The Bank is responsible for the inflation mess

According to the government and all the political parties the Bank is independent and responsible for keeping inflation to 2%. Inflation is currently at 10%.

The constitution of course makes the Governor of the Bank report to both the Chancellor and to Parliament. Chancellors have private review meetings with the Bank and Parliament summons the Governor to be questioned by the Treasury Committee. Presumably these contacts are designed to influence and criticise the Bank, otherwise they are a waste of time.

The structure recognised the Bank might follow bad policies which could lead to too much inflation. If that happens the Bank has to send a public letter to the Ā Chancellor and Parliament explaining why and setting out how they will handle the problem. The Chancellor then sends back a public letter commenting on the Bankā€™s approach. The exchange of public letters allows for private exchanges to agree a common line. The Treasury Committee Chair could institute a review of the Bank failure.

On September 22 2021 the Governor wrote the Ā first of a long series of letters reporting faster inflation. He reported inflation above 3%, forecast a further rise to 4%, said it would be temporary and proposed doing nothing about it. The Chancellor, Mr Sunak wrote back agreeing to inaction. Neither letter writer referred to the excessive money printing and ultra low rates that some of us thought likely to trigger inflation. They preferred to blame companies and markets for the Ā price rises.

The Bank was clearly wrong and did not listen to those of us who said donā€™t carry on printing money and buying bonds. The Chancellor could have insisted on a change of policy in private or sent a more critical and tougher letter in public. The Treasury Committee could have woken up and led a public enquiry into the Bankā€™s policy failure.Is 10% inflation the nearest an independent Bank can get to a 2% target?

 

176 Comments

  1. Gary Megson
    November 5, 2022

    Another day, another attempt by John Redwood to blame anyone but the party that’s been running this country the last 12 years for the mess we are in

    Reply All political parties say the Bank is independent and responsible for keeping inflation at 2%. I did want the government to intervene to stop the money printing but was always told by left and right the Bank had to decide, not politicians.

    1. Lifelogic
      November 5, 2022

      The Bank and Boris/Sunak, May/Hammond, Cameron/Osborne. Caused by excessive & over complex taxation & regulation, money printing, the mad expensive unreliable energy/net zero religion, the vast government waste, the lockdowns, test and traces, the net harm vaccines, the Gross Covid incompetence.

      We know Bailey is an incompetent fool, he even gave us 39% personal overdraft rates (one size for all) during his time at the FSA. Unfit to run his own piggy bank.

      Sunak today in the Times ā€œState canā€™t fix all your problemsā€, we all know that mate the problem is the State creates most of the problems with its vast over taxation, the insanity of net zero, currency debasement, poor and declining public services, endless waste like HS2, pointless degrees, renewable and EV subsidies, unfair markets in energy, transport, broadcasting, schools, university, fracking bans, mining bans, drilling bans, misdirected plastic police, failure to control bordersā€¦who on earth after 12 years of the Tory/Socialism thinks the State can fix ā€œallā€ of our problems or indeed any of them?

      Leave us alone and just maintain law & order, borders, defence and not much more please. 20% of GDP in taxation is more than enough for this. Then GDP would be ~ double anyway.

      1. Lifelogic
        November 5, 2022

        Sir John Curtis says that voters are unlikely to forgive the economic incompetence of the Truss/Kwasi budget. But that was never the problem, it was the 12 disastrous years of tax to death, money print, borrow, net zero and the endless waste under Osborne, Hammond and Sunak that caused the problem. Truss/Kwasi merely supplied the last straw.

        1. John Hatfield
          November 5, 2022

          Truss would have been the remedy, given half a chance.

          1. Lifelogic
            November 6, 2022

            She had no chance too many dire greencrap pushing, remainer, big state, tax to death Libdems pretending to be Conservative MPs.

      2. Lifelogic
        November 5, 2022

        Was it not Rishi Sunak who approved the appointment of the dire Andrew Bailey this even after his 39% overdraft rate for all farce at the FCA. He may be an expert on “the impact of the Napoleonic Wars on the development of the cotton industry in Lancashire” but he is clearly totally unsuitable to run any bank at all. Sunak appointing him is as bad a decision as Mrs Thatcher appointed Major as Chancellor a man who etc ed

        1. Lifelogic
          November 5, 2022

          Also, Hunt and Sunak still retain Andrew Bailey despite the clear incompetence, perhaps to ensure that he does not point out what the Sunak/Bailey relationship was over recent years?

        2. miami.mode
          November 5, 2022

          He was recommended by Sajid Javid and appointed by the late Queen Elizabeth.

          1. rose
            November 5, 2022

            He was chosen by Sir Tom Scholar and his number 2 because it was Javid’s first day. Maybe the sacking of Scholar by Mr Kwarteng frightened Bailey into getting rid of that administration before it could get rid of him..

        3. ukretired123
          November 5, 2022

          ‘LL Bailey was out of his depth at the FCA yet promoted beyond his capabilities. Like many other “Executive tap-dancers” when found out by the mega trail of disaster they leave behind they will blame others and never themselves, appearing to outshine their incompetence by numerous subjective plausible excuses available lapped up by the MSM.

    2. Sir Joe Soap
      November 5, 2022

      He’s clearly laying the majority of blame at the door of R Sunak. The shop manager who smashed his own shop window and is now putting his customers’ prices up to pay for it.

    3. Hope
      November 5, 2022

      I see it that the public did nothing to deserve austerity and tax rises for bankers and private business in 2008/9. That was the govt fault in failing to regulate properly.

      The public now faces another hammering in taxes and inflation because of govt, namely Chancellor Sunak and BOE Bailey. Both should have known better. Johnson led by the terrible duo imposed an unnecessary extended lockdown that had no medical benefit. The plans by Hunt as Health Secretary not fit for purpose!

      Sunak, Bailey and Hunt blaming Truss or anyone else for their self induced stupidity. Sunakā€™s lack of integrity seen by backstabbing Johnson in return for PM then lying at every turn to deflect blame, act in contrast to what he actually did and pledged! Serve with integrity is beyond Sunak.

      This is not Putin it is Tory govt stupidity over 12 years on energy, finance, taxation, debt, deficit, immigration, woke public services, failing us over Brexit through institutional corrupt Westminster.

      Sunak and Bailey in cahoots at net stupid reception hosted by King stupid at our expense! We had stupid Carney before currently blaming Brexit! Get rid of Bailey and Sunak we cannot afford these fools.

      1. Hope
        November 5, 2022

        We read Ā£32 million wasted by Sunakā€™s govt checking goods from GB to NI! Our own country JR!

        1. Lifelogic
          November 6, 2022

          Indeed

        2. a-tracy
          November 7, 2022

          Did they break down how that Ā£32 million was spent? Was this since 2021? Was this on the systems? Personnel? How much in the value of goods were sent from GB to NI? I thought we had a trade and cooperation agreement with the EU, NI is effectively treated as though it is in the EU; what is costing so much to use this TCA for one tiny part of our exports?

      2. No Longer Anonymous
        November 5, 2022

        Don’t forget Hancock who was enjoying lockdown, made things extremely difficult for Kate Bingham and is now going to enjoy a fortune courtesy of Down Under having extended lockdown and made it hell for the people who actually obeyed it.

        17 of my friends and relatives have died during since and after lockdown and quite arguably because of it. None from Covid. It may be argued that none Covid deaths were thanks to lockdown but I knew plenty who caught it and survived with mild symptoms.

        The Tory Party is now filth, Sir John. Best you distance yourself from it.

    4. a-tracy
      November 5, 2022

      Gary, we are seeing multiple agencies of the State machine not being willing to take responsibility for anything within their teams and their remit. If a private company handled their customers like this theyā€™d be replaced and out of business. Ambulance chiefs holding off rescuing people in Manchester, Fire chiefs holding off on instructions to evacuate for too long, Home Office chiefs stopping any targets on asylum claim processing. These chiefs are often on double what we pay our MPs they are not without any blame. However, ultimate head of department was Rishi Sunak and he needs to answer this complaint as does the ex-Treasury Committee Chair because the buck stops with them and they canā€™t just say, Ā«Ā oh im in a new job now; bye bye šŸ‘‹ old problem. You lot can all pay for our collective screw upĀ Ā»

    5. James Freeman
      November 5, 2022

      The Treasury Committee, which includes opposition MPs, is as much to blame as the government. Both failed to oversee the Bank, and a different government would not have made any difference.

    6. jerry
      November 5, 2022

      @JR reply; Of course they do, and how convenient for them! Labour messed up 1997-10 and blamed the BoE, the 2010-15 ‘ConDem’ Coalition messed up and blamed the BoE, the 2015-22 majority Conservative govt has messed up and is blaming the BoE….

      1. Peter2
        November 7, 2022

        You set them targets..in the recent case…2% max inflation and they had one job.
        No action until it got to 6%.

    7. rose
      November 5, 2022

      Sir John is marvellously restrained in what he says about the Bank and confines himself here just to its duties to stop inflation. I am seething about its behaviour and so are a lot of people who have observed Mr Bailey closely and followed the graphs etc. It has not kept to a strictly monetary path either, but strayed into political interference, much to the detriment of the country.

      1. Peter
        November 5, 2022

        Bailey was CEO in the FCA which is usually a sign that an individual is incompetent and not up to the job. Regulators in the UK are just there for show.

        He also fell asleep during a meeting between the British Steel pension scheme campaigners and the FCA.

        Draw your own conclusions.

    8. Shirley M
      November 5, 2022

      Reply to reply: then it would be good policy to put somebody who is competent and pro-UK in charge of the BoE, instead of someone who is incompetent or deliberately damaging the UK. WHY does he still have a job? Is there no way of ridding ourselves of this useless and destructive individual, and why are the government not demanding better results from this highly paid person.

      For heavens sake, the politicians in this country seem to welcome incompetents and traitors to govern the country. The electorate have been made impotent, but the MP’s also do nothing to rectify this destruction (or too few of them to make a difference?) We need a complete clear out. The majority of MP’s do NOT work on behalf of our country or are complete thickos with less sense than a local shopkeeper/business owner who knows he must keep his customers happy, or go out of business.

      1. Shirley M
        November 5, 2022

        Following on from the previous post, this government IS putting the UK out of business. WHY?

        1. Shirley M
          November 5, 2022

          I’m doing a Lifelogic with my posts added to posts and hope you will forgive me.

          Likewise with the agreement to the bond sell off which is virtually guaranteed to lose the UK Ā£11 BILLION. Why has the BoE proposed this and why have the government agreed? We want answers, not excuses and passing the blame to others. THEY made the decision. Nobody else!

          1. Merrie qubus
            November 5, 2022

            And now we have the self-opinionated ex BoE Governor, Mark Carney, sticking his unwanted nose in!

      2. jerry
        November 5, 2022

        @Shirley M; It would also have been good policy to have put somebody competent and pro-UK in charge of the Govt! Someone who was willing to have the State proactively back, and if needs-be direct investment in, UK Plc, whatever it took. Getting “Brexit done” was pointless without it, a UK version of Trump’s MAGA agenda [1], but arguably in Ms Truss the grass roots Tory membership voted for inappropriate tax cuts and the continuation of the EU’s style of laissez-faire capitalism (Neoliberalism).

        I actually believe Boris understood the need for a UK MAGA message, hence his ideas about leveling-up and the need for the State to bankroll big ticket investments etc post Brexit, it was just a pity he chose to sign the awful WA and NIP treaties rather than walk away on WTO terms, then allowed himself to be taken down by others inappropriate actions during the Covid restrictions, including at least one person very close to his heart.

        [1] not that Trump ever got around to his MAGA promises, he might have won a consecutive second term had he…

    9. X-Tory
      November 5, 2022

      Sir John is very even-handed in his criticism, making it clear that BOTH the BoE and the government (in the person of Sunak who was Chancellor at the time) erred in not focusing sufficiently on inflation. Where I would differ with our host is that I have always said that I oppose the concept of ‘independence’ for ALL quangos, NGOs, etc, and that includes the BoE. The government is elected to run the country, and the BoE’s economic governance is central to that, so the government must take control and responsibility.

      1. Old Salt
        November 6, 2022

        X-Tory
        Agreed

    10. Nottingham Lad Himself
      November 5, 2022

      Yes, Gary.

      Brexit has added to the UK’s economic woes by lowering the value of the pound and contributing to price rises, an ex-Bank of England governor has said.

      Mark Carney told the BBC the fall in the pound and shrinking economy after the UK left the EU had added to “inflationary pressure”.

      How could it ever have done anything else?

      So Sir John and his lifetime’s work are at least a part of the cause.

      Reply The pound often fell during our time in the EU. Big collapse in pound and output under Labour 2008-10

  2. Mark B
    November 5, 2022

    Good morning.

    All this shows is that the current sham no longer works. It is time we started to roll back the Blair ‘Reforms’ and made the Chancellor solely responsible for all the economic leavers of the country. It worked for Lord Howe and Lord Lawson.

    The then Chancellor and now PM has shown to be nothing but a puppet. Even in front of the lectern he is as wooden as Pinocchio resplendent with a big nose.

    PM Rishi Sunak – A man who comes with strings completely attached šŸ˜‰

    1. Sharon
      November 5, 2022

      ā€œ It is time we started to roll back the Blair ā€˜Reformsā€™ and made the Chancellor solely responsible for all the economic leavers [levers?] of the country. ā€

      The trouble is that the so-called conservative government doesnā€™t have enough conservative MPs to work together to implement conservatism. I agree that Tony Blairā€™s reforms of policy etc should be changed, but as things are currently, thatā€™s unlikely. As many of us have said, the government is behaving like a Labour government.

    2. Ian Wragg
      November 5, 2022

      Levers as well as stri gs. His is captivated by the blob and just an instruction taker. I bet his father in law has some very serious chats with our Rishi.
      HS2 to continue bur the Northern leg abandoned.
      Levelling up my elbow.
      No new power stations but more interconnectors with the EU.
      That should tell us something.

    3. Lifelogic
      November 5, 2022

      Seems so, a serial manifesto ratter, net zero pusher a tax to death puppet who wasted and continues to waste countless Ā£billions. The main cause of the current economic problems with Hunt the disastrous health Sec. now trying to blame Truss and her few days in office.

    4. Sir Joe Soap
      November 5, 2022

      The Bank was and is just scared stupid about increasing rates in case it offends the housebuilding trade who then pull back from building massive estates all over our countryside to house the boat people. Add to that the incoming intergenerational blame game from snowflakes “forced” aka “helped” to buy at low rates which are now rising to help those suffering from high negative rates. The only outlet is the Ā£ which is suffering and will suffer as long as the Bank continues like this.
      Quite who is the largest puppet, Sunak or the Bank is a matter for conjecture.

    5. Hope
      November 5, 2022

      Mark,
      Why should the taxpayer keep being hammered by govt to help private business? 2008 was a bankers and govt failing to regulate issue where the bankers got millions in bonuses and the taxpayer picked up the tab. The prudent, strivers and savers hammered in taxes and lack of interest payments by Tories for over 12 years!

      Tory Govt introduced small energy companies with a fixed price cap, Marxist Cameron called it, knowing in times of tight supply would cause problems and now the taxpayer picks up the tab of energy companies going bust through hikes in standing charges, in addition to Tory govt deceptive underhand green levy rubbish attached to their bills without most people knowing it was attached!

      Five Tory PMs and no one would know the difference between them and Labour. The only difference in fact is that the Tories have the worst economic record on taxation, debt, deficit, inflation, borrowing printing money etc. they also have the worst record on immigration despite years of lying to say the opposite to get elected.

      JR moans again today in trying to deflect blame from his useless corrupt party but who could have changed the rules of BOE and scrapped the quangos as promised! 80 seat majority primarily to deliver Brexit and put UK first, it did not even try! Tory party have utter contempt for its voters and public. Selfish people out for their own ends, they have no other purpose.

    6. Bloke
      November 5, 2022

      It was Labourā€™s Gordon Brown who granted the BoE operational independence over monetary policy in 1997.
      2022 is its Silver Anniversary. Our gold was worth more before Brown interfered. Hi Ho Silver. Now even the Loan Arranger canā€™t cope.

      1. X-Tory
        November 5, 2022

        Gordon Brown is a contender for worst minister of all time. Apart from his failings as Chancellor which you mention, it was during his premiership that Britain’s economy collapsed, and it has never recovered. This graphic is very revealing and shows exactly when Britain fell behind its global competitors – and no, it’s got nothing to do with Brexit! https://e.infogram.com/8c537a79-f5f7-43fb-9481-510373813cf8?parent_url=https%3A%2F%2Fwww.politico.eu%2Farticle%2Fbritain-uk-europe-brexit-wrong%2F&src=embed#async_embed

    7. rose
      November 5, 2022

      Mark, it is the same with the NHS. Mark Francois asked the CEO of NHS England recently, “Who is in charge?”, and got a giggling, equivocal answer. This quango method of spending vast amounts of public money, which Blair and Brown introduced, was precisely to sidestep responsibility, on everyone’s behalf.

    8. Richard II
      November 5, 2022

      Yes, indeed, Mark. The Bank of England was given its independence by Blair in order to reassure the markets that the Labour government wasn’t going to wreck the economy. So after 12 years of the Conservatives in power, why is that arrangement still necessary – do the market still need that reassurance? Well, perhaps they do: I don’t think I’d want Jeremy Hunt’s hands ‘on the levers’ of anything. The real problem with the Tory party is that they have no-one of the calibre of Lords Howe and Lawson. Or if they have, they take care to leave them on the back benches.

      1. Fedupsoutherner
        November 5, 2022

        Richard. They have our host John Redwood.

  3. Peter Wood
    November 5, 2022

    Good Morning,

    Sorry Sir J, totally disingenuous.

    Your point on money printing, what was it’s purpose; so your Government could go out and spend money it didn’t have and didn’t want to raise in taxes!
    Your government is a profligate waste od space without the ability or knowledge to run a fish-n-chip shop, let alone a nation as talented as ours.

    1. Nigl
      November 5, 2022

      Spot on and even more annoying to see the smug, condescending faces of Hunt and Sunak,telling us they are doing us a favour.

      If I see them in person, I hope I have a custard pie in each hand. Bloody clowns.

    2. Lifelogic
      November 5, 2022

      +1

    3. Cuibono
      November 5, 2022

      I remember being shocked when the IMF instructed countries to spend, spend,spend. Spend and then spend some more. I think it was during the Great Imprisonment.
      Not being at all economically literate I thought maybe they had a plan.
      But noā€¦I was right to be alarmed.
      Still canā€™t find out WHY IMF gave that advice. ( Global redistribution?)

      IMF intervened with BoE about Trussā€™s plans to get our debt down.
      BoE is under their thumb IMO.

      1. rose
        November 5, 2022

        Cuibono: the woman in charge of the IMF is a Bulgarian communist and former EU commissioner. Does that answer your question?

  4. Stephen Reay
    November 5, 2022

    It’s simple the government has to take responsibility. By leaving Andrew Bailey in charge they giving the signaling they’re backing him.
    Inflation will not fall if we Don’t match America’s interest rate increase.

    1. Sea_Warrior
      November 5, 2022

      Your closing line gives me the impression that you think that all of our inflation can be attributed to the Dollar/Pound exchange rate. That isn’t the case.

    2. Lifelogic
      November 5, 2022

      Ditch net zero and energy sales taxes & inflation will fall hugely. Pay for it by cancelling HS2, the worthless degrees and all the other vast gov. waste.

    3. MWB
      November 5, 2022

      Why do you people always fawn over, and want to slavishly follow what the Americans are doing. Why not look at how the Swiss government runs it’s affairs.

      1. Lifelogic
        November 5, 2022

        +1 and the place isn’t even flat and has no seaports!

      2. Sir Joe Soap
        November 5, 2022

        Because we’re in a closer indebtedness situation to the Americans, compared to the Swiss. Swiss had to print money to devalue their currency, else it would have gone through the roof. We’d need to unwind our govt borrowing back to when Cameron took over to be in a similar state.

  5. Nigl
    November 5, 2022

    And your shoddy government is now looking to hit prudent savers, many pensioners having saved to support their meagre pensions, one of the worst in Europe. And in other news your tax raids will make this country uncompetitive so, less tax to take and in a vicious downward spiral.

    In the meantime, the guilty in the BOE and the Treasury sail along as if nothings happened, no sanctions, vast salaries, inflation proofed pensions, future honours still in tact.

    Truly a dung heap.

    1. Lifelogic
      November 5, 2022

      Correct. Talk of increasing CGT is appalling at up to 28% without even any inflation indexation is far, far too high already.

    2. Lifelogic
      November 5, 2022

      +1 and with an even larger dung heap waiting in the wings for the next election.

    3. Donna
      November 5, 2022

      Correct. Public Sector pensions (especially in the Governing Class) to be enhanced. Private Sector pensions to be raided, along with any other investment income you may have. Straight out of the Gordon Brown textbook on imposing Socialism: “Means by which you can wreck the middle class and steal / de-value their money.”

      1. Lifelogic
        November 5, 2022

        +1

    4. MWB
      November 5, 2022

      The BoE pensions are not just inflation proofed, they are RPI linked inflation proof. No talk there of scaling back their pension increase so called obligations.

      1. Lifelogic
        November 5, 2022

        As are MP’s one. Still all in it together as they say. Often paid for by taxes & NI paid by people with no pensions at all above the state pension. The cost of a PM for the rest of their lives in pensions, allowances, security and the likes for one ex-MP can easily be more than the tax paid per annum by 2000+ average taxpayers. We currently have 6 ex PMs alive plus Sunak in office. So that is 12,000 taxpayers and we only have 30 million taxpayers in total. About half of them pay no net tax at all, after direct benefits, subsidised housing and schools etc.

        1. Lifelogic
          November 5, 2022

          One ex PM (not MP)

  6. Shirley M
    November 5, 2022

    You say it was the banks ideas, but the government agreed with it, so they were complicit, weren’t they? Both working hard and in tandem to bring the country down and put it in a worse position instead of helping the people who keep the country going, ie. the taxpayers. They are just cash cows for your endless virtue signalling. (You know my feeling about the huge cost of non-refugee freeloaders who are costing us a huge unnecessary expense and will be do so for many years, even if not one more arrival is ‘rescued’).

    Sadly, it is what we come to expect from the people who make these decisions but the electorate are powerless until the next GE and as these decision makers are doing as Parliament and the PTB appear to want, ie. ruining the UK both financially and socially, destroying our families and communities, and destroying our love for country by turning it into a multicultural hell hole where few ethnics integrate and instead dominate cities one by one and shape it into the place they came from and many apply their own laws and ‘traditions’ which conflict with ours. Britain is already unrecognisable in many places. I think you will find that non-Brits are not as tolerant and compassionate as Brits and this will come to the fore in future years as different ethnics start to compete for power over the UK. One religion has a head start and has already acquired much power in the UK.

    There is no incentive for the PTB to get rid of any of the undemocratic and pliable politicians or party because they are so wiling to play into their hands (for what purpose though?), to the detriment of the everyone else, and these are the very people who should NEVER be in Parliament at all. Not if we have a democracy. Do we still have one, or have the non-democrats taken total control? It does appear so.

    1. Berkshire Alan
      November 5, 2022

      Shirley

      Yup it’s what many have been saying for years, growth by importing the lack of skilled immigrants is fake growth, as the initial investment cost of housing, roads, schools, healthcare, benefits etc etc outweighs any possible long term tax receipt benefit.
      I see the BBC have at last woken up that the vast number of Rubber boat people are not real refugees, but gangs of criminals according to their latest broadcasts/reports !
      Well you could have knocked me over with a feather, when will the Government wake up ?
      So depressing reading and listening to news reports from the media for the last few years.

      1. Original Richard
        November 5, 2022

        Berkshire Alan : ā€œI see the BBC have at last woken up that the vast number of Rubber boat people are not real refugees, but gangs of criminals according to their latest broadcasts/reports !ā€

        I donā€™t think youā€™ve got that quite right. The BBC have finally woken up to the vast numbers of criminals crossing the Channel in rubber boats but only to cast them as victims because they have not all immediately been given the warm single hotel room, plus free meals, health and dental Care, Ā£40/week pocket money etc. and as far as the BBC are concerned they now need to sue the Government for compensation.

        The lawyers donā€™t want this invasion to stop and Parliament is full of lawyers who have a death wish for the country.

    2. Iago
      November 5, 2022

      Well said, Shirley M.
      And we should not take any more injections from these truly rotten people.

    3. a-tracy
      November 5, 2022

      Shirley, isnā€™t the cost of asylum seekers and all their related costs coming out of the foreign aid budget, I read it was and they were complaining about that. Isnā€™t spending the foreign aid budget in the UK better than spending the foreign aid budget elsewhere, at least the money slops around in the UK economy.

      The concentration now needs to come on the immigration department and we need to hire in specialists from abroad because our civil servants canā€™t do their job and their unions campaign against removal so they donā€™t want to change either.

      1. Shirley M
        November 5, 2022

        a-tracy – I understand your reasoning, but when will the invasion stop? The government are doing sod all, except pretend to be doing something. Serco have 5 year contracts for housing them so how many will have arrived, and what will the costs be by then. As they are rarely deported and unlikely to be anything but min wage workers they will always be a burden on the country. On top of that, many are ungrateful, violent, criminal and are incompatible with our society with their total disregard for the safety of women as evidenced by numerous rapes by immigrants, especially on minors. They get off scot free for this horrific crime under some judges, because their previous country allowed it. Is this the UK, or not? Do UK laws apply for ALL, or not? Obviously not. We have a two (or several) tier system.

        1. a-tracy
          November 5, 2022

          Shirley, I feel May agreed to this, rushing through ties that bind us. The chap that blew up the car outside the maternity hospital in Liverpool had failed his asylum claim twice and was still here after seven knows, they knew who he was very quickly after the atrocity. When claims fail the UK authorities are letting us all down by not returning on the next plane.

          The guy that raped the young boy this week, he shouldnā€™t even be tried here, he should be returned immediately to his Country of birth. We should negotiate with Albania to provide prison places for all their prisoners in UK prisons and return them. Same for other nationalities over represented in our prisons for crimes in the UK.

          Our government class collectively is weak on this topic and on its knees. All of them no matter what colour rosette. When you get the odd brave one willing to put their head above the parapet they get the Suella treatment. She has the public support to round people up and return them if their claim has failed, no more do gooding.

          1. Shirley M
            November 6, 2022

            Agreed, a-tracy. This government WANTS them, and they want the hard pressed cash cows to fund their virtue signalling even though it is destroying us financially, socially and culturally. Criminals and freeloaders all welcome, else they would do something with their 80 seat majority. They get priority over the LEGAL citizens. Absolute madness and no way for the electorate to get rid of this useless destructive government.

            Entry rules are applied at airports. etc. Why are the same rules not applied to the dinghy invaders?

          2. a-tracy
            November 6, 2022

            Well, we think entry rules are being strictly followed at airports, and ports perhaps they just donā€™t tell us they let them all in from the airport and port if they claim refugee status.

    4. Merrie qubus
      November 5, 2022

      These people can al talk-the-talk, partly as a consequence of mostly having been privately educated. However, they are mainly financially illiterate.

  7. Sakara Gold
    November 5, 2022

    Sunak has printed more money than any Chancelor in history. The Conservatives have spent 12 years of running twin deficits, the national debt has now risen to 100% of GDP. It may be convenient to blame the BOE but the repeated devaluations of sterling mean that any of our exporting businesses can – and have – been snapped up by American buy-out funds, our factories closed and the production moved to Chicago etc.

    Gold has been bought by those wishing to preserve their wealth for thousands of years. Due to the strength of the US dollar, gold is currently on sale

    1. IanT
      November 5, 2022

      Gold may well be a long term “store of value” Sakara but it is far too volatile to be viewed as a short or even medium term investment. The recent movements in UK gold prices (closely tied to $$ Gold prices) are more reflective of changes in Dollar/Sterling exchange rates than anything else. Thus UK Gold is currently more a hedge against the pound falling further (against the dollar) than anything else. US Gold prices may rise if the dollar loses strength but some argue that a more realistic Ā£/$ rate is over $1.30 – so sterling movement in that direction would result in losses here. I do own physical gold ETCs btw, not as an investment but more as insurance. Like any ‘Home’ insurance, Gold costs money to own and is ‘just in case the house burns down’ – so should not to be confused with other investment grade assets in my view.

  8. hefner
    November 5, 2022

    So today nothing about the US inflation at 8+% or in the EU at 10%. Interesting.

    Reply Nor about China and Japan with inflation at 3%. The ECB and Fed made the same mistakes as the Bank of England

    1. Sir Joe Soap
      November 5, 2022

      But the Fed is big enough and ugly enough to get away with high interest rates and the EU just need to add this to a list of problems. The UK historically had higher rates than US, Germany, going back pre-2008 and if anything has more reason now to have higher rates still than them. That was the very reason Emu snake didn’t work here. Rates here should be 5-6% now and looking to head north following the US.

      1. Sir Joe Soap
        November 5, 2022

        Our crack-like addiction to owning property is the reason for this, and you don’t help a crack addict by lowering the cost of crack.

        1. Mickey Taking
          November 5, 2022

          bizarre.

    2. Roy Grainger
      November 5, 2022

      And Switzerland also has an inflation rate of 3% despite importing energy.

      1. a-tracy
        November 5, 2022

        Yes Roy but theyā€™re not fighting other peopleā€™s wars! Theyā€™re not putting 2% nato spending. It pays to be neutral see Ireland.

      2. Wanderer
        November 5, 2022

        I’m impressed by the Swiss and their way of government. However I’ve just googled their net immigration rate and it appears to be double the UK’s. That surprised me. Mind you, it might be an influx of wealthy entrepreneurs rather than trainloads of middle easteners, North Africans and Ukrainians.

        1. Shirley M
          November 5, 2022

          Switzerland do NOT give out citizenship like confetti, as the UK does. The applicants have to prove they have integrated and many other tests. There are no enclaves allowed there!

          1. Mark B
            November 6, 2022

            Correct Shirley

            Before the 2016 Referendum I looked into getting Swiss citizenship. There are many barriers, one being that you have to speak one of the FOUR Swiss languages to a high degree.

            There is a reason why people travel across the continent of Europe and the English Channel rather than just head for Zurich or Bern. And it ain’t because the Swiss lack 4 Star Hotels šŸ˜‰

        2. Sir Joe Soap
          November 5, 2022

          Around 90% European I think you’ll find. As for the remainder, the Swiss are able to take it on the chin to a large extent because they have twice the GDP per person that the UK has. Try working as a tradesperson there without the right paperwork and the locals will put a stop to that pdq.

      3. rose
        November 5, 2022

        The Swiss central bank didn’t print money during the pandemic.

    3. hefner
      November 5, 2022

      So come on, please tell us: if you are so clever, why has nobody in your last 35 years as a MP asked you to be Chancellor?

      1. Narrow Shoulders
        November 5, 2022

        possibly because the role of Chancellor is as much a political position as a financial one. It is not the ideas it is the presentation of the ideas and the reputation of the person making the decisions.

        What Kwasi Kwarteng and Liz Truss proposed was not so outlandish but they did not have the reputations to carry it off.

        1. X-Tory
          November 5, 2022

          1. Sir John has never been appointed Chancellor because he is a GENUINE Brexiteer, unlike all our PMs, and has not been brainwashed by the net zero concensus. So of course they are not going to make him the second most important member of the government. They are afraid of the policy conflicts that would inevitably arise.

          2. Truss and Kwarteng understood the need for growth but were just too bl**dy stupid to adopt the right policies. Firstly, they did not present a BALANCED budget, with spending cuts to accompany the tax cuts. This was just such a basic mistake that I have to wonder what they have instead of brains. And secondly, their tax cuts were all WRONG: they should NOT have eliminated the 45% rate or cut the basic rate, but instead should have raised the personal threshold to Ā£20,000, and they should also have offered a SUPER-DEDUCTION (say 125%) on all investment in buildings/plant/equipment and R&D – THAT would have spurred business investment. Instead they did NONE of these things, so their policies would have failed to achieve their goals and we are well rid of them.

          1. Peter Wood
            November 6, 2022

            Yes, very good points, except I’m not sure about 125% ‘first year depreciation allowance’, that may be a stretch, we used to have 100%, and also for R&D, perhaps open to abuse somewhat, but the right principles. It’s the waste that gets my goat; with NO apparent effort to stop it or recover money stolen. And now Sunak and Hunt are going after pensioners… who do they think vote for the Conservative Party?

      2. Mickey Taking
        November 5, 2022

        for a start Sir John would have to give up better paid positions without the ignorant media sniping daily !

        Reply They knew I would be have been willing to serve in the Cabinet if asked

        1. Mickey Taking
          November 5, 2022

          reply to reply ….the thread started wondering why you hadn’t been asked to be Chancellor. It is even more damning that no leader has invited you to head a Ministry.

      3. John C.
        November 5, 2022

        What a childish comment. Like something overheard in a schoolyard.

        1. John C.
          November 5, 2022

          This was a reply to Hefner.

        2. hefner
          November 5, 2022

          Thanks a lot. But children often ask relevant questions unencumbered by Ā“adultā€™ restraint.

          1. Peter2
            November 7, 2022

            You being the adult heffy
            And all others on here children.
            Gosh

      4. rose
        November 5, 2022

        Hefner, I think it is because the appointment is always political rather than on merit. Throughout the 21st century so far, the PM, whoever it is, has either put in his/her best political friend, or someone politically correct, or someone politically acceptable to the parliamentary party. They never seem to go for the best candidate, Sir John Redwood without a doubt, whichever party is in office.

    4. anon
      November 5, 2022

      not mistakes, maybe just choices.

  9. James1
    November 5, 2022

    It is clear that the actions of the Governor have been woefully inadequate, to say the least. In an earlier age his resignation would have been automatic. As should the Chancellorā€™s have been for presiding over such a debacle.

    1. Shirley M
      November 5, 2022

      + many. How long will we have to tolerate this incompetence, or deliberate destruction? Who cares for the UK? Maybe a handful of MP’s, but no more, but we have no means of removing these traitors in Parliament, and traitors is a VERY apt description. They should be in the tower.

    2. Wanderer
      November 5, 2022

      +1. We live in an era where failure is not acknowledged by what we used to call “public servants”. Inevitably “it’s someone else’s fault”, even though we can all see that’s pure bunkum. The guilty party then has the gall to say that he/she is the person best placed to stay on and see us through the mire. And so we sink even further, while those responsible float above it all.

    3. Bloke
      November 5, 2022

      With over 60 million UK citizens there should be a wealth of talent to provide a sensible BoE Governor.
      Even with access to that vast resource George Osborne went outside to knockout George Carney from Canada.
      Each episode ended with ā€˜Daft, I call itā€™.

  10. Berkshire Alan
    November 5, 2022

    James 1
    The problem is that many MP’s appointed to be Chancellor have no real banking or financial experience either, so they do not have a clue what is really going on, and the effect those policies have for all of us out here, in the real world.

  11. Nigl
    November 5, 2022

    Sunak says we cannot expect the State to fix every problem. On the basis he/the State caused most of them, thereā€™s our answer. Boiler plated lack of self reflection and total denial.

    1. Hector
      November 5, 2022

      Nigl.. no he did not say that.. he said that we (the people) cannot expect the state to fix ‘our’ problems – meaning the peoples problems – so now it’s not the governments problems any more but the peoples’ – anyone can see clearly now where all of this going

  12. Donna
    November 5, 2022

    The Bank may be responsible for not taking inflation seriously in November 2021, but it was the Government who hit the destruct button with the economy when it decided to close down the economy over a virus which they had already downgraded and re-categorised as a Low Consequence Infectious Disease because they knew it had low mortality rates.

    Funnily enough, the evidence of that has now been removed from the Government’s website, but fortunately it can still be accessed on the Web Archive (scroll down):
    https://web.archive.org/web/20200330090938/https://www.gov.uk/guidance/high-consequence-infectious-diseases-hcid#status-of-covid-19

    The Bank of England is only nominally independent. Does anyone seriously believe that Gordon Brown, known for being a micro-manager, would have given someone else the power to effectively run the economy!

    The coming recession they have, and are, deliberately generating is going to be firmly laid at the door of Sunak and the CONS …… just like the ERM debacle was. And in both cases, it’s thoroughly deserved.

  13. Magelec
    November 5, 2022

    From what I deduce neither Bailey or Sunak are fit for purpose. Sunak was far too inexperienced to have been Chancellor during those most critical years. Sunak is not well rounded enough to be PM either.

    1. Mickey Taking
      November 5, 2022

      not rounded enough – but is well heeled enough.

  14. Narrow Shoulders
    November 5, 2022

    The bank of England’s money printing programme is (partly) responsible for the ridiculous price of house and other assets.

    Inflation has been stoked by lockdown supply issues, furlough payments, increases in taxes, a government that thinks it can spend its way out of any issue and the increase in price of gas and oil and grain due to net zero policies and the war in Ukraine. Most of this is down to the Conservative government following proscribed policies from the UN and G7.

    Leaving the EU has introduced limited wage inflation at the lower end and this has not been offset by our ability to buy cheaper products from elsewhere because of Covid lockdown related supply issues.

    This is a mess of your government’s own making

  15. Lifelogic
    November 5, 2022

    Sir John Curtice, the election expert – while Sunak is personally popular, the Conservative Party is lagging behind Labour. Voters, he said, are extremely unlikely to forgive the Tories for Trussā€™s disastrous mini-budget, which contributed to soaring mortgage repayments.

    The Truss/Kwasi mini-budget was not the main cause of this at all, it was gross Sunak incompetence (tax, print, borrow, lockdown and piss down the drain agenda over the past few years) and that of many dire socialist Chancellors before him Hammond, Osborne, Darling and Brown.

  16. Brian Tomkinson
    November 5, 2022

    What prospects are there now for this country with the two culprits still in office, one as Bank Governor and the other now Prime Minister? For some time I have written to say this is the worst government and House of Commons in my lifetime and things continue to worsen as each day goes by. We do not have a democracy that works for the people and there needs to be a massive clear out of sitting MPs at the next election replaced by a new party offering a real alternative to Tweedledee and Tweedledum who have failed us so badly.

    1. Shirley M
      November 5, 2022

      + everything available. We need patriots in Parliament, not these anti-UK and anti-British traitors. This government promotes and rewards failure. They are achieving their aims of destroying the UK both financially and socially, and the electorate are powerless to stop it.

  17. William Long
    November 5, 2022

    The idea that the Money Supply has anything to do with inflation is derided by the Elite who have also given the so called ‘Independence’ of the Bank a similar religious status as that of the NHS. Anyone who criticises is a misguided sinner.

    1. The Prangwizard
      November 5, 2022

      Everyone who criticises the established way being followed, be it of the NHS or the eco obsession, or any other similar embedded grouping, and particularly those believe in the priority of freedom of expression are being labelled as ‘right wing’ and ‘far right’, and their removal from society is being brought about.

      This is deliberate oppression, coupled with tactics of fear. Tragically not enough people in parliament or media for example stand against such and if it not reversed we are lost to authoritarian control.

  18. formula57
    November 5, 2022

    The British establishment views the Bank as it viewed the E.U.: a body that acts wisely except when it does not, but is a jolly good thing that therefore ought never to be criticized adversely, and whilst points can be voiced to it, that should be done with no force and no expectation of being heard. Hence the grotesque failure of the Treasury Select Committee to hold the Bank to account.

    And if the wisdom of such a view is ever questioned, the answer of course is that the independence of the Bank must be preserved at all costs for that is a very good thing indeed, whatever failures it delivers, and proves nothing can be done to alter its wicked ways. So we have inflation five times target and Mr. Putin takes whatever blame cannot be pinned on Covid. Time for a confidence vote in the Governor and Court of the Bank?

  19. James Freeman
    November 5, 2022

    To me, this is proof again that the system of democratic oversight of the Bank of England is woefully inadequate. Things went badly wrong, and no one is to blame! Some people saw it coming but were powerless to intervene. It is the financial crisis all over again.

    The same applies to all government bodies with an effective monopoly over their function. Other examples include OFWAT allowing sewage into rivers, NHS Trust scandals, lockdowns, etc.

    The problem is the institutions involved and those overseeing them succumb to groupthink. Then if there is criticism, they work to silence the dissenting voices. But after things go wrong, it is too late to do anything about it. But the only people qualified to sort it out are those who got us in a mess in the first place!

    To solve this, we need to establish better oversight frameworks. Suppose the system forces the institutions involved to respond to dissenting voices before things happen. Then they will be more likely to change course. If they do not, there can be full accountability.

  20. glen cullen
    November 5, 2022

    Donā€™t forget the evils of inflation induced by net-zero ā€“ I see the BBC reporting that the government policy of decarbonising UK public buildings is estimated to cost Ā£25-30bn

  21. a-tracy
    November 5, 2022

    How did China and Japan keep their inflation at 3%? China is still have close downs now with millions stopped from working.

    1. rose
      November 5, 2022

      Their central banks didn’t print money as the Fed, ECB, and Bank of E all did during the tow years of shutdown.

      China may be shutting people up to keep them off the streets in all the disquiet over their property crash.

      1. glen cullen
        November 5, 2022

        and they only buy cheap energy ie coal and don’t apply any policy of net-zero

    2. Cuibono
      November 5, 2022

      Did China ACTUALLY stop working though?

      1. Mickey Taking
        November 5, 2022

        a couple of major cities closed down – at 10m each – compared to a population of 1400m.

      2. No Longer Anonymous
        November 5, 2022

        Cuibono – They went into overdrive producing PPE.

        1. No Longer Anonymous
          November 5, 2022

          … and then bought up our fighter pilots with some of the profits.

  22. a-tracy
    November 5, 2022

    Sunak to extend freeze on ‘hated’ 55pc pension tax for two more years.
    So private sector pension pots are frozen whilst public sector ā€˜invisible potsā€™ donā€™t pay the same tax rate. Why are Sunak and Hunt not addressing this at the same time – is it perhaps because so many MPs and their families all work in good jobs in the State sector and protect their own retirement income.

  23. Denis Cooper
    November 5, 2022

    Obviously the Bank cannot be held responsible for either the pandemic or the war in Ukraine. On the other hand the government could be held responsible for failing to see that the remit given to the Bank in earlier times might need to be temporarily adjusted to take into account the radically changed circumstances. I said before that we need to avoid making the same kind of mistake as with the ERM crisis, but we are doing that. To repeat:

    http://johnredwoodsdiary.com/2022/08/23/my-conservative-home-article-2/#comment-1336748

    “My mind is going back thirty years to the ERM crisis. Then the stupid decision had been to lock sterling against the German mark, come what may. Now it seems the stupid decision is to keep to the 2% inflation target, come what may, even if the UK is importing inflation at levels which are much higher than that and completely beyond the control of the UK monetary and fiscal authorities. During Black Wednesday, September 16 1992, the Bank announced that the base interest rate would be increased to 15% to try to stem the flight from sterling. Luckily that did not work and by the evening we were freed from the ERM and immediately set on the road to economic recovery. So how high do we now expect the Bank to raise interest rates in a futile attempt to bring down UK inflation to this arbitrary 2% target, how many firms would we be willing to see wiped out, and how many people would we be content to see joining the dole queue, losing their homes and often their families as well?”

    1. Sir Joe Soap
      November 5, 2022

      Interest rates were nowhere near 3% in this period, and we only talking about raising to 5-6% to halt property price increases and consumer price inflation. Giving this back via tax reductions and spending cuts e.g. cancel HS2 , cut NHS bureaucracy by 50% and get these people into private sector work would do the trick.

  24. jerry
    November 5, 2022

    Our host is trying to play the blame game again… Interest rates as set by the BoE are REACTIVE, whilst (inflation causing) fiscal policies are proactive and set by the govt of the day. When as Chancellor, Sunak set out the various Covid/lock-down support packages (in the process telling the BoE to loosen the money supply), indeed many did warn of much higher inflation to come, but at the time, right or wrong, the choice were seen as between higher causalities from CV19 or higher inflation, not that all the current 10+% inflation rate has been caused by that UK CV19 response though.

    “The Chancellor could have insisted on a change of policy in private or sent a more critical and tougher letter in public.”

    So why didn’t he? Perhaps because to do so would have meant the govt having to admit they got their wider policies wrong, having to also admit they were warned; politically far better to wait for the fan to get messy, and the Governors letter to arrive, thus any change of policy from that point on becomes the result of the poorly functioning BoE, not poorly functioning politicos and Whitehall Civil Servants.

    It is time to end the farce of the BoE supposed independence, time it stopped being used as the politicians fall-guy. Whilst allowing politicos to set interest rates (as before) has partisan dangers, such as allowing a govt to cut interest rates to create a mini boom six months before their preferred election date, that is surely better than the current situation where a govt can have a total (economic) policy failure for 12 years yet play the blame game and pass the buck to the BoE.

  25. Atlas
    November 5, 2022

    What you say, Sir John, is only too true. Add to it the wasting of resources on ill-considered Net-Zero energy initiatives and the political pressure to get people, who cannot really afford it, to get a mortgage, and you have a Chinese-saying ‘interesting times’ brew.

  26. ChrisS
    November 5, 2022

    I agree that the bank’s extended Quantitative Easing started the increase in inflation above 2% but that accounts for only half of the problem, the rest is as a direct result of the Ukrainian war and the effect on food, oil and gas supplies.
    How the CEO of any central bank could think that putting up interest rates to current levels is going to do anything other than cause a long recession is quite beyond me.
    The traditional idea of reducing inflation by taking even more money out of the pockets of people and businesses in the current circumstances is having no effect whatsoever other than to cause a recession which by Bailey’s own admission, will be the longest on record.
    Surely it must be obvious that the job has already being done for them with huge sums being being taken out of the economiy through sky-high energy prices.

  27. Ralph Corderoy
    November 5, 2022

    Given our financial system, it’s the Bank of England’s job to run inflation as hot as possible without the peasants revolting against the politicians in order debt is eroded.ā€‚The two-per-cent inflation target is a signal this is so.ā€‚It is measured inaccurately by using CPI so real inflation for various patterns of household spending is higher.ā€‚In addition, the economy benefits from the natural mild price deflation caused by progress in technology, etc., which makes the gap between that and inflation even more.ā€‚So 2% CPI inflation might be 4% real inflation with another 2% of price deflation wiped out by using the pre-deflation price as the basis for measuring inflation.ā€‚(100 + 2 + 2) / (100 – 2) = 6.1%

  28. Roy Grainger
    November 5, 2022

    I saw the interview with BoE chief Andrew Bailey. He said that Andrew Bailey saved the UK economy after the Truss budget caused problems for some pension funds and none of our economic problems are due to Andrew Bailey. He did not have time to comment that the FCA regulator who should have acted on over-leveraged pension funds over the previous few years (having been warned about them) was run at the time by someone called Andrew Bailey. Quite a coincidence.

    1. rose
      November 5, 2022

      Furthermore, he did four things in swift succession which he did not need to do:
      1 He put up interest rates by half, the day before the Growth Statement, when everyone was expecting three quarters, thus setting off a flight from the pound.
      2 He dumped bonds on the market no-one wanted.
      3 He pretended to ride to the rescue of the Pension Funds, which he had failed to regulate, by buying the bonds back at a high price. This is costing us Ā£11 billion.
      4 He announced he would not go on doing this beyond the Friday.

      He might as well have written to the then PM:
      Dear PM,
      You will be gone by Friday.
      Yours sincerely,
      A well wisher.

      1. Mark B
        November 6, 2022

        Sounds like Liz sacked the wrong guy.

    2. IanB
      November 5, 2022

      Roy Grainger +1,. the not me Guv syndrome desperate to separate their own extreme failings from reality

  29. Paul ANDREW TOWNSON
    November 5, 2022

    I agree, interest rates should have gone up much earlier, not doing so has caused excessive borrowing such as mortgages. This has caused people to borrow too much and increased house prices.

    Paul Townson
    Lower Earley
    Conservative member Wokingham

  30. Peter from Leeds
    November 5, 2022

    Sir John,

    I worry when I find myself agreeing with Tim Farron when he says that putting Rishi in charge is ā€œvery much like an arsonist asking for permission to help put out the fireā€.

    We now have a government with a PM and Chancellor that were both the runners up to PMs who had been elected by a majority of Conservative members.

    Our current PM seems to be trying to blame our current mess on the policies of Liz Truss – which is tantamount to telling the majority of Conservative Party members that they were wrong and he was right all along.

    I have no idea why no politician has the bravery to say that Blair and Brown got it wrong in 1997 when they made to BoE independent. They just wanted someone else to blame if inflation got out of control (which it always does at some point). Most intelligent people realise you cannot keep printing money and having interest rates at levels never seen for 300 years without serious consequences.

    This current financial mess is not down to Liz Truss, Putin or even the EU – it is an inevitable consequence of “cheap money” leading to asset price bubbles, zombie companies, low productivity, increasing wealth disparities and high (and if you are very unlucky – hyper) inflation. History is full of examples (one in Europe just 100 years ago – with hyperinflation triggered by a government paying people wages to stay at home and not go into work).

  31. ignoramus
    November 5, 2022

    Quite surprised by this argument. It’s not good.

    Inflation is clearly a worldwide phenomenon and is down to the increase in energy inputs as a result of Putin’s crazy war.

    A number of central banks have tried raising interest rates. It hasn’t worked. America has the world’s reserve currency. It hasn’t helped.

    You cannot blame the Bank of England for this.

    Er… you claim China and Japan have inflation of over 3%. Conveniently ignoring the fact that China is able to buy cheap energy for Russia, and is therefore exempt from the same energy cost rises as everyone else. Japan, being the main trading partner with China, is also sheltered. But thank you for making my argument for me.

    1. Roy Grainger
      November 5, 2022

      And Switzerland ? 3% inflation.

      1. ignoramus
        November 5, 2022

        Apparently, the 3.2% inflation rate is a peculiarity of the strong Swiss franc.

        I would list all the countries that are suffering roaring inflation at present, but I believe there are very many.

        Again, a result of Putin’s war. I can’t actually believe anyone disagrees with me on this.

        Reply And 3% inflation in China and Japan, the worldā€™s second and third largest economies, both with currencies falling against the dollar?

        1. Philip P.
          November 6, 2022

          About “Putin’s war”, anyone who knows the facts must disagree with you, Ignoramus. The war in Ukraine began as a civil war in 2014 when the Kiev government sent its army in to crush the Russian-speaking Donbas region, which had declared autonomy after the overthrow of the Yanukovych government. The following eight years of fighting saw at least 14,000 deaths. This February Russia announced it was intervening to try to put a stop to the slaughter of civilians in the Donbas region. Whether that was a successful move remains to be seen, but the war certainly did not begin just when Putin ordered the Russian army in.

          1. ignoramus
            November 6, 2022

            Er … the Donbas region declared autonomy because Putin sent in a bunch of militia, so I would say he started it.

            He then sent in the troops to invade Crimea.

            He then has since attempted to invade all Ukraine.

            The Russian people don’t want this disaster on their hands. The Ukrainians certainly don’t. So, yes, I continue to hold Putin responsible in every way, both for the way and the misery he has and is inflicting on his own people.

    2. Mark
      November 6, 2022

      The Bank if England has been forthright 8nsupporting ESG measures which have even instrumental in preventing adequate investment in key energy supplies. They are deeply involved in creating the energy crisis, with the efforts of the previous governor being particularly egregious.

      1. Original
        November 6, 2022

        Mark :

        Correct.

    3. Old Salt
      November 6, 2022

      IGNORAMUS
      The fact that the west ignored the massive build-up of invasion capable forces around Ukraine until it was too late didn’t help. Some keen observers identified this but were ignored by those who are now to blame and we are now paying the price.

  32. Bert Young
    November 5, 2022

    Our economy was – and still is , in the grips of international affairs . The turmoil in the heart of the CP has not helped and the markets responded . The B of E had no choice but to act and steady things down , Sunak rightly supported . It will be some time before events change ; events in the USA , China and the Ukraine are the significant triggers ; we on our own are relatively insignificant .

  33. Norman
    November 5, 2022

    Thank you for keeping going, Sir John, when there’s so much that must cause you gloom. This is also apparent in the daily comments on this blog, about which so much could be said.
    Saturday is a gardening day for many, and there’s a lovely sweet pea called ‘Castle of Mey’, creamy-white with a beautiful perfume, which can be sown now and overwintered. The name commemorates the Scottish home of the late Queen Mother, but also reminds me how blessed we’ve been as a nation and Commonwealth. We were never whiter than white, but I am so, so grateful for that fragrance of the Spirit, and the things which made for our peace – things now largely hid from our eyes (Cf. Luke 19:41-43; Deuteronomy 28).
    The Battle of Britain did not end in 1940! But God our Saviour is still on the throne, and his word to us is faithful still.

    1. Peter
      November 5, 2022

      Bit wet for gardening today Norman.

      Most of the petunias have gone. Begonias and Busy Lizzie’s still going strong.

    2. No Longer Anonymous
      November 5, 2022

      I was at work at the weekend, as usual. Starting at 4.30am today.

  34. Colin
    November 5, 2022

    Bank “independence” has clearly failed. If we are to have a system whereby the base interest rate is set by some authority (rather than simply being the market rate for credit), then that authority should be someone who is accountable to Parliament and the public for their decisions. We should either take the radical option of abolishing central banking altogether, or return to the system of interest rates being set by the Chancellor.

  35. Caterpillar
    November 5, 2022

    It does appear true that Mr Sunak as Chancellor and Mr Bailey as Governor have done catastrophic damage to the UK, though admittedly in a context of several decades of pre-existing damage.
    There appear to be (at lest) two issues, the first that Sir John has eloquently written on many times ā€“ what to do now to fix the near and medium term, but I think the second i.e. how to reduce the chances of poor monetary policy decisions within a democratic system, also deserves attention.
    There are three, not mutually exclusive, suggestions that I have seen and believe ought to be further discussed:
    1. The inflation target needs to be absolutely clear and dominant (e.g. <2% with no other attachments such as growth, green agenda etc.)
    2. Systematic monetary policy must be introduced i.e. actions should be transparently recommended from best models (rules) or weighted combination of best models. MPC & Governor can override these but explanation must be given. Such an approach then demands academic economists to debate and improve on models, and importantly allows Chancellor, MPs & journalists to ask precise questions about decisions away from best theory.
    3. Ending the operational independence of BoE and returning final monetary policy decisions to the Chancellor. The arguments for this are (i) not ducking responsibility, (ii) if BoE cannot manage inflation and decisions are more broadly taken then these are political, and (iii) the requirement for MPs to improve (consider the quality of monetary debates in Hansard in the early forties, or the seventies).

  36. Bryan Harris
    November 5, 2022

    Another failed quango, instituted to take responsibility from those that would rather not have it.

    When is parliament going to take measures to bring such organisations properly within their control, so that we can see more clearly where the actual problems are?

    Our failed state, it seems, can only breed national disasters in one shape or another, but it would be nice to see who sits at the top of each branch and open to real censure, rather than what we have at the moment where responsibility is dispersed into a quango where nobody can be truly found guilty of mismanagement, and ministers shirk behind the smokescreen.

  37. Kenneth
    November 5, 2022

    Off topic (sorry) The BBC today reports that “Dover attack driven by right-wing ideology – police”.

    This is incorrect. The police used the term “extreme right wing” not “right wing”. A big difference.

    Link to BBC’s biased fake news item: https://www.bbc.co.uk/news/uk-england-63526659

    The BBC seems to think that “Right wing” is a bad thing and has deliberately tried to associate the term with a violent act.

    It is time the BBC was properly dealt with. It cannot be allowed to get away with these attacks

    1. anon
      November 5, 2022

      Birds of a feather. No decision to make the BBC a voluntary subscription like others. They could broadcast free to air if they wish for contracted but open competition public service broadcasts – funded by advertising.

      Note the in an economic squeeze caused by political net zero policies as implemented.

      Easiest tax cut ever. Every little Ā£159 helps. No extra admin. No means test.

      QED. Its value to the establishment as a propaganda outfit. You can bet they will priority for rationed energy.

    2. Shirley M
      November 5, 2022

      The BBC was going to be dealt with by another all talk and no action MP, Nadine Dorries! She was too busy fawning over Boris to do her actual job!

      1. Mickey Taking
        November 5, 2022

        embarrassingly doe-eyed.

      2. jerry
        November 5, 2022

        @Shirley M; Perhaps Nadine Doris looked at the facts, rather than the rhetoric, and realized that if she was to ‘deal with the BBC’ (unless to be seen as blatantly bias against the BBC…) she would also have to deal with the very similar problems found within all the other TV and radio broadcasters. Be careful what you wish for, in the USA their FCC (the equivalent to our Ofcom) abolished its own ‘fairness doctrine’ in 1987, since when left leaning mass-media corporations now vastly out-weight those of the right, certainly on broadcast TV…

      3. Original Richard
        November 6, 2022

        Shirley M :

        A majority of the Conservative Party are completely in approval of the views and bias of the BBC, it’s just that they don’t admit it and hence the reason why no action is taken.

        The Government could, for instance, request all the TV and radio broadcasters to keep “analysis” and comment out of “the news” and only allow “analysis” and comment in a completely separate programme.

        And the BBC should be told to change the title of their news programme from “BBC News” to “BBC’s News”.

    3. jerry
      November 5, 2022

      @Kenneth; Yours is the usual nonsense on stilts, typical bias against the BBC, given GBNews currently has an even worse (insipid) headline to this story, it’s even embedded in their URL (published/updated at 11:46);

      ..//..gbnews.uk/news/dover-firebombing-attack-motivated-by-terrorist-ideology/384119

      Of course, once beyond the headline all becomes clear, both the BBC and GBNews making clear that it was “motivated by an extreme right-wing terrorist ideology”.

      1. Kenneth
        November 5, 2022

        The difference between the GB News story and the BBC story is that the BBC headline left out the word “extreme”.

        The BBC has no right to add its own angle to a news story, especially in the headline, and, in doing so, imply that right-wing (minus extreme) is somehow bad.

        1. jerry
          November 6, 2022

          @Kenneth; Nonsense, I even posted the GBNews URL as proof.

        2. Peter2
          November 7, 2022

          Well said Kenneth
          You are right.

  38. XY
    November 5, 2022

    Is it a coicidence that the UK is seeing this mis-manegement while the EU struggles?

    There sees to be a cabal of remainers who are determined that Britain will not succeed, at least not as long as the EU fails, in order to keep alive whatever case there may stil lbe for rejoining.

    When I look at the timing of our problems and their effects, that is the only common factor that I can see. We seem to constantly elect or appoint individual who care about the EU – perhaps because they are the people who are willing to give up their working life to achieve political goals.

    1. Shirley M
      November 5, 2022

      It is no coincidence, XY!

  39. agricola
    November 5, 2022

    We are where we are. Not a time for recrimination, but for accurate appraisal of where we are and the production of ideas to incentivise the wealth creators. You will kill the economy stone dead by increasing tax any further and the wealth creators will just move to where they are undestood and appreciated. November 17 is a critical tipping point, get it wrong and the conservatives are toast. Labour, SNP, Lib/Dems et al have no answers but negativity. I sense that a new party of the right will emerge with instant appeal to true Conservatives and the Red Wall.

    1. Shirley M
      November 5, 2022

      “I sense that a new party of the right will emerge with instant appeal to true Conservatives and the Red Wall.”

      Here’s hoping. I just hope the UK can survive the next two years, but I doubt it will be a UK we want to keep. Much of the damage done is irreversible.

  40. Mickey Taking
    November 5, 2022

    This is precisely the right time for recrimination. Sir John and lots of contributors on here have been pointing out the daily mistakes and short-term stupidity. Get a grip – what masquerades as a Government.

  41. Trod
    November 5, 2022

    It appears the only way for the BOE to deal with inflation now is to cause a recession. This is dangerous territory, because it might not work. According to Elliot Hedge Fund, if wages increase to counter the high consumer prices, hyperinflation may occur.

    https://www.msn.com/en-us/money/markets/hedge-fund-giant-elliott-warns-looming-hyperinflation-could-lead-to-global-societal-collapse/ar-AA13GPFd

    1. Mark B
      November 6, 2022

      I agree, and have mentioned it here on this site before. This is why I (see above) have argued that the Chancellor should take back FULL control of the UK economy.

  42. Lindsay McDougall
    November 5, 2022

    In all probability it is meddling by politicians that has been partly responsible for the BoE departing from the straight and narrow. The ideal is that the BoE is told to stick strictly to the knitting – 2% inflation – and ignore ALL political representations. That way there are only two issues to be decided:
    (1) Should the inflation index used be CPI or should it include some measure of asset prices, particularly house prices?
    (2) Should the inflation target be steadily reduced to 0% in the medium term?

    Before WW2 individual prices would bob up and down but there was no general inflation (indeed, the Wall Street crash of 1929 was caused by a 25% contraction in the USA money supply, according to Milton Friedman). Systematic inflation has been post-WW2. Zero inflation would entail some wages and salaries going down, which would cause some pain but prevent people from living in a fool’s paradise.

    1. Mark B
      November 6, 2022

      \our kind host has made many arguments about whether or not the BoE is truly independent.

  43. Stephen Reay
    November 5, 2022

    First signs of protest on the streets of London today, the first of many to come.
    The government needs to be careful not to punish the people for their mistakes.

  44. Original Richard
    November 5, 2022

    I read that the Monarch appoints the Governor of the BoE following a recommendation by the Chancellor of the Exchequer.

    I would suggest a better method for selecting the Governor is found and it should be mandatory that the Governor is British.

  45. acorn
    November 5, 2022

    Sadly, I did mot pass moderation today. Trying to speak truth to Thatcherite legacy MPs is very difficult now.

    Reply I do not have time to check your links. Write what you want to say

    1. Mark B
      November 6, 2022

      reply to reply

      I for one would like to both read and see the links from acorn. I do not agree with him politically but he, like me, does not post often and is always on topic. Unlike someone I could mention who constantly posts a provides links to site totally unconnected with the subject of the day.

  46. No Longer Anonymous
    November 5, 2022

    Sir John. What’s needed – seeing as the party cannot be reformed from within – is the ‘right wing’ to quit and to alert the public that, as soon as anything resembling a Conservative government is elected, the country is made ungovernable by the BBC, civil service, WEF, wokeists and Unionists and they set the entire agenda.

    It needs 20 or thirty of you to do the same at the same time. Country before party or even personal career. We are in a state of existential crisis and the good people of this country are imperilled.

  47. Simon R
    November 5, 2022

    Dear Sir John,

    I am sure you agree, this simply will not do:
    https://www.itv.com/news/border/2022-11-02/decision-on-controversial-new-coal-mine-postponed-for-a-third-time

    This mine will produce coking cole for the steel industry – a strategically vital industry, which we currently import coal for. There is simply NO reason and NO excuse for this delay.

    I hope that you can find time to pursue this with Michael Gove in your usual formidable way.

    Best,

    SR

    1. Mark B
      November 6, 2022

      It is things like this that tell you that we really are in big trouble.

      Bring on the blackouts. It is the only way to make people see sense.

  48. Original Richard
    November 6, 2022

    The way to cure inflation is to stop all public employees having inflation related pensions, starting with the MPs, Civil Servants and quangos

Comments are closed.