The UK government has just borrowed £62bn in a month, which is more than it planned for the next year. People are sending out panic signals. They’re suggesting the gov’t has a crisis. But that’s not true. That needs explanation. 1/

First, the government is not having a crisis. It’s carrying on. And doing a great job. We clap the NHS. It’s the private sector that’s having a crisis. It’s that part of the economy that’s lost the money. We need to remember that. 2/

Second, the government is making good the capital lost by the private sector. That’s it’s role. If it did not do it we'd really have meltdown. We don’t want or need meltdown so the government is covering private sector failure. 3/

Third, there is no debt crisis. This year the gov’t has already bought £200bn of gov’t debt back from markets and is expected to do another £100bn soon. That means that right now the government owns at least £575bn of its own debt. 4/

Fourth, if the gov't owns £575bn of its own debt that means it never has to repay it or pay interest on it. What's more it means total debt was actually only £1.23trn in March this year, and not the £1.8trhn the gov't claimed. 5/

Fifth, so gov't debt - the value of gilts in issue - was only 55% of GDP in March 2020 and not 81% as the government said. 6/

Sixth, it will take exactly £1 trillion of borrowing on that basis to make the debt 100% of GDP. And that won't happen because there will be more QE before we get anywhere near that. 7/

Seventh, the QE already done also explains how the debt is being bought right now: the gov't has already injected the money into the financial markets to provide the cash so they can buy this debt. So there will be no debt crisis. 8/

Thanks goodness for the good old magic money tree - otherwise called the Bank of England - that can produce money on demand to keep our economy going as best as possible without anyone having to panic. 9/

Keep calm in other words: the chance that this supposed new debt is a matter of any great economic consequence is close to the square root of diddlysquat. /Ends