Look out for lesbians
THE Bank got its charter from William III because he had a war on his hands and needed to borrow money, as our rulers often do. The loan was a part of the deal. From then on the Bank looked after the national debt and raised more money for successive governments than was always good for them — until 1997, when the incoming Chancellor fired it. He detected a conflict of interest between setting rates and managing the market, so he established a Treasury agency, with an office in the City, to do the work for him. How well this will work we shall see when he next needs to borrow money. He then took the work of supervising banks away, and shipped all the supervisors down the river to the great new regulatorium in Docklands. There the Financial Services Authority monitors the health of individual banks, while the Bank of England is respon- sible for the health of the banking system. This division of responsibility is trouble on its way to happen. Between the two ends of the Docklands Light Railway some rocky bank is sure to slip through the rails. Now the Chancellor is selling off the gold in the Bank's vaults. Next he will name its new directors, who may not know much about banking but will speak for a wider range of interests, I have been told to look out for one-legged lesbians.
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