Fraser Nelson

Gordon Brown’s Baldrick-style Cunning Plan for global finance involves using the International Monetary Fund (IMF) as an “early-warning system”. Great idea.  When I was a business journalist, I remember the IMF early warnings – about how Brown’s switch to debt-fuelled profligacy post-2000 would end in tears. The key misjudgement made by both Brown and Greenspan was to try and get around the 2001 slowdown (which would have flushed out bad businesses and dodgy loans) by pumping the economy full of cheap debt. Pain delayed today means disaster tomorrow in financial markets. The IMF said in September 2001 that Brown’s spending spree was “regrettably pro-cyclical”. And since then?

A new Brownie was born today at 7am. Gordon Brown came on to BBC Breakfast this morning to tell presenter Sian Williams about how, as a family man himself, he sympathises with Ruth Kelly wanting to devote more time to her children. He didn’t expect to be grilled on his untrue claim that he has lowered the national debt. He repeated his Sky/Marr line: that debt had gone down from 44% to 37% of GDP. Williams told him this was untrue, and that the Office for National Statistics said so last week. She told him, rightly, that he arrived at his figure by subtracting Northern Rock - which he can’t wish away because he’s already sunk billions into it on the taxpayers’ behalf. Brown suggested it was daft to count in Northern Rock “No country does that,” he said.

In David Miliband’s “leaving do” speech for Gordon Brown, one line jumped out at me – when he said Gordon Brown has “transformed the debate about international development in Britain”. He has certainly transformed the accounting, by pioneering dodgy off-balance sheet financing of overseas aid. It’s worth revisiting, in the light of his new pious anger about banks who use off-balance sheet financing. His so-called International Finance Facility is a classic Brownite vehicle: it exploits a Eurostat loophole so if three or more EU countries share a pool of debt, it doesn’t show up on any of their books and they can fool their taxpayers into thinking they owe less than they do.

Coffee House is running a series of posts on the contenders to succeed Gordon Brown as Labour party leader.  The latest is below.  Click here for our profile of David Miliband, here for Jon Cruddas, and here for Alan Johnson. Jack Straw, 62, Lord Chancellor and Secretary of State for Justice Pros Experience: This is a man who has been an MP since 1979, and who - in his near thirty year career - has filled positions including Foreign Secretary and Home Secretary. On paper, at least, it's not a bad record, perhaps the best among any of the potential leadership candidates. Straw's got experience by the bucketful. And that's a useful commodity as the economic storm clouds darken.

The Brown demise is on a downward rollercoaster trajectory: it stabilises before it plunges again. I suspect that a period of stabilisation, and maybe even an upswing, is now on the cards. Yesterday went very well for him, and from the quotes I have seen he managed to get through even Jeff Randall on the Sky interview to be broadcast at 8pm tonight. Also, he may soon have another merger deal to point to.  EDF, which walked away from British Energy in July, will meet during the Labour Party conference to discuss a higher offer. Creating an entente nuclear is one of Brown's main ambitions - something which justifies his tough talk about "long-term decisions", and which, best of all, is a wedge issue with the Tories.

At 8pm on Friday, Sky will broadcast an interview with Gordon Brown which seals off what will be his best day for months. The risible idea that he somehow played matchmaker between HBOS and Lloyds TSB proved irresistible to news editors last night. It fuses together the political crisis with the financial one and has been written into the script. Him bumping into the part-time chairman of board of Lloyds (not Eric Daniels, who actually runs the company) has been puffed up into the moment when (as one newspaper put it) Brown ordered banks to merge. It’s the perfect myth, which allows him to say “I’m your man for the economic meltdown.” That’s not to say there were not plenty of political sweeteners in this deal, as James blogged earlier.

Is Gordon Brown trying to take credit for the HBOS-Lloyds merger? Sounds implausible, but the blog of Robert Peston, Brown’s biographer, has this snippet: “I am hearing that this deal has been negotiated at a very high pay grade level, with the Prime Minister, Gordon Brown, talking to Sir Victor Blank, chairman of Lloyds TSB, about how helpful it would be if Sir Victor could bring himself to end the uncertainty hanging over HBOS by buying it.” If this is true, I’m amazed the takeover went ahead, given that Brown tends to be 180 degrees wrong about any financial deal – whether it be selling gold at the bottom of the market or selling British Energy shares before they skyrocketed.