ABSTRACT
The ‘new approach’ to ‘competition and credit control’, introduced in 1971, was an attempt to apply the lessons of history so as to produce a scheme of monetary control which was both operationally feasible and as immune to criticism as possible. Failure to appreciate this point in 1971 led to much misunderstanding of the ‘new approach’, especially by the press. The scheme was wrongly presented as representing the conversion of the Bank to monetarism. Equally inaccurately, it was presented as another application of the market principles of the newly elected (1970) Heath government then in its ‘Selsdon man’ phase, when, for example, it introduced museum charges.
