Okay, it’s not the same Fred Goodwin. This one works as an analyst at Nomura, apparently.

But the Tories have seized upon Goodwin’s report which suggests “the prospect of a UK fiscal crisis is a clear and present danger”. The report suggests that a fiscal crisis is “far more likely” in the UK than in the US - because the dollar is a reserve currency.

“The UK fiscal dynamics are unsustainable. The fiscal balance is plunging deeply into the red in a spectacular and frightening way. Who will fund it? Without QE (quantative easing) the possibility of failed auctions is not trivial.”

Apparently the government’s mega-programme of gilt issuance (selling bonds) has not yet been fully tested - because it has been exceeded by QE (buying bonds).*

When the government turns net seller we will see whether there truly is a market appetite for UK gilts.

George Osborne described the Nomura report as a “wake-up call” with Britain’s “international reputation” at stake. Privately, however, the Tories must be as worried as the government is - given that the situation may still be with us in eight months.

UPDATE

The exact figures are as follows:

* As of September 10 there has been £145bn of QE (assets purchased by the creation of central bank reserves), of which £143bn has been gilts. The process began on March 11.

* Since that date the Debt Management Office has sold £95bn of gilts.

Expectations are for a Gordon Brown “recovery” speech on Tuesday when he faces the TUC Conference in Liverpool.

For all the (slightly) better economic/financial data out there, there is still an obvious dichotomy that Britain faces. Do you define the downturn by GDP figures (the formal definition of recession beging two quarters of contraction) or on unemployment figures?

With the dole queue set to grow for years to come, it’s a vital question.

Brendan Barber, head of the TUC, made the point this morning on the BBC’s Politics Show:

I don’t think that’s a real recovery until we begin to see unemployment coming down, and I fear that we, we’re a long way off that.

Alan Johnson was on similar ground, albeit in a slightly garbled way:

I don’t think we’re through the worst of the recession, I, I mean it’s a matter, I think Alistair Darling has led us through this, with Gordon Brown, in, in, absolutely calling every single turn of this the right way. When, when we look at this now, there.. I don’t think we can say that we won’t get any more bad labour market figures, I don’t think we can say that we’re in a situation now where manufacturing is going to recover completely, what we can say, I think, is we’ve seen the early signs, in the construction industry, in consumer confidence, in my own constituency here we’ve seen that the, that the increase in unemployment has kind of levelled off. Now I’d like to think that’s the early signs, but I think there’s a long way to go and what I think the British public need to do as we approach the next Election is listen to the various … plans of the parties for how to get through this…

Of course, no minister wants to prematurely call the recovery. Spotting green shoots is a risky business, as Baroness Vadera found out earlier this year.

Precisely how Mr Brown will address this question on Tuesday will be fascinating to watch. I suspect there will be more rather more about how Labour prevented a financial catastrophe than premature optimism about the imminent future.

According to Sky the speech will include this:

Today we are on a road towards recovery - but things are still fragile not automatic and the recovery needs to be nurtured. People’s livelihoods and homes and savings are still hanging in the balance, and so today I say to you: don’t put the recovery at risk.

“Road towards recovery” is a phrase which covers all options pretty well. It could be a swift road - but also a long and winding one with many potential setbacks etc etc

A brief passage in George Osborne’s last Andrew Marr interview stands out: In it, the shadow chancellor heaps praise at the feet of the world’s central banks for preventing financial meltdown.

“But we say the most effective form of stimulus is monetary policy, is the low interest rates, which both here and around the world I think have been the most effective tool at bringing the world back from the brink of depression.”

A statement of the obvious, you might think. But was Osborne playing up the actions of Mervyn King and others to belittle those of Gordon Brown? A Tory MP suggests that this strain could grow louder as the party seeks to rob Brown of the credit for halting the apocalypse.

For some time now I have been asking the Treasury for an explanation of Alistair Darling’s Budget claim that government actions have saved “up to 500,000 jobs”.

My questions:

1] What research is this based on?

2] Is 500,000 at the upper end of a wider range of estimates; eg “350,000 to 500,000″?

3] How much of the 500,000 is down to political action and how much is due to the actions of the Bank of England - ie quantatative easing and interest rate cuts?

It’s been at least three weeks and the Treasury still hasn’t answered the question. Although they say they may provide more detailed analysis later in the autumn.

Gordon Brown has pledged tough action to clamp down on excessive remuneration for bankers as part of an international effort to rectify the systemic weakness that led to the global financial crisis. Read the interview on ft.com

After an inquiry found evidence of “systemic corruption” in the island’s government, British ministers decided it was time to move back to direct rule. Preparations are advanced and the British governor is poised to take over, but the final act has been delayed by legal challenges related to the inquiry.

This has given the 32,000 TCI inhabitants some time to man the barricades of the capital, Cockburn Town. Galmo Williams, their new premier, is in fighting mood. Seeing Iain Dale’s post today on the islands reminded me of a statement Williams gave us a couple of months ago. It deserves a wider audience.

Harriet Harman can’t let the gender issue drop (see yesterday’s blog). Now she has called for more women on the boards of financial services groups. Fair enough.

But she has gone further by adding: “Someone said that if it had been Lehman Sisters, instead of Lehman Brothers, there might not have been so much difficulty.”

(Apparently the quote is from Neelie Kroes, EU competition commissioner.)

So is the deputy Labour leader right?