FIRST permit me two loud cheers for our Canadian Governor of the Bank of England.

I have not been convinced by Mark Carney's attempt at "forward guidance" - and remain a sceptic - but at the end of last week he certainly was bang on target in two important areas.

It was excellent to hear that he is more than willing to start discussing with the Scottish Government the possibility of a sterling currency union in the event of a Yes vote next September.

I am firmly of the view - and increasingly so - that this is the only feasible option for Scotland on the currency front.

Adopting the euro, creating Scotland's own currency or some pseudo shadowing of sterling would all be equally (to understate) problematic.

The sterling union also seems to me the best option, in principle, for the rest of the UK, ensuring currency stability with one of their main trade partners.

I accept - echoing the views of Professor Brian Quinn and others - that there are huge practical and technical difficulties regarding oversight of the financial sector by the Bank of England in the two countries that would then exist.

I also accept that some severe constraint would inevitably be imposed on overall Scottish fiscal policy - with effectively no influence over monetary policy.

But these are the type of issues that should be discussed pre-referendum and, given the Governor's wise pronouncement, can now be discussed.

There is a chance of knowing a little more about what a Yes vote would mean on the critical topic of currency before Scottish voters have to cast their ballot.

It was also excellent that Governor Carey determined to reduce the scope of the Funding for Lending scheme so that it will no longer apply to mortgage lending but only to lending for small businesses.

That makes every sense, both because of the risk of an over-heating housing market with wider repercussions and because investment is key to sustainable growth. (I shall return to these themes below.)

Now back to the continuing economic problems.

The latest cut of UK GDP data for the third quarter of this year reveals growth was distinctly robust - at 0.8% in the quarter - but essentially based upon a major growth in inventories and domestic consumption. Exports declined and the trade gap widened.

For the quarter the data for investment looked more encouraging, but these data are notoriously volatile and the Bank of England has indicated reservations.

The sharp growth in consumption was again achieved despite declining real incomes - and clearly indicating rising debt and a declining savings ratio.

Indeed household debt is now at an all-time record high, even higher than just before the crash. As Mr Carey has noted, this is a clear cause of concern for financial stability and presumably associated with the acceleration in house price inflation.

The latest data show house prices sharply up on a year back, not just in London and the south-east, and mortgage lending rising markedly.

Hence the governor's concern that financial stability is being placed at risk and hence the decision to stop use of Funding for Lending to further fuel the housing market flames.

Vince Cable welcomed the move; Chancellor Osborne may be less sure.

Growth may decelerate in 2014 as a consequence, as consumption growth slows and the savings ratio moves back upwards. That would be a desirable outcome, indicative of slower but more sustainable growth.

The continuation of the Funding for Lending scheme for small business is welcome in Scotland as well as the rest of the UK. However, in Scotland we continue to face problems over demand for lending to finance investment by indigenous businesses as much if not more than problems over the supply of funds.

As I have pointed out more than once in the past, Scotland excels at higher education R&D.

However, R&D spend by both the private sector and the rest of the public sector continues to lag behind practically our entire peer group. We still do not benefit from the extent of feed-through that we should logically expect from this R&D success.

Large chunks of business may not be seeking innovative investment opportunities and may not know what higher education has to offer. The sector - with notable exceptions - is still not doing enough to focus on understanding what business could use and developing potentially practical applications from its R&D.

Whatever the outcome next September, a successful Scotland needs to achieve high levels of innovation and high productivity growth in order to not just survive but thrive in the increasingly competitive global environment.

One solution lies in this link between higher education R&D and business. Another lies in making best use of skills in our labour force.

There is no space to dwell on this in this column, but data provided by Professor Ewart Keep at a recent DHI seminar really worried me.

For example, between 1997 and 2009 the volume of employer-provided training in the UK halved - and this was not just the impact of the recession. Employers are not investing adequately in innovation or skills. That is not the way forward to a competitive, dynamic, successful economy.

Jeremy Peat is a director of The David Hume Institute.