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Qe 'could Be Back' As Officials Say Recession Was Worse Than Thought

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http://www.independent.co.uk/news/business/news/qe-could-be-back-as-officials-say-recession-was-worse-than-thought-8677712.html

The UK's great recession was considerably greater than previously thought and the recovery's momentum is looking weaker, according to official figures released yesterday.

The Office for National Statistics reported that the economy narrowly avoided a double-dip recession last year after statistical revisions, but the more significant revisions related to output in 2009.

In the first quarter of that year the ONS says that the economy contracted by a massive 2.5 per cent, significantly more than its previous estimate of a 1.5 per cent contraction. That means that over the course of the 2008-2009 great recession the economy shrank by 7.2 per cent, rather than 6 per cent as previously thought.

The revisions to the path of output since 2010 were comparatively minor, with the result that the economy is now 3.9 per cent below its peak in the first three months of 2008. Until yesterday the gap had been estimated at 2.6 per cent.

And yesterday all the focus was on the fact we avoided a "double dip" in the depression.

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And yesterday all the focus was on the fact we avoided a "double dip" in the depression.

They'll make up their mind one day, and meanwhile reality will continue without them.

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Because the recession 5 years ago was worse than thought, we need QE now?

Yes, you see....hmm....un-patriotic comments like these are not allowed!!!!

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Just as well imputed rents saved us from an even worse fate. It's a startlingly successful growth industry.

What the government needs to do then is start demolishing houses, this will create a shortage, drive rents (and hence imputed rents) up and boost the economy.

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More QE won't fix the underlying issues as the benefits go to the top 10% who then push up costs for the bottom 90% thus compounding the issue.

Quite the opposite:

QE is designed for precisely that,and that is what the "elites" want.

Sheeple are not interested in getting the salary (actual money), they are interested in getting the debt (phoney money).

They will never understand that they have already earned the money which is shoved down their throats as-debt.

Hence, both "elites" and sheeple are overjoyed with the new prospect of QE.:ph34r:

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Just as well imputed rents saved us from an even worse fate. It's a startlingly successful growth industry.

/imputed-rents-in-the-national-accounts.pdf‎

http://www.ons.gov.uk/ons/about-ons/what-we-do/FOI/foi-requests/business-and-energy/imputed-rents-in-national-accounts--more-information-/index.html

The paper is classed as discontinued, no idea what that means.

Following the abolition of domestic rates, a new

United Kingdom methodology was developed which had the added benefit that it met the more specific requirements of the European System of Accounts 1995 (ESA 1995). The methodology combines the number and type of owner-occupied dwellings, as measured in the census, with the results of a hedonic model of rents.

FOI request: Imputed rents in national accounts (more information)

Request

I’m referencing an ONS paper Imputed Rents in National Accounts (economic trends april 2005 Craig Richardson Margaret Dolling). It is very clear but it does not explain how the imputed rents are treated when GDP is presented as ‘constant prices’ or otherwise adjusted for inflation. I only need reference to a document if that is easier and I can work through it but Search hasn’t turned up anything.

Response

In response to your Freedom of Information request I have provided a description of how “imputed rentals” are treated when presenting GDP estimates as constant prices (adjusted for inflation).

The data used in the ONS owner occupier (imputed) and actual rental models are based on information provided by the Department for Communities and Local Government (DCLG) for the stock of dwellings, and rental prices by tenure type are taken from the Living Costs and Food survey (LCF).

Current price expenditure in the base year for each of the broad tenure types (public sector, housing associations, private furnished rented, private unfurnished rented, owner occupied and rent free), are estimated using average number of rooms and average rent per room.

To create imputed rental volume estimates from current prices, a volume index (with the National Accounts base year as 100) is created from the number of occupied dwellings.

The volume index is subject to a 'quality' adjustment, representing general improvements over time to existing properties, in the volume calculations. This is taken as a 0.43 per cent increase per annum in the overall quality of the housing stock. This accounts for rental price inflation caused by a rise in quality. This factor is applied cumulatively each year.

The quality adjusted volume index is then multiplied by the annual current price in the base year, before being divided by 400 to produce a quarterly volume series.

Where possible, ONS tries to provide information on the sources and methods used in producing statistical estimates on the ONS website. Further information on estimates contained in Household Expenditure can be found at

http://www.ons.gov.uk/ons/guide-method/method-quality/specific/economy/consumer-trends/index.html

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Just as well imputed rents saved us from an even worse fate. It's a startlingly successful growth industry.

The only justification I have seen for including imputed rents in GDP measures is that it improves comparisons between countries with different percentages of dwellings in rental, OO etc.

What would be much simpler, while enabling fair international comparisons, would be to strip out real rents from the figures.

Q

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  • 246 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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