Editorial hello
I’m afraid I’m rushing to a stablecoin-themed lunch today, so the best I can do for a thought for the day is what I already shared on X this morning:
Izabella Kaminska@izakaminska
I’m 17 years or more late to this realisation. But… it dawned on me yesterday quite acutely that giving central banks a financial stability and macro prudential mandate was actually a grave error and is partly responsible for the breakdown of the entire independent central
5:22 AM · May 14, 2026 · 11.8K Views
18 Replies · 20 Reposts · 133 Likes
Izabella Kaminska@izakaminska
In that context I think the below chart from the BoE’s Catherine Mann is pretty notable. What is the signal here really?
My interpretation: post LDI the BoE acted to nip disciplinary market forces in the bud.
You can see that effect in the reduction of repo leverage in the
Izabella Kaminska @izakaminska
Those price-sensitive hedge funds have also increased their net gilt repo borrowing: (aka pledging gilts for funding...but what sort of funding is the question).
6:49 AM · May 14, 2026 · 4.97K Views
4 Replies · 5 Reposts · 27 Likes
Izabella Kaminska@izakaminska
What this means in practice is that the UK’s economic model is bounded by a very clear GBPUSD threshold.
This is because if GBP falls below that threshold the credibility of Britain’s hyper financialised economic model - powered by the collection of global rents - falls apart.
7:09 AM · May 14, 2026 · 3.82K Views
7 Replies · 10 Reposts · 35 Likes
