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Hello and welcome to Coffee House Shots' Spectators Daily Politics Podcast.

I'm Katie Balls, I'm joined by James Forsyff and Kate Andrews.

So, Parliament is back today, MPs are in Westminster, quasi-quartagas facing questions from his party and the opposition.

Before he heads to the IMF, James, how much pressure is the chance to render?

I mean the chance to result in more pressure because the Bank of England has intervened again this morning to try and calm the guilt's markets.

For those keeping score at home, that is the third intervention from them so far.

We have the first intervention, they intervened again on Monday, we intervened now on Tuesday.

And if they're doing this because the cost of these government guilt's is rising and a relatively rapid rate and the Bank is trying to calm the market.

Now, all of these operations that the Bank is conducting are technically meant to end on Friday.

There is, I think, deep skepticism in the city about whether the Bank will be able to end on Friday and whether or not it will have to extend.

The risk for the Bank here is that if it extends, people begin to think, well, actually the Bank is actually not to protect the financial system but to keep the cost of government borrowing artificially low.

And that runs the risk of something called fiscal dominance when people begin to think that the Bank isn't acting in the best interest of financial stability but trying to protect the central government from its own decisions.

And that will then lead to a substantial risk premium on borrowing to the UK and act as a deterrent to investment here.

I think that whatever happens though, it is quite clear that the cost of government borrowing is going to end up being substantially higher than we have been used to.

The IFS green budget that is out today and I wouldn't, it's not relaxing really, is saying that the UK government will be spending 103 billion pounds on desinterest, that is more than we spend on education.

And that is the highest as a percentage of national income since the 1940s.

And I think what we're seeing here is that if you go back and read Kate Andrews' piece on trustonomics, the whole theory behind trustonomics was twofold.

One was that tax cuts and reform were boosted economic growth rate.

And the second is that you could borrow to fund that transition and the markets would be happy to lend to you at a fairly low rate.

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