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Is Brown Banking On Economic Miracle?

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Nice article to ponder :-

Until recently Britain, which is outside the euro zone, shone as the only economic bright spot in Europe. But few economists believe the British economy can avoid a sharp fall to earth. Ominous signs are gathering. Now Britain needs an economic miracle to balance the books--and that appears to be what Chancellor of the Exchequer Gordon Brown is banking on to save things.

Forgetting the prudence he preached a few years back, Brown has been racking up billions more in government debt. Despite rosy forecasts, government borrowing is increasing fast, and not all of it can be blamed on the costs of the Iraq war. The chancellor's predictions of what the Blair government would need to borrow for this year have been way out of focus. As a result, the government has had to impose highly unpopular new taxes. The housing-price boom appears to be petering out and inflation is marching to a five-year high.

That was the case put forward on in April 2003 when we were due a recession after Iraq, what happened after that article was published? Yup, you've guessed it, interest rates slashed to 3.5%. The change from RPI to CPI also occured in December of that year.

So that put off the day for nearly two years, not bad, what happens if I ignore my hang over and continue drinking like never before? Things can only get better I suppose.

This is the over shooting that occurs with all bubbles, shame the BoE action and change of inflation measures was the single roll of the dice.

Edited by BuyingBear

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  • 301 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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