Wednesday, April 9, 2008

Can’t call it a recession yet…

Broader, deeper, longer slowdown

"The UK has been hoping that as consumer spending slows, a weaker pound would boost manufacturing exports to other countries, thus rebalancing the economy" - and flocks of pigs will soar on high...!

Posted by uncle tom @ 04:38 PM (1202 views)
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18 thoughts on “Can’t call it a recession yet…

  • “What can be done?”

    plenty actually. The first step however is to turn to new people with new ideas.

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  • firstly get rid of that unelected moron at number 10 and frog march Vince Cable to sit in the seat of ultimate responsibility. He has many faults, being an MP is one obvioulsy, but he seems to have the vision and the strength of character that could, just about, pull the country back from the brink of all out sh*te. He needs clever minds around him, George Osbourne perhaps, as NULAB have nicked most of his ideas. I recommend a hung parliament.

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  • Even if things carry on as they are it will probably take two years before the government accepts we are in recession. Even in the US where things are absolutely tanking, they are still arguing the point.

    Personally I couldn’t give a hoot whether or not people agree we are in economic recession, as long as house prices drop hard.

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  • “What can be done?”

    The status quo is beyond redemption – the government will have little option but to slash spending dramatically – and that will cause substantial unemployment.

    A difficult time lies ahead.

    The only little glimmer is the fact that this now looks like coming to a head before the next election – which will enable the Tories to formulate and campaign on a sensible recovery plan instead of having to talk in vague generalities – so instead of promising to keep to Labour’s spending plans, they can catalogue the outrageous waste this government has indulged in, and openly pledge to sack Labour’s ‘5-a-day outreach workers’ – for example…

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  • do not equally clever minds lie outside government… or like in the classroom. are we waiting for the teacher to approve the assignment?

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  • bystander,

    My preference is for the return of William Hague – a bit of bluff no-nonsense Yorkshire common sense would be much better than a bunch of old Etonian toffs.

    As for Vince – well, the Libdems may get squeezed into near oblivion at the next election, so there’s little chance of getting your man – not unless he crosses the floor.

    His seat (Twickenham) is only moderately safe, and could fall to the Tories if there’s a landslide in their favour.

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  • Ah! Yes, but are these minds as Devious?

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  • “The government argues that its relatively low government debt, and low inflation, provide scope for further action, especially by the Bank of England in cutting interest rates”
    I keep reading about “relatively low government debt”. From the figures I have seen, the Government seem to have borrowed something like £35bn a year for the last 10 or 11 years, with something like £40bn this year. I thought they were coming close to the limit that could be borrowed.
    Would someone be kind enough to clarify the Government lending situation? Thanks.

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  • I too like Vince Cable. He at least was offering a critique of the banks before it became fashionable to talk about ‘reckless lending’. However yesterday he was quoted as saying that ‘without govt intervention’ a huge amount of families would be repossessed. What does he mean by this and want ‘intervention’ does he have in mind ? Don’t think it will be too long before many on this site will be criticising him as the Lib Dems can’t see a bandwagon – distressed families at mercy of banks- without jumping on it.

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  • An Bearin Bui says:

    A weaker pound could boost manufacturing exports to other countries??? Are they living in 1976? Are they on crack? There ARE no manufacturing exports anymore from the UK. Apart from a few cars, some natural resources and some clothing there is NOTHING that the UK exports. The economy is 70% dependent on domestic consumption for its growth. Honestly someone with economic qualifications needs to educate the BBC journalists – the UK is not like the USA in all respects. The USA still has some manufacturing base and some highly successful multinationals e.g. Google, Apple, Intel that are HQ’ed in the USA. The UK doesn’t have that luxury of a real economy and can therefore not afford to let its currency devalue.

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  • Happy Mondays says:

    Ah! Yes, but are these minds as Devious?

    Of course! They all have a self serving interest, and will say and do anything that please joe public just to get voted in, so they can have a jolly good knees up back at the old boys club..What we have not got is any new ideology parties out there, same sh*t different angle thats all we have! It will take something on a masive scale to make us all think that maybe there is another way and maybe this could be the start of it…

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  • The answer has never, ever, been with politicians – they are mouthpieces. Part of the problems we face today is them thinking they can be more than that (witness the government ignoring their own panel of experts on drugs). Tony Blair like to think he was the saviour of Northern Ireland, but in reality it was the civil servants that did the real work. Neither is it the private sector – they are only concerned with ways to make money. Most innovation, ideas and real change originates in the public sector – research at universities etc.

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  • I agree with bystander, a hung parliament is best. Preferably from the tallest yardarm or gibbet available.

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  • I agree with bystander, a hung parliament is best. Preferably from the tallest yardarm or gibbet available.

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  • “The UK doesn’t have that luxury of a real economy and can therefore not afford to let its currency devalue.”

    Couldn’t agree more, An Bearin Bui, the BoE will achieve two things both of which will cancel out the other: 1) The government will look like it cares about the general public and is trying, through the BoE, to do its best to make life easier through lowering borrowing costs and trying to keep up the feel good factor. 2) the continued devaluing of sterling will import high inflation and, since the government has now managed to blackmail most of the public sector workers into accepting a way below inflation pay increase held over three years, the cost of real living (not some fictitious CPI related cost of living), will sky rocket, perhaps this is what Mr KIng meant when he said the standard of living of the British people was going to suffer and he might have to rite a letter to the chancellor. (Personally I reckon he’s going to have to write a couple at least, and then lift interest rates so fast it’d make you dizzy). Oil reached $112 today and sterling dropped to euro 1.24. We import most of our goods, food, oil etc through and from Europe so it is about to become very, very expensive to live in the UK, rather than just very expensive. I notice the BBC and Sky news briefly touching on the euro’s rise, saying it will cost more when the Brits go on holiday. The Euro’s unstoppable rise against sterling is going to do a lot more damage to the economy than making a few sangrias more expensive.

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  • Even the scots are turning on Gordo:

    http://thescotsman.scotsman.com/uk/Don39t-panic–says-Brown.3960694.jp

    I agree with bystander, Vince is astute and more robust, he is sensitive and understands the situation. That must put him ahead of Gordo and Captain Darling.

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  • gone-to-colombia says:

    Sad to ´say I agree with much of what´s been said here, and I´m on the left of politics. Brown has been a disaster, he makes Blair seem much more attractive.
    Though, you here might not agree with me.
    The real tragedy is that none of them have much idea, they all seem to me to be part of the problem.

    This could be a good time for a government of all the parties.
    or
    A government of none of them.

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  • Naturally the impending rate cut will see the pounds’ downward spiral against the Euro continue.

    I suppose the falling pound may aid the manufactuing sector on one hand, though they may find labour issues becoming more problematic
    One unintended consequence I suppose, is that the recent high levels of migration we have witnessed may simply dry up, or even reverse. The downward pressure on wages (holding back inflation) may be lifted. The pound in your pocket just doesn’t provide the same against the Polish Zloty anymore.

    Oh well, perhaps all this is some great plan leading to our Euro participation. When one pound hits one Euro we may all well join for simplicity’s sake.

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