Bank of england

I thought it obvious that Mark Carney’s trip to Scotland yesterday was a bad day for Alex Salmond and the Scottish nationalists. Sure, the governor of the Bank of England said, a currency union between Scotland the the rump UK could happen and be made to work but it would be fraught with difficulty and sacrifice too. Do you really want to do that? How lucky do you feel? Carney, being a Canadian and therefore a man crippled by politeness, did not add “punk”. In response the SNP were reduced to pushing a meaningless poll which found 70% of Britons favouring a currency union after independence. That is, 70% of

Mark Carney’s speech to the Economics Club of New York yesterday made clear that very low interest rates now ‘put a premium on macroprudential policies’. Translation: he’s not going to hike interest rates soon, but he wants us to know that there are other levers he can pull to keep the UK economy on track. What are those levers? First, Funding for Lending. Two weeks ago Mark Carney announced that the scheme – which offers banks cheap funding if they increase lending to the real economy – would no longer be available for mortgage lending. It will only be open for loans to companies. That’s a lot more than just

In 1925 Winston Churchill, then Chancellor of the Exchequer, famously declared that he wished to see ‘finance less proud and industry more content’. In the light of the financial crisis, much the same refrain has been heard from policymakers and politicians over the past five years. How are we to avoid repeating the mistakes of the past? And how might the financial sector reinvent itself for the future? I wish to argue there are grounds for optimism. Out of the ashes of the financial crisis a new type of banking is emerging. Old business models are being rewritten and new entrants are driving change. Indeed, it’s possible that the financial

Vodafone, which has just collected an £84 billion windfall from the sale of its 45 per cent stake in Verizon Wireless of the US, is either a hero or an anti-hero of British capitalism, according to taste. To me, the world’s second-largest mobile phone business is heroic because it achieved that position from a standing start just 30 years ago, when poker-playing Ernie Harrison, chief executive of a military radio manufacturer called Racal, bet everything he had on the future of mobile telephony. At a time when other electronics companies thought it too uncertain a prospect to bother trying to compete against the monopolistic British Telecom, Harrison and his colleague

Mark Carney’s charm offensive continues. I hear that the new governor of the Bank of England was laying it on thick last week when he bumped into Faisal Islam, Channel Four’s Economics Editor, after he gave his first public speech. ‘Don’t you have a book out?’ The Canadian smoothy asked Faisal, who offered to send him a copy. ‘Well I’ve got an idea, how about I buy one?’ The charmer cooed. ‘I’d be honoured, governor.’ Faisal beamed. ‘Hey,’ replied the governor, ‘I said I’d buy it; I didn’t say I’d read it!’ Faisal tells me that Carney ‘might have turned down Osborne’s advances if he’d read the full gory detail

Of all the qualities one hopes for in a Bank of England Governor – a brilliant mind, the courage to tell politicians they are wrong, supernatural foresight – coolness is not among them. I don’t mean coolness under pressure; clearly that helps. I mean the ability to project a hip image. The new Bank of England Governor may well be a terrific economist. More than that, however, he is a first-rate media brand. He’s more Blair than Blair. Hell, he’s more Blair than Cameron. Last weekend, he went to the Wilderness Festival, aka ‘poshstock’, and the press seems to have taken that as proof that things are going to get

Mark Carney made his mark this morning. Moments ago, he opened his inflation report and issued his ‘forward guidance’, which is designed to make the markets aware of his long-term plans for interest rates. This is important because, although there are signs of life in the British economy (and Carney was cautious about them), inflation remains above the Bank of England’s target, the base interest rate remains rooted to the floor and unemployment remains high at around 8 per cent. There is also the question of Britain’s mounting debts, the answer to which will largely depend on how the bond markets react to this and other announcements. And then there is

I’ve been in the pulpit again, this time to salute the centenary of the death of Charles Norris Gray, a formidable Victorian vicar of my Yorkshire town of Helmsley. Gray was a social activist with strong opinions on everything from sanitation to election candidates, and he did a great deal of good for his parish — so I’m not averse to the idea of churchmen intervening in worldly affairs, and I think Archbishop Justin Welby was right to highlight the parasitical nature of ‘payday lenders’ such as Wonga, even if he was subsequently embarrassed to discover that the Church of England was an indirect investor in it. But by his

Marc Rich, the godfather of global commodity trading who died last week, ‘deserves credit as one of the greatest creators and sharers of wealth in business history’, wrote James Breiding in the Financial Times in a counterblast to obituarists who had painted the secretive Swiss-based billionaire and former fugitive from US justice as ‘a flamboyant, tax-evading crook’. Bill Clinton certainly saw the better angel in Rich’s nature, granting a presidential pardon for his embargo-busting dealings with Iran against all precedent and advice. But leaving aside the unpatriotic oil trades and the unpaid taxes (not to mention the former Mrs Rich’s timely donation to the Clinton Library), is Breiding right to

What the Mark Carney era may offer is a little bit more predictability on monetary policy. Under Mervyn King the main guidance came from the Bank’s quarterly Inflation Report press conferences, MPC minutes, and speeches by committee members. Under the Bank’s new remit, set by the Chancellor in the March budget, it’s likely that Carney, like Bernanke, will seek to link interest rates and monetary policy directly to growth and jobs targets There will be subtle changes but no one, as economists at HSBC have noted, is expecting ‘shock and awe’. The big question for Carney is which indicators to use as targets. The runners are unemployment (as in the US), real

Jane Austen is a ‘contingency character’, we have just learnt. In his last appearance as Governor of the Bank of England before the Treasury Select Committee of the House of Commons, Sir Mervyn King explained that the great novelist rather slightingly so described stands in reserve to feature on any of our bank notes if too many people succeed in counterfeiting the current occupants. She is also in the running for the ten-pound note when Charles Darwin relinquishes it. This is a hot issue, because the notes do not feature enough women, we are told — despite the fact that since 1952, 100 per cent of them have featured a woman

On my way to chair a town meeting, I was chuckling over Phillip Warner’s cartoon last week headed ‘Mary Portas reinvigorates the High Street’. First, TV’s sharp-tongued queen of retail holds forth in front of a row of abandoned shops; then townsfolk dance in the street at the news that she has ‘buggered off in a taxi’. Call me an old cynic, but I think turning stars into tsars is a sign of Downing Street desperation: witness Alan Sugar’s lame stint as ‘enterprise champion’ in the dying days of Gordon Brown, and wince at James Caan from Dragon’s Den tackling social mobility. What I heard from the people of my