The Bank of England insists on getting it wrong

Headline inflation has come down to 2%. The European Central Bank has made its first cut in interest rates. Suspicious Conservatives think the Bank wanted to deny them a rate cut before the election , to offer up an introductory one in August to the new Labour government all the pollsters and most commentators say we are going to get.

It shows the difficulty for a so called independent Central Bank to keep out of politics. To the main parties this decision was a crucial one.Cut rates and reinforce the Prime  Minister’s message that we have turned a corner, the economy is on the mend. Leave rates up for a few more weeks and reinforce the Opposition view that it is all a mess.

So let me show balance. The Bank given the ludicrous way it seeks unsuccessfully to keep inflation  down followed its own method in deciding on further delay. It could argue that service sector inflation is still elevated and not coming down as quickly as the forecast it made so the Bank needs to be cautious. The Bank also of course yet again needs to thoroughly review how it forecasts inflation as it got it wrong again.

Housing inflation remains elevated within services.Rents  keep rising in part because migration still runs hot. Owner occupiers face mortgage hikes thanks to Bank policy. There are “ reasons” for the Bank to hang tough.

The disgrace however comes in the key Bank policy most media and politicians refuse to talk about – the Bank’s wrong decision to keep selling bonds at huge losses and send the bill to taxpayers. No other Central Bank does this. Even the Fed, cutting its bond portfolio aggressively as bonds mature has reined this in in recent months, realising the damage it can do.

When I was asked to comment yesterday on the lack of rate cut the media would not consider the far more important Bank decision to keep on selling bonds. Why?

103 Comments

  1. Donna
    June 21, 2024

    Of course the Bank delayed an interest-rate cut. We’re in the middle of a General Election so they won’t do anything which might be interpreted as “political” – particularly when it might help the Tories.

    Blair and Brown politicised the entire Civil and Public Service, including the Bank of England. Over the last 14 years the LibCONs Cameron, May, Johnson and Sunak have done nothing whatsoever to reform, or better still, dismantle it.

    We have a Globalist/Socialist State which is not run in the interests of the British people.

    We can vote for whichever Party we like and it will make virtually no difference because the Socialist State rules. And that is why the Not-a-Conservative-Party is going to be obliterated; by its inaction, it has made itself obsolete.

    The Not-a-Conservative-Party could have stopped the Bank of England’s destructive policies, but it chose not to.

    1. Lifelogic
      June 21, 2024

      Indeed see the excellent article by Matt Ridley in the Spectator.

      Whoever you vote for the Blob wins.

      1. Mitchel
        June 21, 2024

        He’s only stating what has been obvious for a very long time.The oligarchy (blob) always wins because the UK is not-nor has it ever been -a true democracy.

        Look up Robert Michels 1911 ‘Iron Law of Oligarchy’ to understand why.

        You cannot vote the system out;it has to be smashed.

    2. PeteB
      June 21, 2024

      Not cutting rates is as political a decision as cutting them. The solution is to take rate setting powers from the Bank and allow the Market as a whole to set the price for borrowing money.

      1. PeteB
        June 21, 2024

        p.s. Look how well things went when the Bank tried to set currency exchange rates.

        1. Peter Wood
          June 21, 2024

          6 Month US Treasury Bill yield 5.34%
          6 Month £ Gilt Bill yield 5.2%
          We are still increasing the national debt, we can’t lower rates until the US does.

      2. jerry
        June 21, 2024

        @PeteB; The Markets do set their own rates, as @Lifelogic points out in one of his replies to my own comment elsewhere, indeed if only the commercial and High Street banks had to mirror the base rate!

        The rates under discussions are those relevant to borrowing from or through the the BoE, are they not. what you suggest is thus a bit like allowing the person taking out a commercial or retail loan to set the interest rate they will have to pay on their own loan – what could possibly go wrong… 😕

        If your PS is about the ERM fiasco, that wasn’t the BoE, it was the then govt via the BoE, hence why in 1997 Gordon Brown gave the BoE its notional independence.

        1. PeteB
          June 21, 2024

          @jerry if a commercial bank (or other business, or individual) wants to borrow money then they see what they need to pay based on market rates. The BoE should be a “lender of last resort” and if a commercial bank needs to borrow from the BoE the rate can be derived based on latest market rates + a risk premium.
          I agree the ERM was a gowernment policy enacted by the BoE. I was illustrating the futility of such bodies assuming they can set the price for a market.
          When the UK economy finally sinks under excess government borrowing will will see in the gilt markets what the true market interest rate is.

          1. jerry
            June 21, 2024

            @PeteB; But as I said, the Market can not set the rate for the lender of last resort as it is all to often the Market who needs the loan, most of the time they would be setting the terms to their own interest payment! This has never been a problem before…

    3. Lifelogic
      June 21, 2024

      Indeed the fake Conservatives could also have stopped ULEZ, the road blocking, net zero, the net harm lockdowns, the net harm Covid “vaccines”, the Post Office fraudulent claims, the soft loans for worthless degrees, the vast tax increases, the vast over regulation, cut back the bloated and totally useless state sector, cut taxes…but they preferred to do the reverse.

      1. Sir Joe Soap
        June 21, 2024

        Indeed. So much time, so many mistakes.
        Interest rates would never have had to go to this level if Sunak hadn’t printed and thrown money away in 2020-21.
        Probably still correct at where they are until both services and goods inflation at 2% for 6 months or so. The Pound is hardly strong as an ox, is it?

    4. Ian Wraggg
      June 21, 2024

      The BoE obviously never got the memo from Klaus or the IMF
      Watch the rates tumble under Starmergeddon and he will be waxing lyrically how his plan is working and the government can borrow to “invest” in public sector pay rises at bargain rates.
      One year and we should be bankrupt
      Thank goodness Nige is there to call them out.

    5. jerry
      June 21, 2024

      @Donna; “Blair and Brown politicised the entire Civil and Public Service, including the Bank of England. “

      You seem to have a very strange definition of “politicized”! Prior to May 1997 the Chancellor used to set the level of interest rates directly, slashing them when the govt wanted to boost the economy, or create a fails ‘Feel Good’ factor, raising them when the govt needed to reign in that ‘Feel Good’ factor, or market speculators, often for wholly political, not solely economic, reasons.

      Both the Civil and Public Services have always been politicized, other than whenever the former is in “purdah”, a Civil Service carrying out party manifesto policies is clearly politicized.

      As for your second from last paragraph Donna, as if it will be an anti “Globalist/Socialist” party gaining the most votes come 4 July, what must the electorate be thinking…

      1. Donna
        June 21, 2024

        Jerry. The individuals working in the Bank of England and the Civil Service were politicised. Public Sector Institutions are infested with people who support/endorse socialist policies.

        I’m a retired Civil Servant. I have experienced the group-think.

        1. jerry
          June 21, 2024

          @Donna; Dog Whistles at dawn, the usual “Group Think” accusation…

          Back in the 1980s when the Chairmen of key UK Nationalized industries enacted key decisions for their Corporation, company or industry, were such people acting independently, solely in the best interests of their charge, or where they subject to directives set by the political govt of the day; if those Chairman had obstructed such “politicized” directives, or just appeared to do so, how long do you think they would have lasted in post – as indeed a then Chairmen of BL Plc found out!…

      2. Martin in Bristol
        June 21, 2024

        The big difference Jerry. is that the Chancellor and the Government are answerable to the voters.

        It is ridiculous to try to claim that Government employees are politicised just because they are doing their job enacting policies made law by an elected Government.

        1. jerry
          June 21, 2024

          @MiB; Except the govt once elected is not subject to the will of the voters, unless a referendum is called! Who do you think govts tend to try and get their most unpopular policies done and dusted at the beginning of their term, so by the time the next election comes around the plebs have forgotten!

          1. Lynn Atkinson
            June 21, 2024

            All governments must be re-elected – thus they are always subject to the Will of the voters – unless they don’t mind losing power….

          2. jerry
            June 22, 2024

            @LA; Lucy, try replying to what I actually said; your comment suggests your knees jerked after the first sentence, thus you never read the second!

            Whatever.

    6. Hope
      June 21, 2024

      Donna,
      …By its inaction…. No, the Tory party built on Blaire’s policies, heir to Blaire Cameron, it built on “Red Ed’s” “Marxist” energy policy and hired former Labour ministers under Blaire in preference to its own former conservative ministers.

      These were deliberate choices, not mistakes or accidents. Furthermore, Tory party deliberately did not balance structural deficit and pay down debt by 2015,2017,2019, 2021 then kicked into touch by Hammond. It claimed there would be 80% cuts and 20% tax rises, therefore we rightly assumed the state would be cut back. The opposite happened where we have the highest taxes in history since the war! All along deliberately lying saying they were low tax Tories! Immigration was a deliberate choice while deliberately lying to the public, not accident, no one else fault. Cameron followed Blaire’s Iraq war by fueling mass migration by Libyan war for regime change. Afghanistan war went on for decades what was the loss of life, limb and costs to taxpayer for after leaving the Taliban in charge? We currently have a police service not knowing what its purpose or role is!! Riders by knife crime a daily occurrence and sentient of these get about 15 years! Out in 71/2 half years under the No law and order under the Tories. Trecherous May wrecked the police service.

      Hunt health secretary for six years failed to address health tourism, failed to prepare the NHS for a pandemic after exercising for one under Op Cygnet! Hunt was Rejected by his party but nevertheless now made chancellor!! Sunak failed the nation and made school boy errors costing £12 billion and maxed out UK debt and borrowing to the highest levels in history. JR wonders why there are huge failures in BOE, I say look no further than Hunt and Sunak! These chumps are not fit for purpose, yet Tory MPs I posed the. On the nation like their wretched EU, police commissioners and mayors rejected by the public.

      No wonder 77 MPs have run off before the election fight!

    7. Ian B
      June 21, 2024

      @Donna – Cameron, May, Johnson and Sunak have all been working to achieve a one party Socialist State so there was no interest in establishing a free sovereign democracy, that would have been to acknowledge as with the rest of the free world that Conservatism was the way forward for a prosperous community

    8. Delphine Gray-Fisk
      June 21, 2024

      Well said!

  2. jerry
    June 21, 2024

    Would our host be complaining if it was Labour about to loose the election, stop being so obvious.

    A rate cut yesterday would have been milked by the Conservatives for all it was worth. The fact that the BoE refused to be drawn into the election proves why their notional independence matters at times, just as it does with the Civil Service and their own purdah. More fool Sunak for calling the election just he must have known a rate cuts was very likely!

    Anyway, savers, those doing the right thing (as Tories use to demand), will be happy. Look on the bright side, the Conservatives might actually retain some of the 50+ & pensioner vote, despite the awful state of the NHS and social care system…

    1. Lifelogic
      June 21, 2024

      The BoE is supposed to be independent so should have taken the decision on purely economic grounds. The case for a cut was overwhelming – indeed well overdue. They were very late to increase rates and are now late to cut them. Gross incompetence as usual.

      1. jerry
        June 21, 2024

        @LL; “The BoE is supposed to be independent”

        That is exactly what they have been, as are the Civil Service during “Purdah”.

      2. Sam
        June 21, 2024

        Totally agree LL
        Jerry is in a contrary mood again.

    2. Lifelogic
      June 21, 2024

      Well you say savers will be happy but the rip off bank middle men at taking huge spreads between lending at base plus 5% to 35%+ and deposits paying 0% to circa 4%. Many big banks charging 40% of personal overdrafts thanks to the FCA lunacy.

    3. Lifelogic
      June 21, 2024

      “A rate cut yesterday would have been milked by the Conservatives for all it was worth” indeed well they have virtually no other positive claims to boast about from 14 years of government.

      Though Jeremy Hunt was on tape moaning of ‘our total failure to appreciate the Conservative’s superb record of 14 years’ – what very stupid voters we obviously all are.

  3. formula57
    June 21, 2024

    We are now decades on from Chancellor Lawson’s “teenage scribblers” gibe and there are very few proper journalists anymore, they having been replaced by infotainement industry operatives for whom interest rate changes make for easy headlines contrasting with reckless antics in the secondary bond market that indicate effort and application to understand and then explain that is unlikely to be rewarded perhaps?

    I have asked Chancellor Hunt why he has failed to implement your proposals relating to Bank bond holdings and regret I still await a reply. Perhaps he is busy.

    1. Lifelogic
      June 21, 2024

      Indeed Lawson got most things right, alas not his D/M shadowing and the disaster of Major/Treasury/BoE/Blob’s enthusiasm for the ERM and Euro disasters. Lawson certainly was right on the total insanity of net zero. He even read PPE Oxon though he originally went up to read maths it seems. Perhaps it was the PPE “education” that made him get the ERM so wrong? Should have stuck to Maths or Physics perhaps.

  4. Peter Wood
    June 21, 2024

    Good Morning,

    Sir J. to answer your last paragraph question, answer these two:
    1. Of the 400(?) Billion £’s ‘created’ by the BoE, at the insistence of Treasury, between 2020 and 2023, how much has been removed from the economy or ‘destroyed’ ?
    2. What was the total £ Money supply in the economy in January 2020 compared to January 2024?

    I think you’ll find your answer.

  5. DOM
    June 21, 2024

    Bailey’s not a banker, he’s a political animal. Oh, and a Europhile and that fact alone explains why he refuses to cut rates.

    I find it odd that John doesn’t use his blog to warn voters that Starmer will without question take the UK back into the EU. Why doesn’t he? Is John under orders from his own party?

    Anyone find it odd that Sunak, Hunt etc refuse to expose Starmer’s vile history? Why won’t these so called Tory leaders get personal with Starmer? The loathsome Cameron is an ARDENT EUROPHILE. Let that sink in.

    The two main parties want the UK back in the EU (though Euro fanatic Tory leaders don’t want to be seen to be treacherous) and Brexiteers like John and others remain silent on this fact

  6. MPC
    June 21, 2024

    Meanwhile The Guardian announces that Chris Skidmore is going to vote Labour. Well what an earth shattering surprise. Still no mention of Mr Skidmore’s future employment plans though (I think we can guess).

    1. Donna
      June 21, 2024

      Funnily enough, Alok Sharma, former Net Zero Minister and the man responsible for blowing up our coal-fired power stations and wrecking our energy security has recently been given a job by the Rockefeller Foundation ….. to advance Global Development and Climate Action goals.

      What a surprise. NOT.

      1. glen cullen
        June 21, 2024

        He was never a real tory

    2. Lifelogic
      June 21, 2024

      +1

    3. Timaction
      June 21, 2024

      I thought Skidmore was given some climate change religion non job? It will of course cost us loads of money for no purpose.

  7. Richard1
    June 21, 2024

    Andrew Bailey has been a disastrous appointment. He should never have got the role following his hapless tenure at the FCA. The MPC (I believe with one exception) is another example of blobbish groupthink. It contains no diversity of views.

    Perhaps not deliberately Bailey has done a huge service to Labour as his terrible governorship has done so much to undermine the Conservative govt. of course they should have given him the boot. A knighthood from sir keir will doubtless follow the election and some other very comfortable blobship will follow his eventual retirement.

    1. Lifelogic
      June 21, 2024

      Bailey and Carney have been total disasters as have Chancellors Brown, Darling, Osborne, Hammond, Javid, Sunak…

  8. Bloke
    June 21, 2024

    The PM claimed that when he became PM in Oct inflation was 11.5%, and in the 18 months since, HE had reduced it to ‘normal level’ (actually still ABOVE the BoE target of 2%). However, who was Chief Secretary to the Treasury in July 2019 and Chancellor of the Exchequer before he became PM?
    He claimed immigration was going down when the interviewer demonstrated it was far higher. Asked when it had gone down from he replied: when it was higher! The studio audience laughed at his stupidity.

  9. JayCee
    June 21, 2024

    I can tell you ‘why’, John.
    The media do not understand the bond sales as they never really understood QE.

  10. Berkshire Alan
    June 21, 2024

    “Why”
    Because like every other Government and Local Authority department they are incompetent, and inefficient, very highly paid senior managers and staff, time and time again are shown not to be up to the job, indeed so many are now working from home that the whole set up is far, far too casual

  11. Sakara Gold
    June 21, 2024

    Another day, another ex-Tory Cabinet minister announces their intention to vote Labour on July 4th. The estimable Chris Skidmore, a politician of principle who resigned his Kingswood seat in January over Sunak’s 100 new oil and gas drilling licences, has decided, correctly, that the only way to achieve net zero is via Labour’s Green Plan. Labour won his seat with a huge majority.

    Skidmore is quoted as saying “Rishi Sunak’s decision to side with the climate deniers and to deliberately politicise the energy transition, breaking the consensus of the past to seek division and polarisation, is perhaps the greatest tragedy of his premiership,”

    It would seem that millions of previously Conservative voters agree with him and will follow his lead on July 4th

    1. Original Richard
      June 21, 2024

      SG :

      I don’t doubt that Labour can achieve net zero with the right Green Plan and the communists political philosophy that the means justifies the ends, as the USSR showed with their collectivisation program in the early 1900s. Unfortunately it didn’t work, was hugely unpopular, and resulted in a huge loss of life.

      1. Original Richard
        June 21, 2024

        SG :

        Apologies, I meant of course “the ends justifies the means”!

    2. Bill B.
      June 21, 2024

      If you imagine they’re opting for Labour because they love net zero, you’re deluding yourself, SG.

    3. Lynn Atkinson
      June 21, 2024

      So looking forward to there being no electricity to charge your EV. Assuming there is enough electricity to power the web, can we expect cries of anger that ‘not enough windmills’ have been built and God is a traitor who does not want to ‘save the planet’ – (having stopped the wind)?

    4. Timaction
      June 21, 2024

      Skidmore has principles….?…… yes of course he does……. it’s just that they are very changeable. Another pretend Tory Conservative one nation Liberal. Be gone all of them.

  12. agricola
    June 21, 2024

    Damned if they do and damned if they don’t. I do however see political intent behind it. They had less hesitation in destroying a nacent Liz Truss government. If you devolve power, be it quangos, central banking, or mayoraltes and national governments you are in effect arming potential opposition. It is the EU way and has resulted in the totally ineffective government we have endured and frankly I do not expect the next forecast lot to be any different. It is why I will put my marker down for Reform.

    Their task if elected into power in 2029 will be to eradicate this socialist cancer from our governance. Assuming it does not implode from within over the next five years, and that the democratic means remain available. They are that dangerous.

  13. Sakara Gold
    June 21, 2024

    One of Sunak’s lackeys was on R4 this morning, alleging that the only way to secure the UK’s energy supply is to attempt to extract more uneconomic hydrocarbons from the N Sea.

    Wrong. The only way to secure our energy is invest in more onshore wind and especially solar, harvesting the abundant supplies of free energy with which these isles are blessed. THe xLinks Morocco project would also help

    Millions of green Conservative voters have worked this out – and the result will be a huge Labour majority after the election.

    1. Dave Andrews
      June 21, 2024

      Energy that relies on the wind blowing or the sun shining isn’t secure. Energy storage is needed, but those plans are woefully missing.

      1. Lifelogic
        June 22, 2024

        Current technology makes energy storage vastly/prohibitively expensive and very energy wasteful in general. A batter that stores 10p of electricity can cost £100 and depreciate by more than what it ever stores plus waste 20-30% of the energy in the voltage conversion, AC/DC, charging and discharging. Vast amounts of energy needed to make the batteries too.

        The sensible way is a pile of coal or a tank of gas and only generate electricity when it is needed.

        Using subsidies to build renewables which then generate electricity when it is not needed then try to store it is economic and environmental lunacy other than perhaps for a few small off grid special situations.

    2. agricola
      June 21, 2024

      The result will be an energy desert. When there is a shotage of wind and sun you currently need gas and oil until such time as atomic energy comes on side. You have the Supreme Court on side, all too eager to resurect EU law to block the extraction of oil in Surrey at the behest of JSO. The result of weak incoherent government.

      1. Dave Andrews
        June 21, 2024

        If you have nuclear power, you don’t need wind or solar at all.

        1. Lifelogic
          June 22, 2024

          The grid can take a bit and it can be cheaper than nuclear but above about 30% renewables it creates large storage or back up, grid stability issues. Use coal, gas, oil, get fracking, mining and drilling and lots of R&D into practical fusion, better batteries and better nuclear for the medium term.

          MPs cannot change the laws of physics or the economic of energy much – even if they think they can.

    3. Lynn Atkinson
      June 21, 2024

      😂🤣you can be sure that few ‘conservatives’ outside of the Cabinet are Green. Even fewer will vote Labour – I could well be a rarity, but I assure you that should I vote Labour it will NOT be in support of their idiot policies.

      It will be to punish the ‘grown ups’ who should have been fracking and pumping oil and gas for all they were worth for the last 14 years. Instead we have buried thousands of un-recyclable windmill blades under good earth, which may now be unfit for farming, and thus the call to ‘rewild’.

      Well I can tell you I am wild! Flipping furious in fact.

    4. Hat man
      June 21, 2024

      If they’re ‘green’ meaning immature and with no experience of the world, Sakara, you could be right.

  14. Paul
    June 21, 2024

    If you want a free and sustainable economy get rid of central banks. Any organisation that controls your money and charges you to use it is never going to stay out of politics because it owns politics.

  15. Ralph Corderoy
    June 21, 2024

    I think Farage and Tice may be fans of this blog.

    ‘Critical reforms needed in the first 100 days:
    ‘Bank of England must stop paying interest to commercial banks on QE reserves
    ‘This approach would save around £35 billion per year and has been endorsed by senior figures at the Financial Times, New Economics Foundation, and IFS, as well as two former Deputy Governors of the Bank of England.’ — Reform’s Contract, https://assets.nationbuilder.com/reformuk/pages/253/attachments/original/1718625371/Reform_UK_Our_Contract_with_You.pdf

  16. Javelin
    June 21, 2024

    The reality is there is no such thing as independence. The BofE votes with their personal best interests.

    That is why we have a thing called democracy.

    If I was the democratically elected Chancellor I would go and see the Committee and be filmed publicly shaking their hands and smiling and having a laugh for the six o’clock news. Then I would go onto Twitter that evening and publicly sack them and the Governor and take away their independence and criticise them harshly.

    You have to earn respect.

    1. Ian B
      June 21, 2024

      @Javelin – of sorts. Independence? but with all decisions in all situations directly effecting everyone’s daily life, the all of us as the Taxpayer paying directly and indirectly for all their mistakes. They deliberately without any real or logical reason sell bonds at a loss and the taxpayer has to pay to cover that loss. Those that get to pick up these discounted bonds, they(who ever they are) get to make a taxpayer subsidised profit!

    2. Lynn Atkinson
      June 21, 2024

      ‘Strategic ambiguity’ the Macron strategy.

  17. Rod Evans
    June 21, 2024

    Sir John, the Tory Party is facing a true existential threat due to Sunak’s incompetence and you are trying to present the BoE’s incompetence as the reason for our troubles?
    A couple of points if I may.
    1. Most people entering the voting booths have zero understanding about bonds, they have zero awareness about quantum mechanics too but that does not make them unimportant, it simply makes them unaware about matters they think do not concern them.
    2. The issues the public are aware of and that do concern them seem to be avoided. Those areas are high taxation, inflation driven high living costs, high energy prices caused by Net Zero policies introduced by the Tory party, and lastly the collapse of our infrastructure and failure, make that complete failure of our public sector.
    Those are the issues that will determine why the Tory vote will be dire come July4th, I could mention immigration but it is so out of control most people have decided to forget about it…just like the political class I guess.

    Reply I am not standing in this election and no longer have any formal role in the Conservative party. I am an independent commentator running this blog.

    1. Richard1
      June 21, 2024

      Yes I’m afraid it’s not going to wash to blame the BoE. Of course they were un-cooperative with Truss, perhaps they even tried to sabotage her attempt to implement free market conservatism. But she fell flat on her face, couldn’t explain herself, panicked at the first sound of gunfire and should and could have foreseen what would happen and prepared the ground for it. Thatcher in the 80s prepared very carefully before implementing reforms, she knew the extent of the resistance.

      So you’re wrong to blame Sunak. The day Boris left we were -5% in the polls (remarkably considering his failings and failures). Sunak was very popular at the time. Had he not truss been chosen we would surely not be in anything like the predicament we now are. Irritating as it may be to say it, some of us pointed this out at the time.

    2. Rod Evans
      June 21, 2024

      Thank you Sir John, we get that. An old colleague of yours, let us call him ‘the butcher’, I am sure you know who that is, would welcome you to join us for a pie and a pint at his constituency if you are interested.
      We could discuss what needs to be done to return UK politics to the sane centre ground it once held.

      1. Lynn Atkinson
        June 21, 2024

        Gill – good idea.

  18. J+M
    June 21, 2024

    The reason that the media does not consider the bond selling issue is that a) they think we will not understand it and b) it does not play to their chosen narrative about the government.

    1. Ian B
      June 21, 2024

      @J+M – would it be a stretch to consider that they are involved in picking these taxpayer funded heavily discounted bonds? Clearly someone is.

  19. Sakara Gold
    June 21, 2024

    The jokers running the losing CCHQ election campaign persist in their “project fear” strategy. Making wild allegations on Labour’s tax plans, net zero, VAT rises, savings, badger culling etc etc is having no effect on the polling – except to widen the gap

    As far as I can determine, a “project fear” strategy has never succeeded in any of the referenda or elections where it has been applied. The people in charge of the campaign have run out of ideas and should be encouraged to seek alternative career options

    1. Richard1
      June 21, 2024

      It worked well in the Scottish referendum.

      These warnings about a Labour govt are entirely justified. All Labour govts put up taxes. Their guiding ideology is to increase the size and scope of the state and to feather the nests of the public sector unions, and these days the blob. People should indeed be warned.

    2. Dave Andrews
      June 21, 2024

      Project Fear worked for the Scottish referendum on independence.

      1. Lynn Atkinson
        June 21, 2024

        No it didn’t, sanity prevailed. Lies were observed and discounted. Scotland is related to England – almost every family has relations south of the border.
        The SNPs project fear failed.
        The British are hard to scare, only the Covid Scam worked for a while on 2/3rd.

        1. Dave Andrews
          June 21, 2024

          I don’t dispute any of what you see, but my observation was that the Better Together campaign ran along Project Fear lines.
          I really value the Scots’ participation in our Union, but the programme of saying that the Scots were incapable of running their country themselves is downright insulting.

          1. Lynn Atkinson
            June 22, 2024

            But accurate. The SNP have never offering independence, they proposed subservience to the EU including the adoption of the Euro.
            The ‘green’ SNP had to support oil and gas recovery – as they do now.
            The contradictions did not fool the Scots. The lies that Scotland was threatened from Westminster, where Scots hold high profile jobs in every Government was the ‘project fear’ that failed.

    3. a-tracy
      June 21, 2024

      SK, we will see how wild those allegations are within a year.

      I don’t think its wild to read think tank advisors to Labour and their wishes regarding dropping the VAT threshold. Dealing with small business people who they say owe at least £6bn in underdeclared turnover. It will be interesting after they have said wild allegations about taking away the cap on employee’s NI and putting in new council tax bands go ahead. If they don’t, their unions won’t be happy because the people I’m speaking to in the public sector are expecting a big over-inflation pay settlements (real inflation they’ve done so much talking about).

  20. majorfrustration
    June 21, 2024

    You ask why? Well perhaps the media just do not understand what the Bank is up to.

  21. Ian B
    June 21, 2024

    Sir John – are they getting it wrong? Since they became a Political entity with an unelected and seemingly unaccountable Leader, they have shown their hard-left credentials of the Socialists WEF Organizations of the World. They give the Media their Political take and direction that is not to support the Country but is simply anti Conservative. The only reason this Conservative Government has chosen ‘not’ to manage the BoE as is their duty, is because they have the same inclination of the UK becoming a one party Socialist State.

    All Conservatives have been attacked from within.

    With Rachael Reeves in charge we will see a whole different dynamic the BoE will be working for and supporting Her.
    One thing we do know is the BoE is not Independent

    1. Lynn Atkinson
      June 22, 2024

      Oh the BOE is independent, it displays its independence by following its own political line free from intervention. It has asserted the Common Purpose baseline of ‘taking power beyond it’s remit’ as JR pointed out, it has taken power over fiscal policy. Only Hunt seem oblivious.
      That’s why Banker Sunak will be sacked personally, well, one of the reasons.

  22. Roy Grainger
    June 21, 2024

    The BoE were never going to cut rates first, they were slow to react on the way up and are slow to react on the way down, there’s not really anything “political” about that. So why did the Conservatives call an election in July rather than waiting till autumn when the rate cuts will have started ? It’s their own fault, no point blaming the BoE for the election date. Maybe the Conservatives can get a few bets on when they think the first rate cut will be ?

    1. Timaction
      June 21, 2024

      Because Rwanda won’t fly and the Snake knows it.

  23. glen cullen
    June 21, 2024

    The media controlling the topic, yesterday it was interest rates, today betting on election date ….never bank bond sell-off or the EU election results ….the greens & alliance only got 51 out of 720 seats ….where’s the net-zero mandate, people here and across Europe just aren’t supporting green candidates nor their policies

  24. glen cullen
    June 21, 2024

    Why has the BoE got an ESG and Climate Change policy
    https://www.bankofengland.co.uk/climate-change
    ‘Woke capitalism’ funds COLLAPSED by $13B last year – investors fled trendy ‘ESG’ investments over low returns, greenwashing and back-door leftist agenda’
    https://www.dailymail.co.uk/news/article-13056551/Woke-capitalism-funds-COLLAPSED-13B-year-investors-ESG-greenwashing-leftist.html

    1. John Waugh
      June 21, 2024

      Got a letter this June-
      “The fund manager will no longer incorporate ESG factors in their investment decisions…….,,Instead ,the fund will solely focus on …….long term capital growth .”

  25. Everhopeful
    June 21, 2024

    Since Truss the Bank of England and its acolytes have realised the power they have.
    They can get rid of Prime Ministers they do not like.
    ( Did they actually deliver a death blow to the tories?)
    Watch the US do the same to Trump…assuming elections go ahead!
    Finance has been weaponised.

    1. Everhopeful
      June 21, 2024

      I think they call it “Zero Sovereignty”

      1. Ian B
        June 21, 2024

        @Everhopeful – you reach a stage when all the conspiracies converge to become the truth

        1. glen cullen
          June 21, 2024

          Sun Tzu — ‘If you wait by the river long enough, the bodies of your enemies will float by.’

    2. glen cullen
      June 21, 2024

      I wonder if the polls would be so bad if Liz was still PM

      1. Everhopeful
        June 21, 2024

        I do doubt it.
        Her “disaster” was totally fabricated?

        1. glen cullen
          June 21, 2024

          Agree ….the only Tory PM voted into office by the tory membership

        2. Lifelogic
          June 22, 2024

          Indeed she was just the last straw that set off the economic disaster built by Sunak as Chancellor.

  26. Mike Wilson
    June 21, 2024

    When I was asked to comment yesterday on the lack of rate cut the media would not consider the far more important Bank decision to keep on selling bonds. Why?

    Because the half-wits in the media:
    1) Do not understand the bond market
    2) Regard the Bank of England as a divine force that cannot be wrong

    1. Mike Wilson
      June 21, 2024

      3) Regard anyone who questions the Bank of England as a heretic or nutter.

  27. Original Richard
    June 21, 2024

    Of course the BoE “insists on getting it wrong” as fifth column communists they’re determined to destroy our economy and wealth. They use false modelling just as the political wing of the UN/IPCC/BBC uses theirs to frighten everyone that we now have “global boiling” (UN Sec Gen 27/07/2023).

    Labour have announced that their government will make fighting global “heating” a priority for the Bank of England so our energy security and finances will only get worse. Of course Labour can decarbonise our electricity by 2030 (or any date in between by simply cutting off all our hydrocarbon fuelled electricity plants when they wish) and at the same time cut our energy bills by £300 simply because we will use less energy as a result of rolling blackouts.

    Labour haven’t promised that electricity will always be “available at the flick of a switch” (P19 of the Net Zero Strategy).

  28. DOM
    June 21, 2024

    It is official, Government debt is now 100% of UK GDP. This sorry state of affairs is a direct consequence of the uniparty’s loyalty to enslavement Socialism. Make the plebs dependent, turn them into slaves and control and chastise them like they were children

    Authoritarianism is extremely expensive to finance and maintain and it’s gonna get worse under Starmer as he plots to transfer even more power away from Parliament to his unelected and unaccountable buddies in Quango world, in the politicised judiciary, captured institutions and fascist left activists

    1. glen cullen
      June 21, 2024

      +1

  29. forthurst
    June 21, 2024

    The Debt Management Office sells gilts to finance government overspending and then the Bank of England buys
    them back to control inflation and then sells them at a loss to prevent deflation. All rather pointless when the Bank has the tool of the discount rate to control supply and demand. We also have a floating exchange rate so the pound no longer needs to be defended from foreign spivs. If we had a balance of payments surplus there might be a reason for the BoE to accumulate real assets not ones that can be printed by the government.

  30. Derek
    June 21, 2024

    In no one in an official position to tell the BoE they are not helping OUR country and have made a mess of their mandate and subsequently, our economy, continually for the past decade?

    1. glen cullen
      June 21, 2024

      I think they look towards the IMF & UN ….and not Britain (NI is looked after by the EU and their central bank)

  31. Lynn Atkinson
    June 21, 2024

    The Labour Party is in a few jams. Labour supporters have long been officially richer than Conservatives. So proposing to ‘’tax the rich’ is a bit of a double edged sword.
    Labour is just as much of a coalition as are the Conservatives, and a big majority is always blessed difficult to control – opposing groups from within the party itself providing it’s own opposition.
    This is a government taking over a country at war. Sunak’s proposals regarding compulsion and conscription went down like a lead balloon here in the north – which produces a huge percentage of the squaddies to the point where Holden has blown the whistle on the whole north!
    I don’t believe Labour understands JR’s political economic analysis and solutions. like the MSM, they just ignore them, however they NEED them just as the Tory Government needed them. You can see the result for the Sunak government and Labour will plough the same furrow.
    Without a sound economy, there are just soooo many problems without solutions.

    1. Everhopeful
      June 21, 2024

      They’ve imported a whole army ( and more) though?

  32. Peter D Gardner
    June 22, 2024

    It may come as a shock to Sir John, given his long history in finance and economics, one way or another, but most people haven’t a clue about bonds, what they are or how they work, who buys them etc. The obscure language doesn’t aid understanding. For example, what do most people think when they see a statement such as ‘Bond yields are up”. Sounds good, the bond is earning higher interest than before. Er no, what has happened is that its value has gone down, its yield was fixed on issue. It’s upside down language. The public generally do not understand.
    It would help if politicians who do understand explained in simple lay language without jargon. Yes I know, they’ll be accused of talking down to people, treating them like idiots, etc etc. But the truth is most people know less than they like to think they know.

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