Andrew Bailey has missed a vocation in journalism. The Governor of the Bank of England has all the right catastrophist instincts, and knows how to generate terrifying headlines.
The US Federal Reserve and European Central Bank (ECB) strive to put a gloss on hellish events, careful not to talk their economies into deeper trouble, and are certainly less willing to acknowledge a spiralling rise in the stagflation misery index.
The contrast is striking because it is the American economy that contracted over the first two quarters, not the British economy. It is in the US where construction is in freefall, and where S&P Global’s index for services has fallen to deep recession levels, all amid inflation of 9.1pc.
It is the eurozone PMI index of economic health that has just fallen through the boom-bust line, not the UK index, which has outperformed in six of the last seven months. As for inflation, it is 8.9pc in the eurozone, and 9.6pc in the EU. It is 9.4pc in the UK.
Inflation is much the same across the Atlantic economy, though less in countries that defy the International Monetary Fund and suppress the energy price signal with blanket subsidies. Yet Governor Bailey alone has the taste for Gothic melodrama.
The Bank’s candour would be refreshing, were it plausible. But the Monetary Policy Report is a strange jumble of macroeconomic contradictions.
“They have gone over the top on this. I don’t think serious economic analysts believe the Bank of England’s forecasts any more,” said Professor Douglas McWilliams, head of the Centre for Economic and Business Research.
“The inflation figures are much too high. [The] Bank was completely wrong when they said there was no problem of inflation building up, so why should we believe them now in the other direction when the money supply is collapsing?” he said.
“These inflation forecasts are poppycock,” said Albert Edwards, global strategist at Societe Generale.
“Industrial and agricultural commodities are already 30pc off their peak, oil is down, and global liquidity is being withdrawn. We’re heading for zero-inflation within twelve months.”
Mr Edwards said the Bank is trying to conjure an argument to justify more tightening because it feels it has to do something.
“By next year people will be in a panic about deflation, and we’ll be going back to sub-zero rates. Bailey can talk as tough as he wants but everybody has a plan until they are punched in the face,” he said.