Tuesday, Dec 09, 2008
The New Economic Reality
BBC News Blog from Robert Preston: The New Capitalism
If you think house prices are going to bounce back in the next few years you should read this background article.
Posted by peter @ 09:24 AM (505 views) Add Comment
9 Comments
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1. paul said...
Almost missed this one. Nice find peter.
And this is the problem with reflating via quantitative easing. If the Bank of England are tempted, the ECB, Chinese and other creditors will never give us credit again. Why should they if we just press the "reset" button when we decide we can't pay/won't pay?
2. Rentinginthesouth said...
A very good read. Peston is a good voice in the mainstream media (although he does talk funny). ;)
3. luckyjim said...
Yes, great post.
Nice to see so many relevant articles here for a change.
4. goweresque said...
I see Pesto can't actually bring himself to name and shame our illustrious PM in the article, though if you read between the lines its pretty obvious who is to blame in govt. Also he doesn't actually spell out what all this means for the UK population - lower standard of living through lower wages (or no wage growth for many years) and higher taxes to pay for it all. He skirts round the issue but never nails it. I suppose that would be a bit too much truth to swallow in one go. But a good article - try and get people who don't follow economics to read it - they might just get some idea of how deep in the doo-doo we are.
5. 51ck-6-51x said...
Excellent post.
"There's a subtle but important point here. There were twin connected bubbles in assets and credit. Both of those bubbles have burst.!"
I would disagree - the asset bubble of which they speak was driven by the credit bubble.
"It takes a whole book to assign culpability. But the short answer is that we’re all at fault to varying degrees."
They still can't quite say it can they - the fault lies partly with people who were willing to borrow without asking why it's so cheap, but mainly with politician for keeping schtum and placing friendly market regulators when they knew they were storing up problems.
6. letthemfall said...
Yes, good post. You won't find a clearer and sounder article on the economic situation than this. It also comprehensively knocks down the idea that all will be well in a few months to a year.
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