We’re now a truth social post away from weaponised swap lines ⏰

New article with Lucia Quaglia examining the EU’s defensive statecraft to defend financial sovereignty around central clearing houses and Bigtech digital platforms, in Journal of International Economic Law doi.org/10.1093/jiel...

Admittedly far beyond the scope of what’s proposed here, but arguably a category error to assume that a decentralised blockchain is a natural evolution of postwar eurodollar markets when it represents something entirely new

Feels like a well worn path but raises many questions: 1) What exactly would the UK be aligning with given all the US loopholes? 2) How will issues of multi issuance / cross-border redemptions be managed? 3) Ultimately will the Fed backstop all this with swap lines? www.ft.com/content/3b81...

IMF going all in on stablecoins right now www.imf.org/en/Publicati...

Trump’s crypto policy to ‘save the dollar’ from…Trump’s tariff policy?https://www.ft.com/content/0d40abd6-70e3-4332-80e4-aa852cb9f026

Fwiw, Labour will likely be paying a ‘Farage premium’ on gilt yields long before Parliament is dissolved

An important reminder that the outcome of the next election is unlikely to be a Brexit or Truss mini budget-level event in the eyes of bond investors www.ft.com/content/a97d...

Aside from whether the UK outlier position on stablecoins proves sustainable, the bigger systemic issue is the scale and scope of the prospective clash between the BOE and a future Reform-led government

🚨 This year marks the last intake of undergrads born prior to the global financial crisis. What do concepts like neoliberalism and polycrisis even mean when your only historical reference point is Covid?

Are we seeing the rise of tech financed pop-up political movements? the-blindspot.com/repost-the-t...

Coming Soon, The Token Economy Trump posited that lots of real-world assets could benefit from a marriage with crypto. "Why is it that if I wanted to refinance Trump Tower, I couldn't tokenize this asset and put it on the street for billions of people to invest in it.” www.wsj.com/finance/curr...

I still hold that the rise of Reform, and the coalition of landed interests and alt-finance that back it, is prime territory for Cain & Hopkins and a theory of new gentlemanly capitalism

I suspect Reform will be looking closely at the US GENIUS Act - unleash sterling stablecoins backed by gilts, driving down yields and freeing up space for tax cuts 🪄 www.ft.com/content/0c97...

Short the pound

Crypto and gold is a natural alliance if your ambition is to disintermediate the state www.ft.com/content/135f...

Agree. UK confronting the natural limits of 90s technocratic governance (BOE, fiscal rules, OBR) when your captive market for long dated indexed gilts disappears

Leveraging gold www.ft.com/content/7d15...

I don’t know how British politics works if the Labour government confronts a gilt / sterling crisis when the main opposition party resides largely outside parliament

This is very good on the Silicon Valley canon, ideology and techno-aristocratic virtues henryfarrell.net/the-silicon-...

The Hirschmanian take. Truss ultimately undone by foreign bondholders power of exit; US exorbitant privilege relies on some combination of domestic investors’ (perceived) residual voice through Bessent and Trump’s capacity to strongarm business loyalty paulkrugman.substack.com/p/why-arent-...

‘Markets act as if everything is normal until it’s blindingly obvious that it isn’t.’ True, but this ignores how power and hierarchy also filter market perceptions. Bond markets are far less complacent about UK or French politics right now, quite the opposite open.substack.com/pub/paulkrug...

Running the digital euro on a public blockchain is a big call www.ft.com/content/8ad6...

‘Weaponised bullshit’ as a foreign policy tool glennkessler.substack.com/p/on-trumps-...

We are decades away from AGI

The ‘gold rush’ metaphor is symbolic of digital finance’s wider use of strategic ontology, framing that which is virtual and valueless as physical and scarce

Not debt monetisation but tokenisation www.ft.com/content/1914...

Status update

Unusual for the UK to find itself increasingly at odds, in tone at least, with both the US and EU on digital currencies www.bankofengland.co.uk/speech/2025/...

We’re seeing how digital finance has significant potential to disrupt the established epistemic politics of post GFC monetary and financial governance

There will be a lot of talk about City deregulation later, but history tells us that serious policy change requires the alignment of the City-BOE-Treasury nexus, which is less clear at this moment…

Intra-EU conflict over stablecoin regulation likely to be particularly protracted as it reflects the emergent epistemic - even ontological - geopolitics of crypto

A reminder that recent gilt volatility may have more to do with structural factors and liquidity constraints in long-dated gilt markets than questions around the government’s fiscal credibility

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High beta Britain in a uniquely difficult position. If investors lose faith in a government with a huge majority it’s unclear where the electoral resolution comes from.

I think the problem is less quantum of demand for Gilts and more natural habitat question - pension funds were reliable buyers of long-dated bonds. And the DMO will have structured issuance around market demand. Likely need to make big shifts to future supply across the curve.

Going through the (depressing) OBR Fiscal Risks Report and, bloody hell, that’s quite the chart. obr.uk/docs/dlm_upl...

Great point, which is itself a function of the electoral system. Telling if the most stable period of post GFC politics is the 5 years when we experimented with serious coalition politics

The big difference with Sept 22 being that while gilt markets hastened the departure of Kwarteng and Truss they may now save Reeves

6. Why did long gilts hate PMQs? Possible answers: a) Reeves seen as a fiscal hawk within Labour; PMQs raises chance of a new deficit-loving ChX; b) Govt seen as likely to collapse, and have you seen Reform UK's plans? c) UK revealed as fundamentally unserious country

Have spent insufficient time on gilt mkt today. Very quick thoughts. 1. Sell-off at the long-end properly nasty. Non-bond-types wondering whether to trust reports of 'bond mkt rout'? Rout is fair. PMQs look central to this.

Why we need an e̷p̷i̷s̷t̷e̷m̷i̷c̷ ontological politics of stablecoins

Great to host this workshop on Epistemic Politics with @benclift.bsky.social at Warwick yesterday

But arguably shadow money for shadow banks: www.tandfonline.com/doi/full/10....

Stablecoins backed by physical gold in Swiss vaults is the plot twist we’ve been waiting for

💸 @ipegbisa.bsky.social call for papers is next MONDAY 💸 Call for papers for the 2025 IPEG workshop on 12 September @SussexUni ends on Monday so don't miss out! 🌎'International Political Economy in a world on fire'🌎 Submit here 👉 buff.ly/CkWmJmd @drscottjames.bsky.social‬ @dasilvapp.bsky.social‬

Delighted that Lucia Quaglia was able to present our recent work on Bigtech finance at the BIS

Like post Brexit sterling, maybe the dollar’s fate is not linear decline but increasing oscillation between safe haven and high beta behaviour

FT readers this week