks was critical of government. A fine economist, albeit thin on macro, warden of All Souls, earlier Drummond Professor of Political Economy at Oxford, he is certainly a top academic. But he is a “known unknown” for the governorship, whereas Turner is all too much of a “known known”.

  30. nicol sinclair
    Posted October 15, 2012 at 12:45 pm | Permalink

    Dear Mr Redwood,

    I have just posted the following on the Devex International Development site. It might be appropriate to direct the comment at UK Government:

    “Or the ToR are deliberately drafted with a specific person(s) in mind or the project is advertised simply to tick the box that requires competition when there is never going to be any. For the latter, some of the International donor organisations are the guilty ones…”

    If this sort of comment has already been made, then I apologise in advance.

  31. Rebecca Hanson
    Posted October 15, 2012 at 12:52 pm | Permalink

    When Mervyn King first announced his resignation I heard him interviewed on Radio 4. The interviewer asked what advice he would give to a potential candidate.

    His answer focused on how when he’d taken on the job he had not had a good knowledge of the history of economic and monetary policy. He felt that had definitely been a fault which he had worked hard to rectify but recommended that a potential candidate spend the time until the appointment process ensuring they addressed this area of knowledge.

    Hopefully all the candidates have taken this advice.

  32. Bert Young
    Posted October 15, 2012 at 1:11 pm | Permalink

    Sir John Vickers has to be in the frame for serious consideration ; he has all the required skills and ingredients for the job and his work on the relatively recent report means he is up to date . Both Tucker and Turner are flawed starters and do not warrant further interest . The advertisement was the wrong approach to attract the right candidates ; once the specification had been agreed the targets should have been approached privately .

  33. Barry
    Posted October 15, 2012 at 1:13 pm | Permalink

    Sadly, ignoring past failures with cronies gaining top positions is not restricted to banking. There are plenty of amazing highly questionable CEO appointments in industry particularly in the US and UK. Politics follows the trend…just consider the two EDs appointments. Banks are just going with the swim.

  34. Barbara Stevens
    Posted October 15, 2012 at 1:19 pm | Permalink

    It appears, to a lay person, like myself there are serious misgivings about the quality of these men as far as running the Bank of England. Haven’t we seen enough bumbling to engage a person who may or not have the caperblity to host the post of G of the B of England. It should be on the caperblity and sound financial background of the person who succeeds and nothing else. The old school tie approach should be abandoned, and the choice made on merits for the job on caperblity and education, not whom you know.
    We do have talented people to do the job and it should be an Englishman who does it. I question the security of having foreigners in the Bank of England, there seems an awful lot happening within it that one does question. Perhaps my perception is wrong, after all I admit I’m a lay person in financial terms, what I do understand and know is, I’m worse off because of the collapse of the banking systems, and cannot see my fortunes getting better and I had no hand in the problem.

  35. Pincher Martin
    Posted October 15, 2012 at 1:27 pm | Permalink

    The new Bank of England Governor needs to be someone who knows about banking. He needs to be untainted by the Libor scandal and the securitisation of dodgy debt

    Adair Turner is a failed regulator whose only talent is self-PR.

    University lecturers, failed politicians and eternal students need not apply!

  36. Lindsay McDougall
    Posted October 15, 2012 at 1:41 pm | Permalink

    You may not have anything personally against the two front runners but I most certainly do. Lord Turner was in favour of our joining the Euro, and presided over the FSA when the so called “independent financial advisors” licenced by the FSA were recommending the purchase of annuities, which are dreadful value for money. The FSA don’t even object to such advisors receiving commission from the insurance companies selling the annuities. That’s corrupt practice. The number of retirees rebelling against the annuity option is now a million strong – and growing rapidly.

    As for Paul Tucker, he has been at the heart of the BoE establishment that made all the bad decisions listed by Mr Redwood. He also tried to throw Bob Diamond to the lions to save his own skin.

    So let’s have an outsider; I suggest Liam Halligan, the high priest of deficit reduction and sound money.

    This is as good a place as any to request an end to the practice of forcing people to buy an annuity on reaching age 75. I think that the government can ensure that.

  37. Richard1
    Posted October 15, 2012 at 2:20 pm | Permalink

    I think the problem is the conservative leadership don’t have much confidence in their own knowledge on many of these issues. They were like rabbits caught in the headlights in 08 during the disastrous Brown bank bailout. Had they called the crisis and the debt build up correctly the last election would have been won properly. Certainly lord turner should be ruled out due to his vociferous support for the euro and because of his latest inflationary suggestion that QE should be made permanent. The very few MPs, such as yourself, who really have a grasp of these issues have a duty to speak out strongly in the Nation’s interest.

  38. oldtimer
    Posted October 15, 2012 at 3:18 pm | Permalink

    OT or at best at a tangent to it.
    Spiegel Online has a revealing, and apparently well-informed, article on the UK and Europe and Germany`s changing attitude to UK membership. It can be found here:
    http://www.spiegel.de/international/europe/new-path-in-london-leads-away-from-european-union-a-861294.html

    Whoever is appointed the next Governor will have to navigate some very stormy waters.

  39. Vanessa
    Posted October 15, 2012 at 4:12 pm | Permalink

    The trouble is whoever gets this job will be tarnished with the past corruption and mistakes. We cannot trust anybody now in a position of “power” because there is, virtually no human being who is not corruptible and out for himself.

    Look at our celebritiy culture – we now see all of them come crashing down in reality. Drugs, paedophilia, under-age sex, rape – you name it they have all done it and got away with it. I hope this is the end of worship of people in the public domain just because they are famous and well-known – politicians and bankers watch out !!! It is OUR money you are spending.

  40. uanime5
    Posted October 15, 2012 at 4:17 pm | Permalink

    I wouldn’t blame them for the downfall of Northern Rock. Northern Rock failed because they made almost all their money by turning 120% mortgages into asset based securities and selling these assets to other companies. When people started defaulting on their mortgages, causing these the assets to become more risky, the market for these assets ended overnight and destroyed Northern Rock’s business model. Unless they’d recommended buying these assets that had a high risk of becoming worthless there was little that could have been done to save Northern Rock other than bailing it out.

    In other news MP’s pay may be increased by a third to £90,000 per year. It seems austerity only applies to other people.
    http://www.telegraph.co.uk/news/politics/9609760/MPs-pay-could-jump-to-90000-a-year-after-Ipsa-review.html

    David Blanchflower also points out that of the million private sector jobs the Government is supposed to have created about 200,000 were created by reclassifying public sector jobs as private sector ones:
    http://www.independent.co.uk/news/business/comment/david-blanchflower/david-blanchflower-job-creation-the-numbers-dont-add-up-8211004.html

    • outsider
      Posted October 15, 2012 at 9:38 pm | Permalink

      Sorry, uanime5, but that simply is not the story of Northern Rock, reprehensible though that was. What is your evidence, as someone so often says? Your story describes what happened to some US banks but Northern Rock was sunk by relying on miffy wholesale deposits, including from the US.

  41. Michael Cawood
    Posted October 15, 2012 at 5:45 pm | Permalink

    Whoever becomes he new Governor of the Bank of England must make sure that the biggest mistake of the incumbent is put right – there must be no more Quantitative Easing and this practice needs to be prohibited by law. When Margaret Thatcher and John Major were Prime Ministers they often spoke of the evil of inflation yet under this government and the last this odious practice has blossomed.

    • Denis Cooper
      Posted October 16, 2012 at 8:08 am | Permalink

      I believe that Darling and Osborne have acted unlawfully by authorising QE.

      I don’t expect either of them to openly admit that, any more than I expect them to openly admit that Darling entered into an illegal agreement in May 2010 when he went along with the decision to bail out Greece.

      Nor do I expect that there’ll be an Act of Parliament to retrospectively legitimise what they’ve been doing, even though that would be the correct course.

      However I don’t think it unreasonable to suggest that MPs should start to insist that if the Chancellor wishes to continue with his interventions in monetary policy then he should first invoke Section 19 of the Bank of England Act 1998 and ask Parliament to agree to the temporary suspension of the independence of the Bank of England with respect to monetary policy.

      http://www.legislation.gov.uk/ukpga/1998/11/section/19

      Nor is it unreasonable to suggest that MPs should furthermore insist that the Chancellor must not authorise any additional tranche of QE, and therefore any addition to the contingent liabilities assumed by the Treasury with respect to the indemnity against losses which has been given to the Bank, without first asking for and receiving their authorisation through a vote on a motion.

      Reply: The truth is Parliament by a large majority would have backed Darling and Osborne in any v ote on this, and could have had a vote on it. The only insititution to have a legitimate concern about the Bank needing to consult the Chancellor re QE is the Bank, and they were clearly happy with the agreed approach of ultimate responsibility resting with the Chancellor.

      • Denis Cooper
        Posted October 16, 2012 at 6:05 pm | Permalink

        Yes, but in 1998 Parliament went through the full multi-stage process of passing a much-vaunted Act which says in its Section 10:

        “In section 4(1) of the Bank of England Act 1946 (power of the Treasury to give directions to the Bank), at the end there is inserted “ , except in relation to monetary policy ” “,

        supposedly giving the Bank independence on monetary policy, and that is still the law and it should not be broken even with the tacit consent of the Bank and of MPs.

        Section 19 on the Treasury’s reserve powers provides a route for the Bank’s independence to be legally suspended rather than illegally ignored.

        Reply: I do not see what harm is done by the Bank seeking the Chancellor’s agreement.

  42. JimF
    Posted October 15, 2012 at 6:15 pm | Permalink

    I’d still argue for a scientist being appointed to this job in preference to an economist. Understanding that systems tend towards an equilibrium seems to be at the heart of this job, and somebody who realised that pumping more and more air into a balloon doesn’t actually expand the universe would be welcomed.

    Aside from that, all the time we are worrying about our relationship with the EU those conniving Swiss are planning separate free trade agreements with Hong Kong and China:

    http://www.swissinfo.ch/eng/business/Swiss_establish_Hong_Kong_business_hub_.html?cid=33733666

    How can they do this?
    Didn’t anyone tell them they were supposed to be isolated outside the EU?

  43. Steven Whitfield
    Posted October 15, 2012 at 6:23 pm | Permalink

    Doctor Redwood should be the next governor of the BOE.

    Mr Redwood, why do this breed of ‘clever and hard working men’, make such terrible decisions that cause so much pain ?. Are they misguided or is there some kind of underlying marxist plot to damage the Uk economy by stealth ?. It seems like an absurd notion ..but so is an institution supposedly full of economically illiterate people making completely the wrong decisions that defy all reason and logic…

  44. Jon
    Posted October 15, 2012 at 6:45 pm | Permalink

    Quite a run of seriously bad decisions that have a cost measured in the trillions.

    It is ironic that the regulators that like to give such large fines for misdemeanors (often rightly so) are the worst offenders. The EU regulatory pretenders are even worse.

    What a mess, the masses were encouraged to borrow instead of save and now are lumbered with generational interest payments. Their savings don’t generate much of a return for various reasons. Another irony is that because so many countries are on the brink its near a sellers market for those who are AAA who can offer record low returns (plus more derivatives being used on the bond side).

    Well done Mr Redwood for being a voice of sanity for the rest of us for what must be a very frustrating job.

  45. Merlin
    Posted October 15, 2012 at 7:04 pm | Permalink

    The appointment of Turner would be a concern, “Can a Leopard change his spots”, so of the two I prefer Tucker, since , I suppose he is the Deputy. I agree that it should have been a much wider field, a choice of one or two is not very encouraging and gives the impression that no one really wants the job. In relation to the BOE two points:-

    1) nationalization of anything is a bad idea and always fails

    2) QE will cause hyper- inflation eventually and we all remember theses dreadful days of Dennis Healey going to the IMF under the disastrous Harold Wilson.

    Overall, I have to say that the method used to appoint this individual may not produce the best result.

  46. Iain Gill
    Posted October 15, 2012 at 8:11 pm | Permalink

    Andrew Mitchell not been sacked yet?

    • Richard1
      Posted October 15, 2012 at 8:37 pm | Permalink

      Why should he be? This is an absurd witch hunt. The police should focus on catching criminals as they are paid to do not conspiring to force an elected minister from office on the doubtful evidence of his having given one of their number ‘lip’.

      • Iain Gill
        Posted October 15, 2012 at 8:52 pm | Permalink

        bad response

        out here in the real world ordinary decent folk have spent the night in the cells for less

        he has got to go

        and the attitude of ex public school boys and ex army officers that they can talk down to everyone they percieve to be beneath them needs to change, an attitude i come across every day of the week with my working class accent (despite the fact i am better qualified and more senior than most of the clowns doing this)

        etc

    • Richard
      Posted October 15, 2012 at 9:39 pm | Permalink

      It still hasn’t been explained by those manning the gate why they refused a reasonable request to just simply open the gate to let someone through.
      Just who is in charge is a thought to bear in mind.

  47. Mike Stallard
    Posted October 16, 2012 at 3:24 am | Permalink

    On a positive note, it will, in future be possible for the independent Bank Operator to do some clear thinking – and no doubt to clear up the disaster caused by whichever of the two current candidates is promoted.

  48. Conrad Jones (Cheam)
    Posted October 19, 2012 at 1:02 am | Permalink

    Not wishing to put anyone off from applying but the job of Governor of the Bank of England could turn into a poisoned chalice.

    It doesn’t state Nationality so – in theory at least; Ben Bernanke could become Governor of the Bank of England. Not only has he got experience of working in a Central Bank, he’s also got experience of Quantitative Easing – so very little On-The-Job Training will be required which will save the tax payers money …

    Well … perhaps not.

    “Working at the Bank”

    “The physical environment is a big attraction too. Behind the façade of
    our historic building in the heart of the City, there’s a working space
    that’s remarkably up-to-date. For instance, there is a health centre in
    the Bank’s vault, with a medical unit and a dental facility, making it
    quick and easy to make appointments during the working week.”

    Is that where Gordon’s Gold used to be stored?

    Seriously though, this isn’t the type of Job that could or should be advertised in the Local JobCentre in Macclesfield.

    Personnally, I think the International Nature of the Job Offer is good and I would support Professor Steve Keen in the role as his record of predicting the Financial Crisis was – by far; better than Mervyn King’s. Steve Keen (or Governor Keen) actually has a solution that would work, unlike the present incumbent.

  49. swimming pool
    Posted July 28, 2013 at 6:18 am | Permalink

    This car is one of the common things that comes up for car owners.
    A two-year associate’s degree or diploma so they’re sure that you’re not just talented at it, but also have all the required skills that can be stowed in the front luggage compartment.

  • About John Redwood


    John Redwood won a free place at Kent College, Canterbury, and graduated from Magdalen College Oxford. He is a Distinguished fellow of All Souls, Oxford. A businessman by background, he has set up an investment management business, was both executive and non executive chairman of a quoted industrial PLC, and chaired a manufacturing company with factories in Birmingham, Chicago, India and China. He is the MP for Wokingham, first elected in 1987.

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