Letters: The role of the Bank of England in the plummeting value of the pound

Yesterday Andrew Bailey, the Governor of the Bank of England, ruled out an emergency rate rise following a rout in the pound
Yesterday Andrew Bailey, the Governor of the Bank of England, ruled out an emergency rate rise following a rout in the pound

SIR – I find it hard to believe that the fall in sterling is purely the result of the Chancellor’s mini-Budget last Friday.

The tax cuts he announced had been widely trailed, so should have been factored into the price of the pound; the cause was more likely to have been the smaller than expected rise in interest rates, together with the Bank of England announcing that it was intending to sell off its gilt positions.

There is, of course, a possibility that the traders had been sitting around ignoring the news, but if this is true then you should be selling bank shares rather than sterling.

Philip Samengo-Turner
Cirencester, Gloucestershire

SIR – John Major and Norman Lamont had two years in office before Black Wednesday in 1992 destroyed the Conservatives’ reputation for economic competence. Liz Truss and Kwasi Kwarteng have managed it in less than three weeks.

Christopher Clayton
Waverton, Cheshire

SIR – The emergence of a proper Conservative government after 30 years means I am able to vote for the party again.

All we need now is the emergence of a proper Bank of England – one which will normalise interest rates to control inflation, doesn’t view printing money as a duty, and eschews jiggery-pokery such as manipulation of the lending market with its Term Funding Scheme.

David Myers
Retford, Nottinghamshire

SIR – Following the cut to marginal tax rates for high earners, the issue is whether or not these people will spend their new net income within the British economy (as opposed to saving it or spending it on imports, including foreign holidays).

Your Leading Article (“Critics of the Budget are missing the point”, September 25) refers to an article from the 2018 Quarterly Journal of Economics, but its conclusions are, critically, short-run and based on US data. Beyond the short run, Kwasi Kwarteng’s tax-cutting and high-borrowing mini-Budget will have two immediate consequences: a devalued currency and an increase in interest rates.

The former will immediately generate domestic inflation in Britain, especially affecting energy prices, and the latter will have a negative impact on every household with debts (including, of course, those with mortgages).

There are many ways to promote growth. Offering tax handouts to the well off is very Conservative but to fund those cuts by unsustainable government borrowing is most un-Conservative. Whatever happened to fiscal responsibility?

Adrian Darnell

SIR – The question now is not whether governments can tax their way to prosperity, but whether they can borrow their way to solvency.

Roger Ward
London N1

Labour’s vacuum

SIR – Labour currently opposes some Conservative tax cuts, even though recently its policy was to oppose Conservative tax increases.

The public won’t be fooled by the intellectual vacuum on the Opposition front benches.

David Miller
Chigwell, Essex

SIR – The Left wing of the Labour Party is calling for more nationalisation. What that really means is more unionisation. It wants to go back to the past, and give more power to the union bosses, not the people.

John Armstrong
Peacehaven, East Sussex

SIR – It says a lot about the Labour conference that the party had to hand out the words of the national anthem (report, September 26).

Bill Todd
Whitton, Middlesex

Russia’s nuclear threat

SIR – I was interested to read Colonel Hamish de Bretton-Gordon’s letter on the condition of Russia’s nuclear arsenal (September 25).

My grandfather was in Ukraine between 1910 and 1920. He spoke fluent Russian and maintained business contacts with old friends in the Caucasus until he retired in the mid-1970s. He visited Russian coastal cities until the late 1960s.

At the height of the Cold War, when we were all worried about nuclear bombs, he told me that we had no need to worry about the Russian military threat as “they would not fight”. He said that they were starving and poorly paid and equipped. His information came from sea captains and sailors in the port cities who spoke freely to him.

Given the morale and incompetent leadership of the Russian military, as has been revealed in Ukraine, and the poor condition and maintenance of their equipment, I think this advice applies today. Why are we worried about Vladimir Putin’s nuclear arsenal? Will it work or will the missiles go off course or fail to launch, posing a bigger risk to Russia than to the West?

Michael Blackmore
Saint Ferme, Gironde, France

The sloe lane

SIR – If Simon Warde (Letters, September 26) is finding a shortage of sloes in Bognor Regis, he should try the East Midlands. Here we have an abundance, far more than I have seen in recent years. My sloe gin is already well on the way.

Mark J Routen
Watford, Hertfordshire

SIR – There are fewer sloes around at the moment because most farmers flail the hedgerows to within an inch of their lives. There are also fewer British birds and small mammals that depend on the hedgerows’ bounty for their winter survival.

John A Tallis
Husbands Bosworth, Leicestershire

SIR – We’ve had a bumper year for sloes, along with blackberries and the honey harvest from my bees. No crisis here, so let’s all cheer up a bit.

Paul Spencer
Thame, Oxfordshire

SIR – There is an ample sufficiency up here in rural Cumbria. Northern sloe gin lovers can rest easy.

Sue Leach
Orton, Cumbria

SIR – We have no sloes, and figs that will never ripen. But there are more sweet chestnuts than ever.

Carol Goodfellow
Walton-on-Thames, Surrey

Futile GP targets

SIR – Is Archie Douglas (Letters, September 26) being serious when he suggests that the two-week wait for a GP appointment should be a “target” that the Health Secretary can reduce each time it is reached? When has any target set by the NHS ever been met?

John Newbury
Warminster, Wiltshire

SIR – Regarding NHS management (Letters, September 26), of course there must be expertise in procurement, HR, IT and so on. But I would argue that diversity consultants who insist that midwives call mothers “birthing parents”, and breastfeeding “chestfeeding”, do not have a place.

R G Hopgood
Kirby-le-Soken, Essex

Rural suburbia

SIR – I was interested to read Hattie Garlick’s list of 11 ways in which the middle classes have ruined the countryside (Features, September 21).

However, the one at the top of my list is the way that some people moving to a rural setting soon start making proposals to turn their new surroundings into suburbia. Examples include requesting more and stronger street lighting, painting more yellow lines along the roads, pruning or removing trees that block their view, and close-mowing roadside verges. If that’s what they want, why move?

Professor Clive A Stace
Middlewood Green, Suffolk

Of wits and wickets

SIR – It’s a pity that Stephen Fry is in favour of abolishing the annual Eton vs Harrow cricket match at Lord’s (report, September 26). History and tradition are a great part of this game and should not be lightly cast aside. Cricket has inspired literature in several classic forms, from whodunits to short stories to verse. After Eton had beaten Harrow in 1805, an Eton boy produced the a bombastic little quatrain, which, as I recall, went as follows:

Ye silly boys of Harrow School
Of cricket you’ve no knowledge.
It wasn’t cricket but the fool
Ye played with Eton College.

But Harrow possessed a boy well suited to answering insults in verse – no less a one than Lord Byron, to whom this swift riposte is attributed:

If, as you say, we played the fool,
No wonder we were beaten:
For at that game no other school
Can e’er compare with Eton.

Hugo Summerson
London SW20

Puzzled by the size of antique wine glasses

Yellow Dahlias (1925) by the French intimist painter Henri Le Sidaner (1862-1939) - bridgeman
Yellow Dahlias (1925) by the French intimist painter Henri Le Sidaner (1862-1939) - bridgeman

SIR – Recently I was browsing in an antique market and found a stall displaying a set of wine glasses with long green stems, very similar to a set I inherited a few years ago.

They also caught the eye of two women in their thirties, who seemed a little puzzled.

They said to the stall holder: “They’re pretty, but they’ve got such small bowls. What are they used for?” She replied: “They’re wine glasses. In the olden days people drank wine from small glasses.”

Mine are still in use. I walked off feeling like an antique myself.

Sally Gibbons
London SW19

Danger for Tory MPs in fracking constituencies

SIR – There is nothing Luddite – as Jacob Rees-Mogg, the Business Secretary, put it (Comment, September 23) – about objecting to fracking in old coal mining areas with fractured seams underneath.

The inevitable leaking of highly toxic waste fluids, which poison local water supplies with benzene, xylene and methanol derivatives, is a major hazard, as is methane exudation, which is more toxic to the climate than the gas which comes from coal extraction.

We grow over 70,000 Christmas trees, maintain a site of special scientific interest – an ancient meadow – for Natural England and are major beekeepers and honey producers. We do all this within a couple of miles of a proposed fracking site.

Lee Rowley MP achieved a victory at the 2017 general election on an anti-fracking ticket, after Natascha Engel, the former Labour MP for North East Derbyshire, seemed to have no interest in worried locals living less than a mile from this site.

Liz Truss should rethink her policy on fracking. The northern Red Wall seats could change her electoral fortunes at a stroke.

Gloria Havenhand
Troway, Derbyshire

SIR – Last week the Chancellor confirmed a price cap on energy bills for households on existing tariffs.

Shell Energy has just advised me that my tariff is being changed to an “Energy Price Guarantee” tariff, which is 40 per cent more expensive than my current Flexible 7 tariff.

I have not agreed to change my tariff – it has been imposed on me by Shell and will cost me about £1,500 more a year.

How can the Government claim to have capped energy prices when Shell resorts to dirty tricks to work around the price cap by transferring customers on to a newly invented tariff? Is anybody in the Government monitoring or watching?

M Newman
Coventry, Warwickshire

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