Quite clearly the financial authorities in the UK and US haven’t got a clue. Both the Governor of the Bank of England, Lord Mervyn King, and the Secretary of the US Treasury, Henry Paulson, are useless at sorting out the financial mess.
Both King and Paulson changed tack last week citing ‘circumstances have changed’. King slashed interest rates after saying, only a couple of months ago, that UK inflation at 5 per cent was the main danger, and interest rates needed to be kept high to restrain it.
Paulson changed tack last week by saying that the $700 billion bailout voted by the US Congress would be spent buying banks’ shares and not, as originally intended, buying dodgy mortgages.
Both King and Paulson know that the financial situation hasn’t changed in the last few weeks. This mess has been brewing for several years – on their watches.
So, the excuse they gave that circumstances have changed is bollox. What’s changed is their minds.
And who changed those?
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