UK Economy
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The UK's Office of Budget Statistics came out with a report on March 23. The Telegraph has today published a n analytical piece on this report. Some content is worth quoting directly: As a result of higher than expected inflation, living standards will fall for longer than previously anticipated, public borrowing will end up higher, and real terms cuts in public spending will have to be deeper. T...
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Yesterday, news broke that the UK economy actually contracted by .5% in the last quarter of 2010. George Osborne blamed the snow. Ed Balls blamed George Osborne. Yesterday, economists feared stagflation in the UK. Today, Nauriel Roubini, the economist who predicted the 2007 crash, suggested there are chances of a double dip in the UK. Back in December 2009, before it became clear just how much of...
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Folks in the UK are have paid down their mortgages in 2010 with a vengeance . It's understandable that this is so. They are reacting to austerity and to fears of higher interest rates. Nonetheless, it's also throwing away good money, after a grossly overvalued asset. Inflation will cut into cash reserves, no doubt, but cash reserves will matter much more if unemployment strikes. Further, properti...
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The Telegraph has published interesting statistics that point to a sharp drop in he export of financial services out of London in 2010. Apparently, exports are down by GBP 10 Billion. The article itself is right wing, and blames misguided regulation, in particulars, increased Capital Retention Ratios, the so-called squeeze on banker's bonuses and special levies imposed on banks. The article takes...
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David Blanchflower wrote in the Guardian on November 16, arguing that with property prices falling, inflation could come to the rescue of home owners in the UK. He predicts a 20% loss in property prices, I'd go with 50%. I prefer analyzing people first, and rather than number crunching, I studied the point in history when irrational exuberance over property prices began in the UK. This was 1997 ....
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The Daily Mail reported on November 7 that immigration may yet become a flashpoint between the rest of the European Union and Britain, with India thrown plum in the middle of the mix. Brussels and India are rumored to be in the final stages of signing a deal to allow between 35,000 and 50,000 IT workers into EU countries. These workers are to be allowed through the work permit scheme, which means...
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The UK's Works & Pensions Secretary, Ian Duncan Smith, is to announce that those seeking unemployment benefit in the UK, will be asked to do free voluntary work for 4 weeks . Their work placement would be co-ordinated by private companies. Presumably those who receive the benefits of the unpaid service, such as charities, voluntary organizations and companies, will pay fees to the co-ordinators....
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Merrill Lynch has issued a warning that inflation numbers, resulting higher interest rates, and quantitative tightening, will make UK bonds too expensive over the medium term . The UK's follows the US up and down, and UK inflation will therefore, likely cool down within a quarter or 2. So the logic outlined by Merrill Lynch, does not exactly hold. However, sovereign bond holders invest in the eco...
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The UK media is abuzz with the news that the UK's net mortgage lending, not counting remortgages or repayments, has fallen to just GBP 112 Million, far below the GBP 1.62 Billion in August. Comparing September numbers to August would be a mistake though, the mortgage business is highly seasonal. The Council for Mortgage Lenders reported on October 20 that gross mortgage lending for September stoo...
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Unions in the UK are set meet on Monday for a Trade Unions Congress. They aim to strike, launch civil disobedience and generally, resist , the planned public services cuts, to be implemented as part of a Tory austerity drive. In a related thread, the Prime Minister, David Cameron has today written in the Guardian, promising to give power back to the people. Two things struck me about this article...
1 year ago
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