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The Bank of England said yesterday it will exchange about 50 billion pounds ($100 billion) of government bonds for mortgage securities, mimicking a swap of $200 billion worth of securities by the U.S. Federal Reserve last month. Brown, whose popularity fell the most on record in a newspaper poll published April 13, said “we will make sure there is enough liquidity in the economy to make sure people can buy their own houses.”

While Goodhart says the Bank of England’s plan doesn’t back up that guarantee, it may do enough to take the sting out of any economic slowdown.

Possible Recession

“The credit crunch will still hit the economy, but it might have hurt more if it weren’t for these measures,” said Goodhart, 71, who served on the MPC from 1997 to 2000. “The measures prevent the risk of a possible recession becoming a depression.”

Goodhart is the author of “Goodhart’s Law,” which holds that targeting monetary aggregates as a surrogate for inflation is futile.

U.K. Chancellor of the Exchequer Alistar Darling will meet mortgage executives at 3 p.m. today in London and so far there are few signs of a coordinated effort to slash lending rates. While Abbey National, Britain’s second-largest mortgage lender, said yesterday it’s reducing rates on some adjustable loans, it also raised them for borrowers who make deposits of less than 10 percent.