this week.

The Conservatives say they'll blow a £1.2tn hole

in the nation's finances, creating a tax bombshell.

Labour dismisses this as nonsense.

It says higher tax will pay for day-to-day spending

on things like more nurses and doctors,

and it will only borrow for higher capital spending.

Some £55bn a year for transport, broadband, green energy,

hospitals and schools.

That's a lot more, more than doubling current public sector

investment plans.

It's also a lot higher than the Conservatives' promise.

Labour plans would raise government investment back

to levels last seen in the 1970s.

That's over 4 per cent of national income,

raising some big questions about whether Britain

can finance its borrowing, and whether it'll be well spent.

We sought to find out how investors

and British government debt might react.

The Chancellor, Sajid Javid, says they'll run scared.

He was talking about Labour creating an economic crisis

within months.

But on the financing question, the government bond market

doesn't appear terrified.

The UK government can borrow for 10 years

at a cost of only 0.75 per cent, a little up from a month ago

but still extremely low.

We also talked to many people in the markets.

The main view was that investors would be willing to finance

Labour or the Tory plans very cheaply.

For example, Mark Dowding, chief investment officer

at BlueBay Asset Management, summed up the view saying,

there was a once in a generation opportunity

for a big fiscal expansion.

But you shouldn't think that because bond investors are

prepared to fund big spending, they think it's a good idea.

Many we spoke to thought pushing so much money out of the door

so quickly would lead to waste and bad investments.

The bond market isn't full of vigilantes at the moment,

ready to push politicians around.

They're happy to finance Labour's plans,

even if they think the proposals won't work.

And there's a simple reason why.

They believe even if the plans are nuts,

they'll still be repaid, with at least some interest.