The marketplace was only briefly assuaged by the Bank of England’s surprise announcement Wednesday that it will begin purchases of U.K. government bonds in order to stabilize the rattled U.K. bond market. However, markets quickly brushed aside the move as being insufficient. Risk aversion remains elevated. The U.K. government has created a “loop of doom” that threatens the entire financial system and they must act urgently, said Nigel Green of the DeVere Group. “Markets now know where the weakness lies. Intervention paints a target on the back of the body that intervenes.” If the U.K. government does not change its tax and spending plans, “they will have blown up the U.K. mortgage market, U.K. pensions, amongst others, and eventually (a contagion) could spread to the wider global financial markets which themselves are sitting on thin ice as liquidity disappears,” said Green. —Stay tuned. Jim Wyckoff