How sobering to reflect that, as we enter one of the worst financial disasters this country has ever known, the two men in charge of saving the economy have been in their jobs for less than two months between them.
Rishi Sunak stepped over the threshold of Number 11 in the middle of February. Andrew Bailey took over at the Bank of England just a week ago.
Sunak was a battlefield promotion, taking over after his predecessor Sajid Javid unexpectedly resigned.
Rishi Sunak, left, stepped over the threshold of Number 11 as chancellor in the middle of February while Andrew Bailey, right, took over at the Bank of England just a week ago
He has been an assured performer so far, to the relief of all, except perhaps Boris Johnson, who he threatens to outshine.
And while Andrew Bailey is new in the role of Governor, he has spent almost his entire career at the Bank of England.
He is a solid, unflappable man and a veteran of the financial crisis in 2008. In the space of a few stomach-churning weeks, these two men have lived through more drama than many of their predecessors saw in years.
Billions of pounds have been wiped off the stock market, taking a bitter toll on the nation’s pensions and investments.
The pound has fallen to its lowest level in more than three decades. Millions of workers live in fear of losing their jobs or are already out of work.
In response, the Bank and the Treasury have wheeled out the heavy guns. Sunak listened to criticisms of his first Covid-19 package last week, which was based largely around loans.
The Government’s offer to pay 80pc of people’s wages is a huge help, as is the deferral of VAT. This support for workers beyond Jeremy Corbyn’s wildest dreams would be unthinkable in normal times.
But in the context of coronavirus it is right. Employment had been at a record high before the emergency put the jobs miracle in jeopardy overnight.
The key, if this is to work, is the speed at which it can take effect. The virus has laid waste to businesses that have taken years to build with alarming rapidity and protection measures need to keep pace.
Sunak will need to do more, in particular to help Britain’s army of self-employed who risk seeing their livelihoods evaporate. Bailey has cut interest rates to just above zero and launched a wave of QE money printing.
He too will have to do more. The big question is whether he has the right weapons at his disposal.
Rate cuts and flooding the economy with QE cash were effective measures during the credit meltdown of 2008, but this is a completely different type of crisis.
Put simply, lower interest rates won’t encourage people to spend, or businesses to invest, when the problem is a deadly pandemic that has brought all commercial activity to a screeching stop.
This is not to say a rate cut won’t help at all. It will, above all, by sending a signal to the markets that Bailey is ready to do whatever it takes to save the UK economy.
In practical terms, a cut in borrowing costs eases the anxiety somewhat for mortgage borrowers and those with personal loans and credit card debts – provided the lenders pass it on.
This effect is limited, though, because rates were already near rock-bottom before this cut. For savers, it is terrible news. They have for years endured tiny returns, well below inflation.
This is a desperate time requiring desperate measures, but, in the longer term, an economy that punishes savers cannot thrive.
Central banks and governments around the world have been taking similar actions to ours, so far to little avail. If they fail to limit the damage, it will scar a generation.
It turns out our prosperity was far more fragile than we thought, and the most powerful financial brains on the planet have been humbled by a tiny microbe, invisible to the human eye.
Some links in this article may be affiliate links. If you click on them we may earn a small commission. That helps us fund This Is Money, and keep it free to use. We do not write articles to promote products. We do not allow any commercial relationship to affect our editorial independence.