The argument this series makes, in 9 steps. It is the same spine every module is built on, and no module states more of it than its own share.
Liz Truss's new government capped household energy bills, then on 23 September 2022 announced a Growth Plan of tax cuts, aiming for 2.5 per cent trend growth and paid for by borrowing.
The Treasury did not ask the Office for Budget Responsibility for a forecast, so the plan came without an independent assessment of the public finances, while extra borrowing was to be raised by selling more gilts.
Investors sold the pound and gilts: the pound fell to about 1.07 dollars on 26 September, and the 20-year gilt yield rose by about a percentage point in three working days.
Falling gilt prices cut the value of pension schemes' LDI funds, which had borrowed; their lenders asked for more cash, the funds sold gilts to raise it, and the selling pushed prices down further.
On 28 September the Bank of England began temporary purchases of long-dated gilts, until 14 October, to restore orderly trading; it bought 19.3 billion pounds and sold them all back by January 2023.
Fixed mortgage rates, already rising with Bank Rate, jumped in October as markets expected a much higher Bank Rate, on the Bank's account, then eased by December.
Within four weeks most tax cuts were dropped: the top-rate cut on 3 October, the corporation tax cut on 14 October when Jeremy Hunt replaced Kwasi Kwarteng, most others on 17 October; Liz Truss resigned on 20 October.
Afterwards the Bank's Financial Policy Committee asked for LDI funds to withstand a 250 basis point rise in yields, and a 2024 Act made the Treasury request an OBR report before announcing measures above a cost threshold.
Why the reaction was so sharp is argued: the IFS pointed to borrowed tax cuts during high inflation and rising rates; the OBR found UK factors made moves worse around 23 September, within mostly global changes since March.