My hypothesis is that they put the gilts up as collateral so that they could borrow money to invest. So, interest rate goes up, and the value of existing gilts goes down, because why buy a gilt with 1% interest when you can get a new one with 2% interest? Pension funds need to add more collateral to their accounts, because the gilts became less valuable.

Thanks, but how did the pension funds hedge against interest rates in a way that they had to pay up when the interest rate went up?

Thanks. I’ll check it out in the evening.

So, this minibudget included tax cuts, coupled with a massive increase in government spending, which then caused the currency to devalue. Still don’t fully understand how it got this bad, though.

What did she do to make people’s mortgages go up?

I don’t get it. Could you explain what you mean by that?