Joe Weisenthal

You can't do anything.

Suddenly the price of electricity goes up everywhere and we call that a supply side shock and it's not great when that happens.

And then there is also the sort of like core productive capacity of a country and how productive industries are and what type of investment is there and so forth.

Even setting aside the shocks,

The trend seems to be negative in the UK in terms of business investment.

You hear about the last steel mill or whatever that's closing, or I read something recently, the UK might be importing salt for the first time or whatever.

In your, whether it's formerly annual, but now regular studies of the supply side of the UK economy, do you have a diagnosis or do you have an assessment about what is driving this sort of long-term deterioration?

Yeah, sustained growth.

Can't reverse Brexit.

I know in the U.S., there is an entire art to asking a monetary policy setter a question about fiscal policy because you have to do it very delicately.

Otherwise, they might faint over in their chair if they're presented with something outside their remit.

I don't know what exactly the norms are here about how we're supposed to phrase such questions to elicit some sort of answer.

But with all that out of the way...

When you think about upward pressure on inflation and why you're so concerned about inflation, and we've talked about energy and all that, how much does the seeming inability of government after government to engage in fiscal consolidation, how much is that a factor when you think about the future trajectory of inflation?

I've done all the thought clearing for you.

We stipulate that it doesn't seem like there is any real impulse at fiscal consolidation or capacity right now.

So what does that mean?

But so just to push further, some of these fiscal choices, like the inviolability of, say, the triple lock, which, again, I'm not asking you whether these are good or bad policies, et cetera.

But are these contributors to the persistence of upside inflation risks?

Well, let me ask you a mechanical question about the bond market, which is, are the coupon payments, as we see yields rise, and this is a question for all developing economies, and it's certainly at least a little bit of an anxiety in the US as well, as we see those coupon payments rise, are we anywhere near where those interest payments themselves are creating an inflationary impulse in the UK, which economists would call fiscal dominance?