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dubsie

Double Dip (What Are The Odds)

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VAT increases, rising fuel duty, rising unemployment, inflation and the possibility of interest rate rises.....surely this will lead to another downturn. I can't see how we can avoid another recession when conditions are already very poor.

We must also factor in the cost of widespread industrial action and the possibility of fuel strikes....surely the UK is going south.

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If it looks that bad, I'd better give you some money to spend... ;)

VAT increases, rising fuel duty, rising unemployment, inflation and the possibility of interest rate rises.....surely this will lead to another downturn. I can't see how we can avoid another recession when conditions are already very poor.

We must also factor in the cost of widespread industrial action and the possibility of fuel strikes....surely the UK is going south.

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Yes but what does 'recession' mean anyway?

Recessions are soooo over rated.

You sure you don't mean it's recoveries that are overrated?

At least you know when you're in a recession.

And the answer to the OP's topic question is . . . every chance. 110% at least.

After all, we have the double dipsticks in power.

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Yes but what does 'recession' mean anyway?

1% fewer transactions - so what?

I personally believe it is the quality of activity that matters - not the degree to which that measure of transactions, gdp, goes up or down.

Recessions are soooo over rated.

On a quality adjusted measure of activity, much of the West has probably been in a recession since the mid to late 1960s.

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I am still reckoning on a stagnant, slow, grinding housing market. Buyers and sellers continuing to stare each other out and things only moving at a glacial pace in terms of nominal prices. Meanwhile inflation will be left to do the dirty work. The UK has been here before and will no doubt do the same again, in particular it is not so much about fixing the housing market, but more about getting out of all those future pension liabilities.

The only thing that will change this is something dramatic and compelling happening on interest rates, but I don't think this will occur for quite sometime and certainly not until either buyers with mortgages have repaid sufficiently that they have a large equity buffer or because the market has risen again in nominal terms (though lower still in real terms) such that that same buffer is created. My rationale for this is that the banks are insolvent the moment large numbers are in negative equity, and so given who is really running the show I can't see this happening. We will get lots of contrary noises, but this is all about the banks not taking a haircut.

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Yes but what does 'recession' mean anyway?

Succinctly, it means that the real returns available on reinvested capital are tending toward the negative.

A cash generating producer can either reinvest, throw off dividends, or buy back equity.

Only one of these is likely to reduce the long run cost of production of the good or service under the microscope.

It also happens to be the one that will retain (or increase) labour participation.

If you will, a recession is a tilt toward (an economic imperative for) rent-seeking behaviour on a national (or perhaps global) scale.

Which at an individual level is fine - if you already have capital, and have adequately hedged the risks to it.

It's not so benign a prospect if you're looking to acquire it, though.

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VAT increases, rising fuel duty, rising unemployment, inflation and the possibility of interest rate rises.....surely this will lead to another downturn. I can't see how we can avoid another recession when conditions are already very poor.

We must also factor in the cost of widespread industrial action and the possibility of fuel strikes....surely the UK is going south.

Lots more money printing should ensure that markets stay up and the banks stay very profitable, keeping the elite comfortably rich - Which is all that those in power 'care' about really.

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VAT increases, rising fuel duty, rising unemployment, inflation and the possibility of interest rate rises.....surely this will lead to another downturn. I can't see how we can avoid another recession when conditions are already very poor.

We must also factor in the cost of widespread industrial action and the possibility of fuel strikes....surely the UK is going south.

You could have said exactly the same things 12 months ago and yet the economy started to grow.

The economy naturally grows 0.5 or 0.6% a quarter and you can add a further 0.1 or 0.2% for rising population.

Of course their will be variations within th economy. People in export manufacturing should do much better than those in discretionary wealth consumption for example.

If the economy does fall into another recession, which is unlikely but possible if there are adverse efects from the rest of the world, then there will be even more tax rises and spending cuts with big drops in living standards.

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  • 312 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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