The markets clearly aren’t in the slightest bothered by what’s going  on in parliament and Downing Street.

Close of play on 12/01/22

Johnson’s apology might as well have played out on  Emmerdale for its economic significance. (Johnson and Meena are interchangeable comedy villains in our family).

When will Meena pay?

Are we to take this as a signal to Johnson that his continuance in office is of little consequence or should we remark that our political governance is a matter of little interest to this country’s economy?

Either way, what matters to the people (and Johnson’s behavior does matter to us) and what matters to the markets- are quite different.

I am not sure that that dislocation is a good thing, and I’m not blaming the markets. It has come to a pretty pass when we are governed by someone who makes it up as he goes along.

Johnson is no “tricky Dicky” Nixon, his brand of buffoonery comes out of the Bash Street Kids. We love a clown and for the past two years we’ve allowed a clown to lead us through the pandemic. But what’s happening now is an embarrassment , not just to Johnson and his party , but to the voters. As I said yesterday , we don’t like being made a fool of, and when  we’re struggling with matters of life and death, having us believe you would  “bring your own booze to a work event”, is an insult to our collective intelligence. But the joke is on us – and we’re angry.

Meanwhile the markets move on, buoyed by whatever they are gleaning from economic data and undistracted by the complete breakdown in governance at the very top of the political pole. I wonder how decent Tory politicians (any politician for that matter) feel about the way that Government is being down-valued by Johnson’s behavior. There are people who will laughingly deny the phrase “decent politician” validity.

We pay a lot of attention to governance in valuing corporate behavior and I suspect that the market cares a lot about political governance too. Which leads me to suppose that it considers Johnson’s behavior so aberrant that the system will revert to mean pretty sharpish and restore normality in the form of a Truss or Sunak. Johnson clearly doesn’t have a substantial political following in the way Trump has and his premiership has become economically irrelevant. The next few weeks will be full of noise  but where politics matters – in the physical and financial health of the nation – Johnson doesn’t.

That’s not good for Johnson and it’s not good for our political governance. We need a firm hand at the tiller not an overreaching incompetent, Icarus’ demise didn’t make  much of a splash either.

Icarus fall barely touched the markets either (source Pieter Breugel)