The Masked Tulip Posted June 29, 2009 Share Posted June 29, 2009 In fact, it is the headline on the front page of the Independent so all the luvvies in the Meeja who get the Indie by mistake for the Grundian will have a panic. Quote Link to comment Share on other sites More sharing options...
Mikhail Liebenstein Posted June 29, 2009 Share Posted June 29, 2009 In fact, it is the headline on the front page of the Independent so all the luvvies in the Meeja who get the Indie by mistake for the Grundian will have a panic. Its the lazy W I reckon. So much for the Nike Swoosh. Quote Link to comment Share on other sites More sharing options...
BROF Posted June 29, 2009 Share Posted June 29, 2009 (edited) http://www.independent.co.uk/news/business...on-1724447.html Warning: Britain faces new recessionEconomy set to relapse into dreaded 'double-dip' downturn, say world's central bankers By Sean O'Grady, Economics Editor Tuesday, 30 June 2009 The world's central bankers have warned that the British economy faces relapsing into another recession – the much-feared "double dip" downturn. A continuing drought in bank lending, evidenced in the latest figures from the Bank of England, and the threat that spiralling public borrowing will feed through to higher interest rates and inflation, are judged by international economists to be mortal dangers to a sustained recovery. The Organisation for Economic Cooperation and Development (OECD), which comprises the 30 most advanced economies in the world, added to the gloom, saying that Britain remained "deep" in recession and faced a "bleak short-term outlook". "The recovery is likely to be slow and unemployment is expected to climb significantly," it said, adding that the Treasury could do "considerably more" to fix the public finances. Both warnings are at odds with recent market optimism and so-called green shoots suggesting that output in the economy may be recovering. But the Bank for International Settlements (BIS), which includes the Bank of England, the US Federal Reserve and the European Central Bank, said it feared that the problems of the world's banks are far from fixed and could easily trigger a so-called "double dip" or "W-shaped" downturn. "A major cause for concern is the limited progress in addressing the underlying problems in the financial sector," it said. "A significant risk is therefore that the current stimulus will lead only to a temporary pick-up in growth, followed by protracted stagnation." The BIS cautioned that "governments may not have acted quickly enough to remove problem assets from the balance sheets of key banks". It added that financial products should be treated like medicines and sold to consumers only when they are certified safe, to help prevent a repeat of last year's financial meltdown. Figures from the Bank of England yesterday confirmed that the banks and building societies remain reluctant to lend to any but the most secure of businesses and home buyers. Mortgage approvals barely improved during May, remaining stuck at a little over 43,000 – some way above the nadir of 27,000 last winter, but under half of their normal level. Analysts at Capital Economics said the figures were "consistent with house prices falling at double-digit annual rates". Detailed data on changes to the money supply indicated that relatively little of the £100bn pumped into the economy by the Bank of England through its policy of "quantitative easing", akin to "printing money", is finding its way as yet into meaningful lending by the banks to small businesses and first-time buyers. A small improvement in consumer confidence was registered last month, and there is plenty of evidence of more buyer interest at estate agents and of shoppers continuing to shop. However, for as long as the banking system remains reliant on public funding and unwilling to offer credit, little of this still-fragile optimism will be seen in hard purchases of "big ticket" items such as houses, cars and other goods linked to house purchase, such as electrical appliances and furniture. Figures to be released by the Office for National Statistics are likely to reveal that the downturn in the UK in the first quarter of the year was even more severe than first thought, though most economists think the worst of the slump is over. A CBI survey published yesterday said more than 95 per cent of banks and building societies expected their bad debts to rise over the next few months. Such write-offs will join the existing "toxic assets" on the banks' balance sheets and make them even less willing to take on riskier lending – the much feared "negative feedback loop". Most embarrassing for ministers is the OECD's "health check" on important public services. The OECD agreed that, since Labour came to power in 1997, health spending has "surged" but "the returns so far appear modest". Ironically, given official enthusiasm for "league tables", the OECD says the UK's economic future is endangered by the inequality of educational achievement – a factor which has left the UK towards the bottom of the league table of advanced economies for social mobility: "International standardised tests show that the UK lags better performing countries significantly." However, the OECD supports the shift away from targeting: "The focus on raising the school leaving age and meeting performance targets in education may still be distracting attention from the more important goal of raising core literacy and numeracy achievement." It adds: "Adequate provision of public infrastructure should be a priority, particularly in transport where road and airport congestion, and problems in the rail system impede business and constrain productivity." Ministers have cancelled this year's Comprehensive Spending Review on the grounds that the economic picture is too uncertain and that, after a general election, "tough choices" may become easier to implement. Still, the OECD said it wanted "explicit" detail on spending cuts and tax rises, adding: "Experience in other countries suggests that a focus on expenditure cuts, rather than revenue raising, is associated with more successful consolidations." At the moment, the OECD claims, the Government is not being "ambitious" enough. Edited June 29, 2009 by BROF Quote Link to comment Share on other sites More sharing options...
Fairies Wear Boots Posted June 29, 2009 Share Posted June 29, 2009 I thought this bit was interesting. A continuing drought in bank lending, evidenced in the latest figures from the Bank of England, and the threat that spiralling public borrowing will feed through to higher interest rates and inflation, are judged by international economists to be mortal dangers to a sustained recovery. Roger Bootle suggested inflation might may stay low for the next five years the other day, and he is normally on the money. I still think there is a decent chance of rates having to be put up. Quote Link to comment Share on other sites More sharing options...
libspero Posted June 29, 2009 Share Posted June 29, 2009 A significant risk is therefore that the current stimulus will lead only to a temporary pick-up in growth, followed by protracted stagnation. That seems particularly relevant.. I interpret it to mean, we can only borrow and print for so long to fill the funding gap. Then, reality. Quote Link to comment Share on other sites More sharing options...
crash2006 Posted June 30, 2009 Share Posted June 30, 2009 i'd like to know who is doing the lending is it the government owned banks or the private ones? Quote Link to comment Share on other sites More sharing options...
Guest Parry Posted June 30, 2009 Share Posted June 30, 2009 Right then. FFS! How long did the last recession last? At least, AT LEAST 6 years. There seems to be an awful lot of uncertainty about the inevitable. Pumping a a few million roll-on-roll-off waste skips full of money into any economy will result in a short term blip 'return to normal' good times. How long can that last? Not very. . . . and so reality bites. Quote Link to comment Share on other sites More sharing options...
spivT Posted June 30, 2009 Share Posted June 30, 2009 "A significant risk is therefore that the current stimulus will lead only to a temporary pick-up in growth, followed by protracted stagnation." siginificant risk ? that's the most likely outcome. why else are the mooting a second stimulus in the US. Not even china can drive global growth to 6% annually as it was during the boom. Quote Link to comment Share on other sites More sharing options...
bogbrush Posted June 30, 2009 Share Posted June 30, 2009 Fundamentals are all that matter. You can stuff your consumer confidence up your ****, until we address a catastrophic balance of trade and a state apparatus sucking the life out of the economy there is no hope. Like Parry says, shovelling some skips of notes into the breach is no solution, and as the OECD says insane obsessions like forcing everyone to stay at school until whenever rather than coping with the fact our school leavers often can't write are futile. Interesting to see them comment again on the social immobility in Britain. What do you expect when you structure society so it becomes more and more acceptable to embrace a life of stagnation rather than providing all incentives to advancement? Life isn't kind you know, it's supposed to be a struggle. Quote Link to comment Share on other sites More sharing options...
Guest Parry Posted June 30, 2009 Share Posted June 30, 2009 Fundamentals are all that matter. You can stuff your consumer confidence up your ****, until we address a catastrophic balance of trade and a state apparatus sucking the life out of the economy there is no hope.Like Parry says, shovelling some skips of notes into the breach is no solution, and as the OECD says insane obsessions like forcing everyone to stay at school until whenever rather than coping with the fact our school leavers often can't write are futile. Interesting to see them comment again on the social immobility in Britain. What do you expect when you structure society so it becomes more and more acceptable to embrace a life of stagnation rather than providing all incentives to advancement? Life isn't kind you know, it's supposed to be a struggle. Remember the 1990's carnage? Trade deficit and real fundamentals reported constantly. Emphasis on what was REAL and IMPORTANT. Quote Link to comment Share on other sites More sharing options...
bogbrush Posted June 30, 2009 Share Posted June 30, 2009 Remember the 1990's carnage?Trade deficit and real fundamentals reported constantly. Emphasis on what was REAL and IMPORTANT. Indeed. I date myself by revealing that I remember when the Balance of trade stats were a standard item on the main news programmes every month. I always consider them to be the National P&L account, and I must say it would be a novel concept to try and run a company not on whether the monthly P&L account is healthy, but on how everyone "feels". Still, nobody in government knows anything about that, so they? Quote Link to comment Share on other sites More sharing options...
winkie Posted June 30, 2009 Share Posted June 30, 2009 It is impossible to force/manipulate the markets...water always finds its natural level. Quote Link to comment Share on other sites More sharing options...
ralphmalph Posted June 30, 2009 Share Posted June 30, 2009 Right then.FFS! How long did the last recession last? At least, AT LEAST 6 years. There seems to be an awful lot of uncertainty about the inevitable. Pumping a a few million roll-on-roll-off waste skips full of money into any economy will result in a short term blip 'return to normal' good times. How long can that last? Not very. . . . and so reality bites. Just for clrification I think you meant the last HPC lasted 6 years. If you are reffering to the recession of the early 90's I think it lasted about 3 years and we only started to show growth when we got out of the ERM. Quote Link to comment Share on other sites More sharing options...
interestrateripoff Posted June 30, 2009 Share Posted June 30, 2009 You mean I'm going to have to wait a bit longer before my house is worth £1.38bn. Damn. Quote Link to comment Share on other sites More sharing options...
Guest Parry Posted June 30, 2009 Share Posted June 30, 2009 Just for clrification I think you meant the last HPC lasted 6 years. If you are reffering to the recession of the early 90's I think it lasted about 3 years and we only started to show growth when we got out of the ERM. Not so sure about that. Things were bad for at least 6 years. 1989 to 1995. This is a completely different ball game to that, structural failure. I'll throw my hat in and say we are in for 15 years of real sh1t. Quote Link to comment Share on other sites More sharing options...
DrGUID Posted June 30, 2009 Share Posted June 30, 2009 > I still think there is a decent chance of rates having to be put up. They don't need to put them up, banks are raising rates anyway. Quote Link to comment Share on other sites More sharing options...
non frog Posted June 30, 2009 Share Posted June 30, 2009 ......I'll throw my hat in and say we are in for 15 years of real sh1t. This is, IMHO, a real possibility. However I would like to know what you think will turn the sh1t round? Looking forward that kind of distance the demographic timebomb will have gone off and rising costs of care for the elderly will be dragging down any attempt by the government of the day to cut welfare costs. Furthermore the general loss of equity by Britain's householders will exacerbate that trend as fewer people find their property is enough to cover care costs. Then factor in the massive tax rises needed to pay for the huge sums of money being borrowed now, plus the massive tax rises needed to pay for the environmental changes (whether you accept the real need or not - they will happen so must be paid for) like carbon capture on the coal fired power stations. Also in 15 years time we must begin to look at the oil prices (assuming we are still allowed to burn it ). Surely by then the extraction and prospecting costs will have pushed up prices. I really am at a loss to see where the turning point is simply because the baby boomer generation has screwed the planet over so much at the expense of their kids and grandchildren. One answer is 70s style inflation I guess and that is another real possibility. But this again will destroy people's pension provisions (most are already rather poorly as far as I can see from what I read). So we are agreed about the sh1t but I'd like to know what you (or anyone else) thinks will turn it into lovely compost to grow nice new green shoots in? Quote Link to comment Share on other sites More sharing options...
abharrisson Posted June 30, 2009 Share Posted June 30, 2009 Right then.FFS! How long did the last recession last? At least, AT LEAST 6 years. There seems to be an awful lot of uncertainty about the inevitable. Pumping a a few million roll-on-roll-off waste skips full of money into any economy will result in a short term blip 'return to normal' good times. How long can that last? Not very. . . . and so reality bites. The last house price crash lasted something like 6 years but recent recessions have tended to be much much shorter..... mind you house price crashes are rarely the same in depth and length and recessions can be longer. I've yet to see a really compelling argument to say how long or deep either this recession or this housing crash will be. Quote Link to comment Share on other sites More sharing options...
Joey Buttafueco Jr Posted June 30, 2009 Share Posted June 30, 2009 The last house price crash lasted something like 6 years but recent recessions have tended to be much much shorter Which recent recessions? Quote Link to comment Share on other sites More sharing options...
Guest Parry Posted June 30, 2009 Share Posted June 30, 2009 This is, IMHO, a real possibility. However I would like to know what you think will turn the sh1t round?Looking forward that kind of distance the demographic timebomb will have gone off and rising costs of care for the elderly will be dragging down any attempt by the government of the day to cut welfare costs. Furthermore the general loss of equity by Britain's householders will exacerbate that trend as fewer people find their property is enough to cover care costs. Then factor in the massive tax rises needed to pay for the huge sums of money being borrowed now, plus the massive tax rises needed to pay for the environmental changes (whether you accept the real need or not - they will happen so must be paid for) like carbon capture on the coal fired power stations. Also in 15 years time we must begin to look at the oil prices (assuming we are still allowed to burn it ). Surely by then the extraction and prospecting costs will have pushed up prices. I really am at a loss to see where the turning point is simply because the baby boomer generation has screwed the planet over so much at the expense of their kids and grandchildren. One answer is 70s style inflation I guess and that is another real possibility. But this again will destroy people's pension provisions (most are already rather poorly as far as I can see from what I read). So we are agreed about the sh1t but I'd like to know what you (or anyone else) thinks will turn it into lovely compost to grow nice new green shoots in? What will turn this round. 1. Realisation of what is actually required to sustain a comfortable yet highly efficient life in the future. 2. Design it. 3. Organise it. 4. Get building it now. Look what the Victorians achieved and without tower cranes and excavators. Concentrate on, Energy Water Food production Efficient transport Proper recycling and resource conservation That would be a start. Plenty of very clever engineers, scientists and agronomists in the UK. Get the idiot politicians and bankers out the way and let these people do what they do best. Everyone can join and get paid and create the necessary ways and means for the future. Other than that, the UK can wallow in all this bu!!sh1t about shuffling bits of paper and 'giving money' to all and sundry until that 'money' is worthless only to hear the cries of children 'Daddy, I'm hungry' in the not so distant future. Reality. Face it now. Quote Link to comment Share on other sites More sharing options...
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