In his Autumn Statement George Osborne said that the UK government is now 'borrowing more cheaply than Germany" and (par 1.39) 'there is evidence that the Government's fiscal plans are contributing to improved market confidence, with UK long-term interest rates reaching a record low*.

This, though, runs into a problem. Low gilts yields - either in absolute terms or relative to overseas - are, in themselves, an ambiguous sign. Yes, they might signal confidence in the government's creditworthiness. But they might also signal that the economy is weak. How can we adjudicate between these interpretations?

One way is to look at share prices. If gilt yields fall because of better creditworthiness, share prices should rise as investors attach a lower probability to the risk of a debt crisis which causes capital flight and enforced austerity. But if gilt yields drop because of a weak economy, shares should suffer.

My chart tries to adjudicate between these two possibilities. It shows the FTSE small cap index (chosen because small caps are more exposed to the UK economy than the FTSE 100 which is dominated by multinationals) relative to MSCI's world index in sterling, which controls for global influences upon equity prices.

This chart is wonderfully ambiguous.

Tories can point to the rise in small caps relative to the world between May 2010 and this summer as a sign that the fall in gilt yields (from 3.8 to 2.5 per cent for 10 year ones) was accompanied by increased confidence in the UK economy - or, at least, reduced fear of a debt crisis.

However, Labourites can point to the drop in small caps since then as a sign that lower gilt yields are a sign of depressed economic confidence.

I'd stress that, in both cases, the moves are small; if I'd started my chart earlier, the last 18 months would look like a horizontal line.

The only message I'd take from this is that political disputes are rarely settled by the facts.

* I'm not sure this is strictly true. Yields on 2.5% Consols, for which we have the longest history, are now 3.68%, which is higher than they were between 1934 and 1950 or in the 40 years before World War I.