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ralphmalph

Global Recssion Over - Imf States

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http://www.marketwatch.com/story/recovery-...-imf-2009-08-18

Just released.

I suspect their last missive about a month ago said "Recession to deepen."

Then the one before that said "Give us some more money to print."

So the IMF are blowing with the wind in thier missives in my opinion.

Having said that I do think the UK economy is in better shape than most think.

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Having said that I do think the UK economy is in better shape than most think.

ok malph, so when do interest rate's rise to reflect this convenient position we find ourselves in...?

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http://www.marketwatch.com/story/recovery-...-imf-2009-08-18

Just released.

I suspect their last missive about a month ago said "Recession to deepen."

Then the one before that said "Give us some more money to print."

So the IMF are blowing with the wind in thier missives in my opinion.

Having said that I do think the UK economy is in better shape than most think.

Because they have just been given the keys to the printing presses so they can pocket whatever they like - they are now officially rich so what do they care.

I can see global handouts of money based on who given the biggest back-handers - it stinks to high heaven.

I got money - FU says the IMF - global recession is over (for us).

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12 to 18 months.

help me out here, so how many months/years in total would that be with rates at 0.5% based on the lengthier end of that prediction ?

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http://www.marketwatch.com/story/recovery-...-imf-2009-08-18

Just released.

I suspect their last missive about a month ago said "Recession to deepen."

Then the one before that said "Give us some more money to print."

So the IMF are blowing with the wind in thier missives in my opinion.

Having said that I do think the UK economy is in better shape than most think.

Bad News for Brown as IMF says Britain's debt crisis is the worst among major economies

By Kirsty Walker

01st August 2009

Britain will have the biggest debt of any major economy next year, according to the International Monetary Fund.

The Government budget deficit will soar to £191billion, the Washington-based organisation has warned.

The figure - which equates to £7,600 for every family in Britain - is far higher than the Treasury's official forecast of £175billion.

Recession Will be the Worst In British History BOE Confirms

The economy will take longer to recover from this recession than it did in previous economic slumps and it will take “several years†before banks are lending normally to households and businesses, Mr King said......

.....Unveiling the economic forecasts, Mr King said that the Bank was doing everything it could to ensure that Britain did not follow in Japan’s path and succumb to a “wasted decade†of economic stagnation.

But he indicated that the financial crisis had been of a scale that rivalled anything previously witnessed in history. “We’ve been through an extraordinary financial crisis,†he said.

“One doesn’t need to ask questions about 'the worst since when’ since it may be hard to find any period in which it was actually worse.â€

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help me out here, so how many months/years in total would that be with rates at 0.5% based on the lengthier end of that prediction ?

it is 12 to 18 months from now. What do you need help on?

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it is 12 to 18 months from now. What do you need help on?

sorry, what i meant was in total for how many months would interest rates be at 0.5% if we included the fat end of your prediction ? don't worry i've looked it up....

So after several months of cuts the BoE cut to a low of 0.5% in March of this year, to the point where traditional monetary policy becomes ineffective. So that would be less than 2 years in total of rates at 0.5% based on your prediction, i can't see it personally.

central banks can jawbone all they like about returnign rates to 'normal' levels when conditions improve, but the example of japan has proved you can effectively maintain a ZIRP for years ......and i don't see how we can go from fighting deflation to inflation expectations in such a short period of time when capacity is predicted to be what it is over the next few years, i'm not sure how inflation can be the fear to the point where interest rates rise any meaningful amount.

Edited by spivtastic

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and i don't see how we can go from fighting deflation to inflation expectations in such a short period of time when capacity is predicted to be what it is over the next few years, i'm not sure how inflation can be the fear to the point where interest rates rise any meaningful amount.

One scenario with rapid inflation would be if Sterling fell sharply. I think it could happen after the coming election if there was a hung parliament.

Another scenario is if QE is extended. It is only possible to print 10% odd of GDP for so long before inflation picks up.

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One scenario with rapid inflation would be if Sterling fell sharply. I think it could happen after the coming election if there was a hung parliament.

Another scenario is if QE is extended. It is only possible to print 10% odd of GDP for so long before inflation picks up.

Certain actions reap certain consequences. ;)

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http://www.marketwatch.com/story/recovery-...-imf-2009-08-18

Just released.

I suspect their last missive about a month ago said "Recession to deepen."

Then the one before that said "Give us some more money to print."

So the IMF are blowing with the wind in thier missives in my opinion.

Having said that I do think the UK economy is in better shape than most think.

Is this just a hunch or have you some evidence. Maybe you think the UK Government will borrow less than the £175bn they estimated for this year?

Business in the firm I work for has not just slowed, it has fallen off a cliff. I cant see a recovery any time soon.

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Guys, being an avid bear I hate to admit this, but I do like to recognise the facts.

My suspicion is that the World's financial authorities have successfully engineered one last temporary escape from the long term deleveraging and financial collapse that will at some point ensue. It's as if every boom bust cycle requires lower interest rates and more stimulus than the last.

I reckon this time we may well see some rather positive looking global numbers and perhaps with the China and the developing nations picking up the slack and the US and UK being in the dogs for a while. We'll probably see another dose of HPI some time after unemployment levels off (I'd say 12 months) - but and this is the essence of my point, the system has not yet been cleaned out. The over indebtedness will have not gone away and so whilst there may be a short period of feeling good again and borrowing more I am pretty confident the dark clouds will again return and when they do I doubt the monetary authorities will have anything left in the arsenal other than to go for outright inflation.

Of course this outright inflation may happen earlier. Whilst the case for deflation has reappeared in some recent numbers, the monetary authorities have been doing their best to stoke inflation with QE and low interest rates. I recall from school economics that interest rate changes normally took 12-18 months to feed through, so I don't think we are quite there yet.

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Guys, being an avid bear I hate to admit this, but I do like to recognise the facts.

My suspicion is that the World's financial authorities have successfully engineered one last temporary escape from the long term deleveraging and financial collapse that will at some point ensue. It's as if every boom bust cycle requires lower interest rates and more stimulus than the last.

Yip agreed, i was just about to write something with the same sentiment but less clarity.

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Guys, being an avid bear I hate to admit this, but I do like to recognise the facts.

My suspicion is that the World's financial authorities have successfully engineered one last temporary escape from the long term deleveraging and financial collapse that will at some point ensue. It's as if every boom bust cycle requires lower interest rates and more stimulus than the last.

I reckon this time we may well see some rather positive looking global numbers and perhaps with the China and the developing nations picking up the slack and the US and UK being in the dogs for a while. We'll probably see another dose of HPI some time after unemployment levels off (I'd say 12 months) - but and this is the essence of my point, the system has not yet been cleaned out. The over indebtedness will have not gone away and so whilst there may be a short period of feeling good again and borrowing more I am pretty confident the dark clouds will again return and when they do I doubt the monetary authorities will have anything left in the arsenal other than to go for outright inflation.

Of course this outright inflation may happen earlier. Whilst the case for deflation has reappeared in some recent numbers, the monetary authorities have been doing their best to stoke inflation with QE and low interest rates. I recall from school economics that interest rate changes normally took 12-18 months to feed through, so I don't think we are quite there yet.

Most say we are going to follow Japan. This is what the Japanese have been doing for 20 years, covering the cracks in an endless decline.

Those in power where never going to left everything implode.

Even Mervyn King said prepare for lower living standards over the coming years, this is exactly what will happen. A slow decline so the majority of people don't realise until it's too late.

That doesn't mean to say a nasty shock couldn't undermine the entire system, but I expect in the majority of cases this would be managed and damage limited.

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My suspicion is that the World's financial authorities have successfully engineered one last temporary escape from the long term deleveraging and financial collapse that will at some point ensue. It's as if every boom bust cycle requires lower interest rates and more stimulus than the last.

Maybe the world is fine for now.

However I don't see there is a way for the UK to ignore reality for much longer. The national debt is rising at a worrying pace. There is little prospect of taxes recovering to close the budget deficit, instead there is the certainty of additional spending on stimuli and increased unemployment. The economy is contracting even with 10% odd of GDP in printed money thrown in. I could be missing something fundamental, but what is more likely: i) return to a "virtuous" circle of rising asset prices, tax take, and employment, or ii) a circle that goes the other way starting with 10+ percent of the public sector departing for the dole queue?

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Guys, being an avid bear I hate to admit this, but I do like to recognise the facts.

My suspicion is that the World's financial authorities have successfully engineered one last temporary escape from the long term deleveraging and financial collapse that will at some point ensue. It's as if every boom bust cycle requires lower interest rates and more stimulus than the last.

I reckon this time we may well see some rather positive looking global numbers and perhaps with the China and the developing nations picking up the slack and the US and UK being in the dogs for a while. We'll probably see another dose of HPI some time after unemployment levels off (I'd say 12 months) - but and this is the essence of my point, the system has not yet been cleaned out. The over indebtedness will have not gone away and so whilst there may be a short period of feeling good again and borrowing more I am pretty confident the dark clouds will again return and when they do I doubt the monetary authorities will have anything left in the arsenal other than to go for outright inflation.

Of course this outright inflation may happen earlier. Whilst the case for deflation has reappeared in some recent numbers, the monetary authorities have been doing their best to stoke inflation with QE and low interest rates. I recall from school economics that interest rate changes normally took 12-18 months to feed through, so I don't think we are quite there yet.

I tend to agree, but this time, I feel it will happen without massiva wage inflation to put things right!

its will be long and drawn out!

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