The incoming governor of the Bank of England (BoE), Mark Carney, inherits a legacy of recession and banking disasters in the United Kingdom.
Britain is struggling to pull out of the longest economic depression in 100 years and the BoE is now being seen as one of the main causes of the country's economic ruin.
The outgoing governor Sir Mervyn King failed to wake up to the coming of the financial crisis in time and finally responded by propping up ailing banks with huge cash injections of taxpayers' money.
When Royal Bank Scotland (RBS), then one of the largest banks in the world, hit the rocks the UK government added a further £45.5 billion (Dh257.64bn) to its existing stake, giving it an 81 per cent stake in RBS.
This represented an investment of £720 for every UK citizen. According to The Economist magazine, the value of this stake has since fallen to £470.
It is, therefore, hardly surprising that, according to a survey in the BoE quarterly bulletin, fewer than half of UK citizens polled were satisfied with the way the BoE does its job.
But Sir Mervyn has left Mr Carney a dual legacy. In addition to an economy in tatters and a population whose faith in banks is at all-time low, he also inherits a set of new powers.
No incoming governor in the BoE's history has been presented with such a glittering array of weapons. The central bank's powers have been greatly enhanced as a result of the financial crisis. Mr Carney will be responsible for financial stability as well as monetary policy.
The City of London is waiting with bated breath to see how Mr Carney intends to use his wide-reaching powers. So far, however, the incoming governor is keeping his cards close to his chest.
Nevertheless, Mr Carney made several revealing comments on his new role to the treasury select committee at his appointment hearing, putting considerable distance between his strategy and his predecessors, which involved saving failing banks at any cost. "We need to build understanding of the new regime as one in which it is understood that financial institutions can fail but that, if they do, their failure will be controlled and will not threaten the system," Mr Carney told the committee.
He went further to indicate a radical policy switch away from rescuing ailing institutions.
"The implicit state subsidy for banks needs to be removed," he added. "To do that, we need … to establish a full and credible resolution regime to sort out failing banks without recourse to the taxpayer."
He also told the committee a new approach to the banking system was needed.
"We need to embed a culture that assesses emerging vulnerabilities, stress tests the financial system, and monitors the boundaries of what activities are and are not regulated."
Mr Carney added there is an international dimension to financial stability which means the BoE will need to engage with European partners such as the European Central Bank.
"The Bank [of England] must continue to play an important role in ongoing efforts to develop a more resilient and efficient international financial system."
But, to revive Britain's confidence in its banking system, Mr Carney will have to grasp much more toxic nettles than these.
The BoE's financial system has increasingly large fault lines appearing in it. The euphoria that surrounded Sir Mervyn's early years as governor cloaked some basic flaws in his financial and economic strategies.
When he joined the BoE as its chief economist in 1991, the bank had just driven the UK into recession by at first shadowing Germany's Bundesbank and, in 1990, joining the exchange rate mechanism.
Sir Mervyn's subsequent perceived success in curbing inflation blinded his admirers to a simple truth: the inflation figures were essentially rigged.
Property prices were deliberately excluded from the BoE's figures. Sir Mervyn firmly believed it would be pointless to allow an essentially volatile property market to drive an inflated economy into recession.
But the UK's property market is a key factor in determining its overall economic prosperity. When property prices are rising, few mortgage holders object to high interest rates. But in the kind of falling property market experienced in Britain at the start of the recession, high mortgage rates only add pain to reduced or, in some cases, negative property equity.
The banks themselves were also responsible for the large-scale mortgage lending that fuelled the UK's residential property boom between 2002 and 2007, which was followed by a sharp drop in house prices.
But any attempt by Mr Carney to include property prices in the BoE's inflation figures will make it hard for him to predict and control inflation targets in the way his predecessor did.
Rather than taking the risks implicit in a complete strategy rethink, Mr Carney may initially decide to bide his time and see whether the economic climate starts to improve without any dramatic intervention on his part.
The City, or London's financial district, is already anticipating economic growth of 0.5 to 0.6 per cent in the second quarter of this year, double that of the first quarter. Should this trend look like continuing throughout the year, Mr Carney may decide to keep a light hand on the reins of the British economy.
He may provide more insight into whether he will prioritise tackling inflation over the introduction of forward guidance on policy decisions in his first quarterly Inflation Report, according Morgan Stanley.
UK consumer prices accelerated to a 2.7 per cent rate in May, exceeding economist estimates and staying above the BoE's 2 per cent inflation target.
If the governor-designate uses the August report to present his thoughts on guidance it would imply that rate expectations have come too far, Sam Hill, a rates strategist at Royal Bank of Canada in London, told Reuters.
"There is the likelihood for forward guidance that underpins the bias the MPC has had of responding less aggressively to inflation risks than they have done to the risk of disinflation," he said. "We are in danger of getting carried away."
But there are already indications the UK's fragile recovery may be short-lived. Real incomes are under pressure and the global economy has also slowed since the year began. The government's continued austerity measures are also likely to compound any potential economic woes.
With little real light at the end of the economic tunnel, Mr Carney will soon be under immense pressure to make some dramatic and far-reaching changes to the UK's existing financial and monetary policies.
But to Darren Williams, the senior European economist at AllianceBernstein Holding in London, the likelihood is the new governor will win the day, albeit over time.
"We expect the conduct of monetary policy to change markedly under [Mr] Carney's stewardship," Mr Williams told Bloomberg last week.
"The process will be more evolutionary than revolutionary."
