Friday 6th August 1982
Mkts subdued today after great sell out yesterday - nearly funded all for August - and sold 1988 IG’s [Indexed Gilts]
Geoffrey [Sir Geoffrey Howe] for an hour - he was a bit upset I had primed the PM on the extension of the short tap - but generally v. friendly. Talked about Defence and need for some control on spending.
Monetary Control + poss of conversion - he was very cautious but agreed that Gov [Gordon Richardson] had got the message of no more conventional longs.
PM returned my paper on European Credit Subsidies - clearly not v. happy with my hawkish attitude - but GH agreed that they were Nationalised Industries + GEC and the SAME gang who got benefit