Liz Truss’s fate rests with the Bank of England

James Carville, an ostentatiously aggressive adviser to Bill Clinton, once said that when he died, he wanted to be reincarnated ‘as the bond market – you can intimidate everybody’.

Carville and Clinton had learned something that a lot of people in UK politics seem to be overlooking. The bond market, where government loans (gilts, in the UK) are traded, can decide what governments can – and cannot – do. It can also determine whether governments survive.

But because bonds are boring and a bit complicated (yields go up as prices go down – what does that even mean? And what on earth is a yield curve?) they don’t get enough attention. The value of sterling is an easier concept to grasp, so it’s been getting more attention of late, but bonds matter more to Liz Truss and the electorate.

Two weeks ago, the people and institutions that own gilts started selling them, fast.