The Treasury has denied to Guido that a discreet Statutory Instrument is part of a secret contingency plan preparing for the potential collapse of the European Central Bank. At the end of May the government rushed through an order revoking the 1939 Trading with the Enemy Act, which prevented the UK from trading so-called Negotiable Instruments with former enemies – including former enemy Axis powers. The Act will now allow the UK to trade complex debt packages directly with EU countries, effectively allowing us to directly provide bailouts for European states unable to repay the money they owe to their British counterparts. Greece and Italy are on the list of countries that have now had their enemy status revoked for the purposes of dealing in their government’s debt paper.

The S.I. was slipped through quietly just before the Jubilee break at the end of May. Senior Treasury sources ignored our questions for weeks, until finally a junior press spokesman then directed Guido to Vince Cable’s  BIS. When Guido pointed out it was clearly a Treasury initiated Statutory Instrument they tried to play down the impact of the order, insisting that the existing legislation was obsolete and that it was simply an attempt to clean up the statute book. Yet with the Eurozone entering a new critical phase of financial crisis, the timing seems more than a coincidence…