Central-Bank

The gilt market is mendicant, not master. Why we must stop our devotion to an empty throne and remove this phantom veto on democracy.

There is no risk that interest rates on UK government debt will reach crippling levels. Interest rates are policy variables. Paying interest is a political choice. Betteridge’s law of headlines applies.

The Asset Purchase Facility has landed HM Treasury with a ~£90 billion bill over the next two year. This paper lays out an approach that requires no further vote funding from Parliament, no additional debt interest payments, and restores “postive cash flow” from the APF for the remainder of this Parliament.

The 2020s appear to be a never-ending parade of global groupthink. The Russian Oil Price Cap is yet another stupid and self-destructive idea that should have been suffocated at birth. It cannot possibly achieve what its supporters claim, and it represents emotional value signalling from the Big Hug Club rather than any semblance of rational thought.

Once intra-government transactions are eliminated, QE represents an exchange of gilts (liabilities of the National Loans Fund) for central bank reserves (liabilities of the Bank of England)

The public debt markets add less value to national prosperity than their opportunity costs. A proper cost-benefit analysis would conclude that the market should be terminated.

How the new payment process for gas in Russia will work, including how it is settled at the Moscow Exchange, all of which leads to some interesting observations

Journalists really should take some time to learn how correspondent banking works

In all international transactions they consumer pays with the currency they have and the producer gets the currency they want to hold. So why the big fuss over Russia’s requirement to receive Roubles?

Russia has easily countered the attempts at financial sanctions, resulting in some interesting outcomes that further confirm the view taken by Modern Monetary Theory