Martin Wolf takes issue with John Kay's prescription for Narrow Banking.  I thought that Kay said far too little about assets.  In his world, how will, um, Finance get to the people who want finance?  Wolf asks:

A more profound issue is whether a financial system based on narrow banking could allocate capital efficiently. . . .Here there are two opposing risks. The first is that the supply of funds to riskier, long-term activities would be greatly reduced if we did adopt narrow banking. Against this, one might argue that, with public sector debt used to back the liabilities of narrow banks, investors would be forced to find other such assets. . . The opposite (and greater) risk is that the fragility of banking would be re-invented, via “quasi-banks”. This is what has just happened, after all, with “shadow banking”. In the end, those entities, too, have been rescued

 More Mansion Tax. Don Paskini (Labour) thinks that the public, if polled, would like it. BlogDial comes out with some daft objections that seem to misunderstand the £1m threshold. 

The .5% tax will be enough of a disincentive to getting one of these houses; why go for a house that costs 1M when you can get one for .950k and avoid an annual bill of £5,000? Anyone owning a house that is worth almost 1M will have no incentive to do any sort of repair or improvement on it. Anything they do that might increase the value of the property will immediately put it in the new category, which will mean that not only will they instantly be liable for this new tax, but the prospects of selling the house in the future will be significantly decreased.

No, irdial: if the property is worth, say, £1.05m, then the charge will be £50k *0.5%, which is £250.  Sigh.

And the usual objection from ALTER types in an FT letter: do the proper thing and bring in Land Value Tax. 

David Miles speech on QE is enormously interesting and different from the previous ones that other MPC people have given. Norma Cohen explains more.   He seems to be saying "Money is not the issue - it may not work that way - but it will help Banks transition to a new regime of more liquidity/less risk". The IMF reports that they have a long way to go to fill their holes.

There seems to be a choir singing a lot of different tunes in Threadneedle street. If like me you think that a big part of QE is its effect on expectations, this really matter. The BOE has lost its grip in that area. 

FINALLY, Buttonwood resurrects a worry that people thought was GOING to be the big one, before the big one actually happened entirely differently: a collapse in the dollar. 

It is hard to think of a parallel in history. A country heavily in debt to foreigners, with a government deficit it is making little attempt to control, is creating vast amounts of additional currency. Yet it is allowed to get away with very low interest rates. Eventually such an arrangement must surely break down and a new currency system will come into being, just as Bretton Woods emerged in the 1940s.