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It was all just a bad dream

So, that was it. The worst recession in living memory is, if you believe the latest government think tank reports, now over. The recession that Alistair Darling said would be the worst for 60 years (and he recently revised that estimate upwards to 100 years) has passed with nary a whimper in real terms. True, if you lost your job in the last year or so then you might not see it as being a particularly benign period of history, but really, as these things go, this has been ‘recession lite’, a recession for the generation that doesn’t dorecessions. Which, of course, makes me and Lance look a bit silly. Having correctly predicted that the recession would actually...

posted on: Jun 10, 2009 | author: Alex

Basic guide to Quantitative Easing

This is an article that I could have written a few months ago, when the Bank of England stated its intention to begin ‘queasing’. But it has become rather more relevant now that one of the pronouncements of the G20 summit is that the International Monetary Fund (IMF) will itself begin to ‘print’ additional SDRs (Special Drawing Rights, effectively the IMF’s own currency) which its contributor countries can draw down in the shape of dollars, euros, etc. Note my use of the word ‘print’ in the above paragraph. The days when first world countries used the printing press to increase the volume of money in circulation have long gone, assigned to eras such as Weimar Germany. Paper and...

posted on: Apr 4, 2009 | author: Alex

Deflation or inflation – what will happen in the UK?...

I’ve written in a previous article about the various concepts involved in economic inflation and how it can affect the value of your money, your wages and the things you buy. The opposite of inflation is deflation, which I’ll explain in this article before going on to discuss the probable and possible situations in the UK for the next few years. The ‘deflation versus inflation’ argument is more important in the UK today than it has been at any time in the last 30 years, so it’s worth thinking about in some depth. So, deflation. If inflation is a general increase in prices and/or wages driven by the greater availability of money (whether ‘real’ money or debt), then...

posted on: Dec 6, 2008 | author: Lance

Government abandons its own golden rules on borrowing and debt...

You might remember that about ten years ago, when the current government was elected, Gordon Brown made a big deal about his strict new rules for government borrowing which were all part of his ‘no more boom and bust’ promise. Anyway, now that we’ve come to the end of the biggest boom in British history and are teetering on the precipice of the biggest bust in British history, Alastair Darling (the guy who replaced Brown when he got bumped up to Prime Minister) has decided that those rules aren’t quite as cast iron as they used to be. Neatly sidestepping the whole issue of the government’s abject failure to deliver on one of its key promises and abandoning...

posted on: Oct 29, 2008 | author: Lance

Darling tells us what we already know: the economy is in big trouble...

“Economy at 60-year low, says Darling. And it will get worse.” So says The Guardian which also quotes the Chancellor as commenting, “People are pissed off with us.” Quite. The penny at last seems to have dropped, with Alistair Darling stating that the economic times faced by Britain and the rest of the world “are arguably the worst they’ve been in 60 years … And I think it’s going to be more profound and long-lasting than people thought.” Based on our independent assessment of the UK economy, we’d agree. In fact we’ve been predicting this perfect storm for some time. Yet again we come back to the simple question: Why, if a couple of hacks on this site and a handful of others around...

posted on: Aug 29, 2008 | author: Alex

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