What are the technical factors the Bank of England has described in the gilt market. Simplified explanation (with HT @tobynangle & @bondvigilantes).

It involves liability driven investments - trying to match long term payment requirements with long dated assets. There are a range of financial products or financial requirements (like getting too old to work) that require managing money in order to generate cash flow over a long period.

Think mortgages, institutional investors (eg universities) and pension funds and asset managers.

It’s hard to overstate the horror of foreign officials at what the British government’s actions mean for the standing of its assets and institutions.

Several G7 officials told me the Govt risks squandering the “extraordinary luxury” of int’l trust and respect for BoE & OBR. UK institutions are seen as setting really high standards for their work and sharing of best practices with other countries, G7 officials said.

The helped maintain investor confidence during the turmoil of Brexit: “It was amazing that Sterling only lost 20pc,” one said.

A couple of points as can't respond to all queries:

(1) the use of non-dom tax status is optional and doesn't depend on citizenship. The HMRC language is 'wish': gov.uk/hmrc-internal-… If you choose to use it, you do not have to detail your worldwide income, beyond the UK. (2) Without choosing to use non-dom status, or if you're an ordinary taxpayer your worldwide income is subject to tax in the UK and you must report all of it to HMRC. If the country where an asset is held has a tax treaty with the UK, the way it's handled can differ.

The @BankofEngland's chief economist Huw Pill tells markets not "focus on a specific meeting" after the mismatch in action versus expectation last month.

Adds: "we're trying to train people to think the right way" about monetary policy = medium term
#TalkingEconomics He adds that risks are now double sided for the BoE ahead of its December meeting. It doesn't want to feed inflation, but also doesn't want to crimp growth.

A "not too hot, not too cold" goldilocks path is what's needed, Pill adds.

Some crazy trade lines coming out of the US trip.

(1) we already knew US had downed tools in trade talks with U.K. It was made clear talks were on ice until the NIprotocol was working effectively/no longer a source of tension.

Made post-consent vote before any move likely. 1/x That’s December 2024. So calm down.

I saw some drafting from talks previous admin. There was a way to go EVEN THEN (several chapters still not agreed) even before Biden took office, even if a deal under Trump was considerably more likely. 2/x google.com/amp/s/www.poli…

This week we've seen how a trillion pound problem could link a pensioner in Kent to the next global financial crisis and not enough people know about it. I'll be saying unsexy words like pension and liquidity, but bear with me. This is a disaster waiting to happen... 1/thread: Pensions funds have tried to get people a good return on money amid low interest rates. In some cases they've treated asset managers like magic piggy banks: giving a tasty return but also instantly letting you withdraw cash. Spoiler: it doesn't work, that's scary 2/thread

So, now the media circus has largely moved out of town, feels like a good time for a thread on Brexit, Swindon, and just how big a hit losing Honda will be. 1/ I know the town, and I was sent to cover the story not of the wider car industry in the UK, but those of the people affected by the job losses. Many voted leave. And guess what: not a single leaver I encountered would change that vote, job loss or no. 2/

The biggest #Brexit fig you haven't heard of: £45 trillion. This is the value of a bunch of financial contracts - called derivatives. These are at risk because the EU hasn't confirmed they will be recognised after March 2019. UK has. What's a derivative contract? Well...1/thread Like all contracts it’s a legally enforceable deal. This kind is a way for a company to manage risk. They cover lots of financial areas like bonds, mortgages and currencies. They are often also called futures contracts or swaps. 2/

Thread on Trump, trade wars and midterms: Lots of people understandably interested in what the election result might mean for the escalating trade war/US protectionism. Here's what some economists/trade experts/politicos reckon 1/ Firstly, recent headline decisions on trade were made using executive powers. Trade with foreign nations is theoretically in Congress’ scope but much of that power has been ceded to the exec. Has little recourse to stop say tariffs based on national security concerns 2/