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K P M G: More Than Half U K Businesses Will Cut Jobs

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http://business.timesonline.co.uk/tol/busi...icle4407544.ece

The Sunday Times July 27, 2008

Warning that UK economy is heading into recession
David "Dave" Smith, Economics Editor
THE economy is heading into recession and may face a slump on the scale of the early 1990s, according to Deloitte, one of Britain’s leading accountants. Another,
KPMG, says more than half of businesses are planning job cuts.
Deloitte’s quarterly economic review examines the effect of the lower pound on industry and asks whether export-led growth will prevent a severe downturn. Roger Bootle, its economic adviser, believes it will not. He said: “While the sharp fall in the UK exchange rate seen since last summer should eventually lead to a period of better-balanced growth, like that enjoyed in the mid-1990s, it won’t prevent the credit crunch and a sharp retrenchment in corporate spending from sending the economy into recession.”
After figures on Friday showed that quarterly growth had fallen to 0.2% in the second quarter of this year, Deloitte says a “technical recession” of two or more consecutive quarters of falling gross domestic product is now all but guaranteed. “A full-blown slump like the early 1990s is not impossible if the labour market crumbles or interest rates end up rising rather than falling,” the report says.
It predicts that the Bank of England will be forced to cut interest rates to 3.5% next year, from 5% now, but even this will not be enough to bring about an early recovery.

The credit crunch ushered in a sort of "phoney war" where all around was collapsing but not many actually felt it. That is about to change as the next and inevitable phase of the Big One kicks in with job losses as a reaction to plummetting confidence, lack of invesment and the demise of Gordon's economic engine of growth: HPI.

Sterling has resisted selling pressure becauise we have the highest IR in the G8. With recession 100% certain and guaranteed that too will change in the months ahead. Too late now to sell builder stocks but not too late to hedge against a crashing pound.

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This is BIG news.

all was fine and dandy when the money(illusory or otherwise),was floating around the economy.

It doesn't even have to be a direct redundancy to totally sieze up spending,it's just the FEAR that will do it.

Companies have to inform employees of their plans under EU law now...so when the "at risk" notice comes,EVERYBODY will immediately tighten belts.

contractors can get laid off pretty quick already,and many of these construction workers are immigrant,so they will just go home.

....BTL is going to take one hell of a kicking when this lot takes full effect.

fat lady heard warbling in dressing room.

curtains 5 minutes!

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Guest Winnie
http://business.timesonline.co.uk/tol/busi...icle4407544.ece

The Sunday Times July 27, 2008

Warning that UK economy is heading into recession
David "Dave" Smith, Economics Editor
THE economy is heading into recession and may face a slump on the scale of the early 1990s, according to Deloitte, one of Britain’s leading accountants. Another,
KPMG, says more than half of businesses are planning job cuts.
Deloitte’s quarterly economic review examines the effect of the lower pound on industry and asks whether export-led growth will prevent a severe downturn. Roger Bootle, its economic adviser, believes it will not. He said: “While the sharp fall in the UK exchange rate seen since last summer should eventually lead to a period of better-balanced growth, like that enjoyed in the mid-1990s, it won’t prevent the credit crunch and a sharp retrenchment in corporate spending from sending the economy into recession.”
After figures on Friday showed that quarterly growth had fallen to 0.2% in the second quarter of this year, Deloitte says a “technical recession” of two or more consecutive quarters of falling gross domestic product is now all but guaranteed. “A full-blown slump like the early 1990s is not impossible if the labour market crumbles or interest rates end up rising rather than falling,” the report says.
It predicts that the Bank of England will be forced to cut interest rates to 3.5% next year, from 5% now, but even this will not be enough to bring about an early recovery.

The credit crunch ushered in a sort of "phoney war" where all around was collapsing but not many actually felt it. That is about to change as the next and inevitable phase of the Big One kicks in with job losses as a reaction to plummetting confidence, lack of invesment and the demise of Gordon's economic engine of growth: HPI.

Sterling has resisted selling pressure becauise we have the highest IR in the G8. With recession 100% certain and guaranteed that too will change in the months ahead. Too late now to sell builder stocks but not too late to hedge against a crashing pound.

This key looming factor will make any £90bn housing rescue package utterly impotent. Once the lagging indicator of unemployment really kicks in all bets are off. HPC will reach the speed of light by Xmas.

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It predicts that the Bank of England will be forced to cut interest rates to 3.5% next year, from 5% now, but even this will not be enough to bring about an early recovery.

I thought that the general opinion on this forum was that interest rates were going to increase next year - does this indicate that KPMG are perhaps predicting deflation?

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I thought that the general opinion on this forum was that interest rates were going to increase next year - does this indicate that KPMG are perhaps predicting deflation?

The money supply will continue to increase regardless of the base rate due to the sheer scale of the BoE bailouts of insolvent usurers.

Edit: the BoE base rate only affects the credit supply anyway - it does not affect the supply of money (legal tender).

Edited by InternationalRockSuperstar

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Was wondering when the 2 phase of the crunch would set in, up to yesterday I had not heard on one person I know losing their job then 3 all at once.

1st one was a printer who got standard redundancy plus his pension(25 years employed gives him £165 a month :o )

2nd one was a manager at a bottle gas supply company for the licensed trade, 10 yrs employed standard redundancy no pension offered as he is under 50

3rd one was a guy at a company who supplied temp cabins etc to building sites , standard redundancy no pension.

All of these guys have mortgages and other other commitments, while the bankers of this world who have been paying themselves millions in unearned bonus and massive salaries are sitting very comfortably indeed not worrying about the carnage they have helped to create, but I suppose someone had to pay for their greed.

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This might be a first chunk..... this si only business trying to save their own skin.

When they loose the skin insolvency and redundancy without the payments coudl well set in.

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Very large transport company i now work for had already started cutting back on staff numbers when they took us over recently, they have now given 30 days notice to 3 depots that they will be shutting and the staff made redundant.

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This might be a first chunk..... this si only business trying to save their own skin.

When they loose the skin insolvency and redundancy without the payments coudl well set in.

The thing is,the tax-take is so high on most people,there is a limit to what people will bear.Attempts will be made to raise taxation by stealthy means for sure,but this hits the workers hardest.

the productive workforce is already very low,so if people were to rebel it could take the entire public sector/welfare system down.Chavs without dole money are going to be our new nationalist army.

Building a police-state is all very well but the police will soon turn on their masters if they can't put food on the table.

Edited by oracle

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If the government has money to spend, it should be used to invest in future employment.

It makes no sense whatsoever to prop up the high cost of housing and accommodation. Cheaper living expenses will put more money in peoples' pockets and reduce inflation (should housing be included in cost of living index), thus limiting the need for large increases in wages.

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If the government has money to spend, it should be used to invest in future employment.

read my above post.

WHY does the government have the money to spend if we do not give it to them.

The government have been spending YOUR money to create a benefit-dependent society.

the pool of benefit junkies creates mass unemployment,which then gets used to depress wages.

IT'S YOUR MONEY....ARE YOU HAPPY PAYING FOR YOUR OWN SERVITUDE??

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I thought that the general opinion on this forum was that interest rates were going to increase next year - does this indicate that KPMG are perhaps predicting deflation?

Gordon's HPI bubble was filled with a gas know as "credit." When the gas is removed from the bubble it "deflates." IMO deflation will follow the last gasps of the miracle economy which are being manifested in inflated prices for fuel, food and goverment services (council tax--to pay the highly inflated government 6 figure salaries). Recession, lack of credit and mass unemployment will be a quick and devastating cure for rising prices. I can see our economy going Japanese for a couple decades. 2 trillion pounds has or is in the process of vanishing from the bubble. All or most of it the last decade's worth of HPI.

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Government spending is like giving someone a blood transfusion from his left arm to his right arm and in the process spilling some of the blood onto the floor.

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deflation will follow

In a fiat monetary system? Are you serious?

I can see our economy going Japanese for a couple decades.

Perhaps you're not aware that Japanese M1 more than doubled during the 1990s :P (when the mainstream media kept telling everyone that Japan was experiencing a 'deflationary recession')>

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Gordon's HPI bubble was filled with a gas know as "credit." When the gas is removed from the bubble it "deflates." IMO deflation will follow the last gasps of the miracle economy which are being manifested in inflated prices for fuel, food and goverment services (council tax--to pay the highly inflated government 6 figure salaries). Recession, lack of credit and mass unemployment will be a quick and devastating cure for rising prices. I can see our economy going Japanese for a couple decades. 2 trillion pounds has or is in the process of vanishing from the bubble. All or most of it the last decade's worth of HPI.

Apart from that........are we alright ? :blink::blink:

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  • 399 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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