´óÏó´«Ã½

A bit unfair.
Politicians have to be flexible.
They have to be able to take the action required by the circumstances they find themselves in.

Priorities are important, but sticking to arbitrary rules may be worse for the Public than having a little extra wiggle room.

I'm sure there must be historical examples of Politicians of different Parties, rewriting the Rules to fit the new game.

For example Poll Tax.

That was a mean one, with lots of it must be so's and then a complete change of tack coming later.

But that wasn't Labour or New Labour.

Me, I would vote Liberal.

It must be their Turn by now ?

I think the term is desperate men will do desperate things.

Rather than leave the productive part of the economy to do its natural thing i.e the private sector be allowed to grow.

The present administration which has a stench of resigned failure can not see the wood from the trees and is going to give the non productive part of the economy further money to waste without control.

All credibility has now been lost and one can only assume that if your are going to be blown out of the water at the next election you might as well screw up any incumbent with as much garbage as possible.

The abuse which Labour has levied on the British economy will go down in history as the biggest deliberate and unnecessary economic disaster ever.

As has been said, never have so few caused so much damage to so many, Labour must go and rot in hell.

Its time for Money Reform see :-monetaryreform dot org

Our current economic policy is unsustainable, how can we pay back all this debt ? We cant even pay the Intrest anymore!

Lets right off the debt and let the Government make new the money by spending it into the Economy!,

Lets stop the banks from creating money as Debt which joe public needs to pay back the Intrest on!

Robert, How about your views on the late Doctor Edward C Hamlyn`s Policy Reform.

Robert,

You miss another factor that is highly likely to be driving the Treasury to look at the 40% rule. Last budget the government delayed the move towards adopting International Financial Reporting Standards (IFRS) but they are still due to come in for 2009-2010.

The effect of this will most likely bring a very high proportion of off-balance sheet PFI deals onto the public sector balance sheet - this will blow the 40% rule sky high the moment that massive PFI liabilities start to be portrayed fairly.

#1 supercalmdown, I agree, I think the most we can expect from Brown is pregmatism - making the changes as the need for changes arises, without worrying too much about the political fallout.

If this is an example of that, then I congratulate him even if he isn't the first.

As with Tony Blair, I think many of us have made premature predictions on GB's legacy (including Peter on this) and I think they're exactly that.... premature.

I will also be voting LibDem at the next geneal election, but then, how could I not? Vince Cable is my local MP and the only suitable candidate for Chancellor.

What is the point of having any economic rules if, when they get to be inconvenient, they can be changed? This government already changes the dates of the economic cycle (The Golden Rule) to suit themselves. This government is a farce and perhaps public finances should be put into the hands of independent economists who could make more accurate forecasts and force the government to stick to its rules.

Well clearly the reason he has to change the rules is that he hasn't been stickeing to them for the past few years. During the years of strong growth he has not saved enough to pay for the deficit requiredin the coming years. Clearly he has ignored his own rules for years anyway.

I'm surprised that anyone can view this action as pragmatic; virtuous because of the dis-regard for political consequences.

This represents the complete failure, and the ignorance of, this Labour government's ridiculous economic profligacy.

For years there had been calls for the government to slow the rate of growth of public expenditure and keep the borrowing levels sustainable. All of these were out-of-hand rejected because Brown had his head so far in the clouds believing he was some kind of economic messiah.

So we had the situation where at the top of the economic cycle we had the highest tax levels for generations and the highest budget deficit in Europe. And now when the government has to re-write it's own fiscal rules we call this pragmatic?

That's not pragmatism, that's incompetence.

Robert

You know perfectly well that the 40% rule was breached some years ago.

The reason was the PFI deals which were kept out of the figures. If they were included, what would the percentage be now?

And what additional costs are being incurred now and in the future to pay for PFI, ie to sustain a fib that was always going to unravel.

You and your colleagues should not act all innocent about this outrageous moving of the goalposts.

The same applies to the definition of the cycle. Financial journalists have supinely let GB and the Treasury get away with shameless manipulation of the start and end dates, to allow the Government to claim it was balancing the books over the cycle.

Again that was bound to unravel in the end. How do you guys let go unchallenged (or at least barely questioned) the Treasury's latest wriggle in stating that we are now at the start of a new cycle?

Sure, I vote Lib Dem and I also love Gordon Brown! He's brilliant. A genius! A man of principle! He invents a strict rule to hold the government to account in order to convince us all Labour will act in the country's interests rather than Labour's. When things get difficult he re-defines the Golden Rule, moves the dates of peak/trough and generally treats us all like idiots. He sees the RPI is projected to rise so he changes to CPI. He uses Private Finance at huge long term cost to us to keep things off the books. All he seems to be interested in is winning the election. Now the master plan appears to be to bankrupt the country in a slash and burn to leave the Tories with a disasterous mess. Brown's Golden Rule is little more than the pot of gold at the end of a rainbow. How long before he changes the Bank of England's remit in order to forestall a pre-election interst rate rise?

Won't Northern Rock take us over 40% anyway?

I'm sure you mentioned this earlier this year Robert.

Disraeli was right about lies, damned lies and statistics.

As far as Gordon Brown is concered Prudence like Elvis has long left the building.

@1, supercalmdown

How exactly is this unfair? These rules were not arbitrary, but designed to ensure a flexible and reasonable amount of borrowing during a cycle.

They were Brown's clarion call of prudence and responsibility, and now when he's being hoist by own petard, Robert is quite right to point out the potential damage.

This is pragmatism, but its been brought about by Browns short-sightedness, profligate spending and squeezing of the nations taxability thus destroying the existing flexibility his Golden Rules already had.

His opponents are going to seize upon this, and its going to further erode what little trust the electorate still has for him.

It's not often someone kicks down their own pedestal, and the outfall ought to be interesting.

The 40% number is a confidence builder not anything of any economic significance. It is at once a staff to protect oneself and a stick to beat you with. It is a protection against rabid hacks. However its only real value is in the attitude to balancing expenditure it demonstrates.

Most of the statistics about the economy are not certainties - nobody actually believes the rate on inflation, for example.

The other flexibility is the idea of a fixed economic cycle - in hindsight of a decade or so you can fix an economic cycle but not in real time.

A previous contributor also notes the PFI/PPP mortgaging of the future generations problem with the national accounts. As is the problem of the Treasury's continued inability to account for capital and revenue expenditure.

These numbers are an interesting thing but nothing to get too worked up about, except for the opposition!

I've been saying since 1997 that Gordon Brown is economically incompetent. No-one listened, apparently I didn't know what I was talking about. I said there was no way he could keep picking our pockets and waste it without it all ending in tears. When he robbed the pension funds I said he would destory the pensions industry, no-one listened.

I said that within 20 years economists will be writing text books, quoting the early 21st century British economy as a prime example of how NOT to run an economy. As house prices zoomed up and everyone borrowed on the strength of it, people laughed at me. Who's right now?

Flexibility regarding government policies is one thing.
Changing fiscal rules (designed to prevent excesses in difficult times by defining a limit) in difficult times is a sign of failure.

This is simply a national embarrasment.

For those pointing out Northern Rock and PFI already breached the 40% rule, you have to remember that those were not as overt as this.

With PFI, Brown had adopted Enron style accounting methods to keep it off the books, and so out of Joe Publics view.

With Northern Rock, it was 'to help' the bank, and so understandable to much of the public.

This, on the other hand, is an overt admission of failure by Brown to adhere to his own rules, and the fact he, nor Darling, cannot find a way to brush it under the rug really ought to indicate just how desperate things are.

When such an evasive politician as Brown finds his hand forced in this way, its a good indicator of just how much trouble we, as a nation, are in.

Brown's messing the country up so badly, he'll almost want the Tories to win the next election!

It was said on Today this morning that David Cameron was advised not to win the next general election as the public finances would be a mess. But yes, Mr Preston what would happen when the PFIs are taken into account? We're already being ticked off by Europe for having too much debt. In a way the Government mirrors the general debt culture in the UK. This links in with the fuel duty hold as well. Shame you didn't cover Osbournes and Cables comments on the matter. I hate to agree with Osbourne but he was right when he said the rules were there to put money aside and GB didn't. Maybe TB saw what was coming and jumped at the right time. What hasn't been criticised is the fact the GB sold off too much of our gold. Considering the price of gold now, we should have held on to it. But lest we forget, the recession Margaret Thatcher took us into in 81 was by some accounts more severe than it needed to be. Inflation is still reasonably low just higher than we've got used to. Why aren't any of the ´óÏó´«Ã½ commentators pointing out the obvious: don't increase public spending just hold it! And trim some departments down in Whitehall.

"might also not be in the interests of a Labour Party facing a general election in less than two years."

This is the solid Golden Rule, 'Re-election at all costs, that is theirs not ours'.

Perhaps commentators such as Mr Peston might add the Private Sector Debt to the Public Sector and then compare the debt/GDP ratios since 1997 and with other G-7 countries.

Might be a bit unsettling though.

The guy that responsible for the most significant changes in financial governance of the post war era. Do you believe we would have had the economic stability of the last 12 years if the B of E had not been given independence? Record employment, record activity rates, company profits at all time highs. sustained economic growth, and low inflation. I suppose it was all just a coincidence.

From where I sit it just looks like knives sharpening to have a go at a man who was untouchable for too long. The press and polticians really do hate people who keep on being right.

Magically, according to the press the 'economic' miracle has dissolved in front of our eyes, and its all through government mismanagement.

Am I wrong in my assessment that we still have economic growth, record employment, historically low interest rates, and comparatively low inflation (with EU). I wouldn't mind betting Ben Benanke would swop positions with Alistair Darling, and that he'd have to join a queue.

Have I not been reading a number of leading economists who support relaxing govt spending rules? These eminent people have lost the plot?

Come clean. Just say you don't like Brown: he's arrogant, insecure, and out of touch. Then tell us what he should be doing that he isn't.

Here's a few ideas: remove stamp duty on homes under £250,000; raise the top rate of tax for those earning over £150,000 (or 10 times the poverty level); a windfall tax on oil companies; remove child benefit for those earning more than £50,000, install limit of 2 children; cut diesel duty; revise role of watchdogs to make them more effective in protecting consumers; review and revise workings of OFT; block purchase of London flats, at present deeply discounted; furnish under same conditions as in rental market; phase out all payments ofr second homes.

This has always been an old fashion tax and spend labour government.It has taken years for the electorate to wake-up to this. Unfortunately the Tories still havn't realised this.They still want to stick to Labours spending plans if they are elected.How out of touch are they?!!With over £150bn spent on government quangos,most of whom are a complete waste of money it wouldn't be hard to balance the books if we had any real leadership in this country.

Actually I withdraw my statement about inflation. Inflation is really a personal thing depending on what people generally buy, what type of residence they live in, whether they rent, mortgage or own out right etc. Sorry! Just posting this as I know there will be many comments about inflation.

I can see those Tory election posters now !
A picture of Gordon Brown, with huge print..

'Prudence with a Purpose'.

'We will lock in fiscal tightening'

'There will be NO MORE RETURN TO BOOM AND BUST'..

'I will meet the Golden Rule'..

Hysterical, if it wasn't so serious for people on low incomes, struggling to pay astronomical rises in gas and electricity prices on payment meters...

And to be honest, other than those posters, they wouldn't need to even bother with a PR agency for the 'adverts' /ppb slots either - they could just re-play videos of Gordon Brown's budget statements from the past..

The contrast between those good times and what is happening in the economy now would do the damage required to Labour's election prospects..

This is beginning to look more and more like a rerun of 1978-1979.

Remember the election that never was?

Remember the last-ditch attempt to buy votes without any regard for the state of the economy?

Only now there's nobody waiting in the wings . . . . . .

It seems ok to change the rules when it isnt working. Just a shame that us mere mortals cannot do the same.
The only salvation is that no one believes a word this government says about anything after 12 years of lies,lies and more lies so perhaps we should say "who cares" anymore. The country in such a dire mess and still Mr Brown and his puppet cabinet still want to spend spend spend !
Its time to stop the waste and corruption now but I fear even then it is already too late.

The only explanation for the serially disastrous decisions on the running of our economy is that Brown has given up on winning and wants to make things as bad as he possibly can for the incoming Tory government.

the UK is in SO MUCH TROUBLE.

Well it's obvious just how "prudent" our dear leader has now shown himself to be. It's easy to be the golden chancellor when you have easy credit, cheap foreign imports and a housing bubble to rely on for your tax revenue. First sign of trouble and the house of cards seems to be tumbling down. Bailing out banks with taxpayers money, shunting his PFI debts onto another chancellor years into the future and now ripping up his rules. Oh, and no doubt more stealth taxes to come, of course; his name is practically synonymous with them.

His position isn't that much different than anyone elses at the moment as he tries to juggle his finances - it's just on a much larger scale. The average family is seeing their costs rise faster than their income so what are they doing? Putting off buying that new car, shopping at Lidl rather than Waitrose, cancelling their gym memberships, cutting back on holidays, etc. As disposable income diminishes they are reducing their overheads. What they don't do is continue a now unaffordable standard of living by going to loan sharks, which is what Gordon seems to be doing. Shouldn't he be cutting all the non-essential drains on public finances, such as scrapping ID cards, disengaging from overseas military commitments, getting millions of benefit claimants to do the jobs that immigrants find so easy to fill, cutting back on all those quango non-jobs?

I feel sorry for George Osborne in a couple of years time. What a mess he'll have to clear up. Meanwhile, Blair timed his abdication perfectly.

What is worrying is that this 'election at all costs' is happening all over the world.

Note in the states, in order to ensure they have a fighting chance at the next election, the Republicans cut rates at an astonishing speed in order to stave off recession.

Now every 1st year Economic student will tell you that the economy is like a flywheel - it's takes time to get up to speed and time to slow down. Now is anyone surprised that the inflation rate in the states is starting to creep, and soon will take off like a ricket.

We're in danger of making the same mistake here. The 40% rule was a good idea - very much like consumers should be following themselves. I'm not one for quoting Thatcher, but I seem to recall her talking about running the economy like her father ran the greengrocers.

This is a good and simple method of managing the economy, this is probably why smaller econnomies (Luxemburg, Iceland, Monaco etc.) have a lot less boom and bust despite having huge disadvantages by having to import most resources.

The danger here is that the rule is being broken for the wrong reasons, for election purposes and not what is best for the country. It's also a lazy approach, because a business in this situation would look at cutting costs to see them through the bad periods. This doesn't have to mean cutting public spending on schools and hospitals, but making internal processes more efficient.

A clever government would have been thinking about this 2 years ago. There was a period when all parties were promising to 'cut red tape and innefficiency' - but I haven't seen any sign of it.

I can help here, I have recently discovered the Government Department of Transport have spent over £6 Million (so far) on the implementaiton of new motorway signs - which duplicate existing signs and will cost more to maintain.

So Robert, when you next see Alistair Darling, can you let him know that I can save this country 6 million quid which might help him. It's better we do that than what is likely to happen with the course we are taking.

The Government is supposed to lead by example, not follow the mistakes of it's citizens!

....and at what rate will this government have to borrow this cash? With the LIBOR high and the cost of credit still on the up, the Gilts issued might have to be at a fair old rate.
Luckily all the crooks who made money from the sub-prime crisis will have their readies to buy up "UK Govt PLC" - which GB and AD have just put up for sale.

The main problem with these "Rules" was that they encouraged dishonest accounting with liabilities like PFI and un-funded pensions kept "off balance sheet" to make it seem like the rules were being kept. As a result the public finances are in a far worse state than Brown has ever admitted.

So New Labour has become St Augustine in reverse: lets be less virtuous but make it quicker!

As well as being disappointing this is quite frankly terrifying. We are already in serious economic trouble and the government is thinking it should chuck away the rule-book. How is that going to play in the international markets?

The ship is heading for the rocks so throw the charts overboard and give the drunken captain another bottle!

Talk about the Amy Winehouse school of economics!

#10

Completely agree.

#20

I agree with all of your ideas, but completely disagree with your appreciation of how much GB has contributed to impending pain that the UK economy and public are facing and will face in coming months and years.

Over-valued housing market and an economic upturn built entirely on a platform of recycled debt, which is rapidly unwinding before everybody's eyes. That is what GB and Nw Labour have contributed to the UK, and he still persists in shifting the goal posts to try and hang on to power for as long as possible.

He wants to changes the rules to buy himself out of the mess that he has steered the UK into.

WIN THE ELECTION AT ALL COSTS!!! SPEND! SPEND! SPEND!

That is all he knows, tax heavily, spend heavier. Where is our contingency? What happened to the 'fat on the bone' during the good times? HE SPENT IT!!!!

Now he needs to change his own rules to SPEND MORE!

Restricted and one dimensional leadership with his own interests at the forefront of his decision-making, not what we need in the current climate...

I wouldn't want to win the election if I were Cameron, talk about wiping someone else's backside...

"To put it starkly, they buried Labour's past as the tax-and-spend, boom-and-bust party and allowed it to claim that it was the new natural party of government."

I dont see this at all. They've done exactly the same only used stealth tactics.

The Boom: Stocks and shares and when they bust, houses.

The bust: A depression starting now. Not a recession but the full blown, nightmare version.

The taxes: Inflation is a tax and an insidious one. It allows governments to monetise their debts which is why all governments go out of their way to create it. Labour has lost control and real inflation is at 10% while they underreport it at 3.8

Oh dear !. This is real desperation. The fiscal rules have already been stretched to the point of breaking.

By 2010 we will probably know the real mess the economy is in and the true extent of consumer debt. When the PFI deals are revealed and put on the balance sheet any fiscal rules that remain will be blown out of the water. When the housing collapse has bottomed out in 2010 with 30 – 40% wiped off the value of the housing stock the the consumer debt of £1.3 trillion balanced against assets will reveal how serious the problems are for GB Plc.

Gordon Brown and New Labour invoke memories of the 1970's asset strippers who destroyed so many companies. It will take 7 to 10 years to recover from the economic legacy of New Labour and all the time they are in control of the economy the longer it will take

When the going gets tough, the tough get going.

The not-so-tough change their own rules to make life easier for themselves.

Disappointing.

What are the odds on the Lib Dems getting more seats than Labour in 2010...?

I suggest that
the focus of the comment on the
chancellor's review of the rules is misplaced.

Rather, it would be better directed to evaluating the consequences of an increased ratio of borrowing to GNP.

My requests are as follows:
1. Would an economist please do this.
2. Would news editors please reduce the criticism of the government for its past failures and attend to present and future concerns.

What a pessimistic bunch you all are. The first sign of difficult times and the whole world is falling apart. I get the impression you are a bunch of Tory supporters who have been hiding in the shadows for the last 11 years too ashamed to show your faces but happy for your houses to have tripled in value, chuffed that your salaries have increased well above the rate of inflation and ecstatic that you have actually not been made redundant in that time. What makes any of you think Cameron and Osborne will make things better. Cameron was in Lamonts failed and humiliated treasury team in 1992, and if someone could tell me why Osborne should be our chancellor I would be very grateful.

This truly is Orwellian stuff.. The War on Inflation is over.. The War to try and balance the budget has begun..

I don't Robert Peston should be beating himself up for having 'missed' the past announcements, anymore than a small village should be blaming themselves for having had a large bomb exploding them out of existence, when it was dropped out of a clear blue sky by a 'stealth bomber' which was designed with the clear intention of evading radar, making it well nigh impossible to foresee the damage that would be caused..

This was a 'stealth' announcement so it is no surprise that the enemy, sorry, the Treasury, can find 'no evidence' of it - clearly they did not want their fingerprints on the 'MOAB' once it has wiped out the lives of many innocent civilians' budgets...

This is disingenuous nonsense from Darling and he deserves a good tongue-lashing from Paxo, Peston and Humphrys.

robertdmarshall wrote:
"Rather than leave the productive part of the economy to do its natural thing i.e the private sector be allowed to grow. "

Quite: we don't want our taxes spent on non-productive things like the armed forces, NHS doctors, and the police, do we?

The reality is it's kind of like you or I looking like we are about to go over our agreed overdraft, and contacting the bank manager beforehand to increase the limit.

The worrying thing for me is that, the supposed boom over the last 10 years or relative economic prosperity should have resulted in Tony/Gordon to have put a bit away for a rainy day or credit crunch or "fix the roof".

Instead, just like all those people that have £000's on credit and are still continuing to spend in the face of a recession, Gordon's told Darling that all the cards are maxed, so he needs to get another card to spank. Just like a good boy, he's done what he's told. The problem, like all those people who are in debt have found, is that you can't go on borrowing forever - it catches up with you in the end.

Face up to it Brown and Darling - you've not put any money away and now the UK Taxpayer is going to end up paying even more in all kinds of inventive stealth taxes that are passed off as environment saving taxes.

My memory is probably not as good as yours, but I seem to recall the Chancellor standing up at the last Budget to tell us all how wonderful the Economy was doing and that the Public Finances were in better shape than they had ever been and made all other World Economies look terrible by comparison. Lying again was he??
I do not rate Brown as a good Chancellor; I believe he blew a good financial position, and would like someone to tell me this; did Brown go to the Enron School of Economics or did Enron go to Brown school?? It would help explain why so much debt is not even on the balance sheet.

I guess the government has 2 choices - move the goalposts to allow them to borrow more to cover the shortfall on tax revenue or keep the rules the same and increase taxes, the latter would spell the end of Gordon B even sooner than predicted!

As has been mentioned above and in the news, they didn't put anything away to support a dowturn so now they are between a rock and a hard place as to where to turn next, all they can do is borrow more and hope the dowturn doesn't last too long.

The governments next issues are pay rise demands to match inflation in parallel with increasing redundancies. The former are a foregone conclusion, the latter will ramp up fast as businesses try to stem profit falls. Alastair D cannot admit to a forecast growth below 2% - if he does this means lots of folk will be comming out of work with the subsequent loss in income tax revenue and more spending on benefits. Logic here if I understand correctly is we need at least 2% growth to maintain current employment levels since business efficiency increases by this each year.

Finally - the economic cycle and it begins and ends when the government says it does, that I have to say is a classic. sort of like a parent to a small child 'because I say so'... I think David Cameron needs to think carefully about inheriting what Gordon Brown has created - does he really want to inherit a country in recession?

Changing the rules to allow public spending to carry on regardless while the real economy nosedives doesn't seem very sensible to me.

We are in a big hole with public finances so the last thing we want to do is to keep digging.

Better that we take the full pain of the downturn now, If that means Labour get chucked out then Bring It on!

I am getting the definite impression that all financiers and economists are just plain incompetent, and that politicians are dishonest and corrupt. In many ways they remind me of those old eminent physicians who believed that our health was determined by the four humours.

This Government reminds me of The Mad Hatter's Tea Party.

#39 , EricJT wrote:Quite: we don't want our taxes spent on non-productive things like the armed forces, NHS doctors, and the police, do we?

Actually these are quite productive elements of our society.

What is non-productive are the politically-correct chair-warmers who shovel millions of public funds to their cronies and *NOT* expect them to deliver the goods !! From the massive failures in govt. IT projects and the Big Brother-ish ID project to the latest sleaze discoveries in the London Mayoral Office.

Add to that the statistics and tests-obsessed management of the education system that failed to deliver even the simple SATS results and we have a clearer picture where the money is being wasted !!

Re-writing of the fiscal rules will be the official confirmation of what most people have FINALLY come round to realising: that Gordon Brown was the most disastrous Chancellor this country has seen for decades, and that really is saying something. He may indeed have a strong moral compass - it's just a shame he completely ignored it in the single-minded pursuit of his ultimate ambition: to become leader of this once great country. Whereas Tony Blair should arguably be put on trial as a war criminal, I'm not sure there's anything we could pin on Mr "no more boom and bust" - perhaps treason for totally destroying the country's economy?



Re: #2 robertdmarshall

The abuse which Labour has levied on the British economy will go down in history as the biggest deliberate and unnecessary economic disaster ever.

Here, here.



Re: #8 Ed2003

This represents the complete failure, and the ignorance of, this Labour government's ridiculous economic profligacy.

Here, here.



Re: #20 baggiespjpc

The guy that responsible for the most significant changes in financial governance of the post war era. Do you believe we would have had the economic stability of the last 12 years if the B of E had not been given independence? Record employment, record activity rates, company profits at all time highs. sustained economic growth, and low inflation. I suppose it was all just a coincidence.

From where I sit it just looks like knives sharpening to have a go at a man who was untouchable for too long. The press and polticians really do hate people who keep on being right.

Magically, according to the press the 'economic' miracle has dissolved in front of our eyes, and its all through government mismanagement.

You are, indeed, it would seem the very proof that you can fool some of the people all of the time. Anyone can appear to be rich, wealthy and successful by spending way beyond their means (this will become especially more evident on an individual basis in the near future). There was no "economic miracle": it was all a mirage. And the proof has been staring everybody in the face for years: "historically low interest rates" are a sign of economic weakness not economic strength, regardless of what Gordon Brown or anybody else might tell you.



Re: #31 stanilic

The ship is heading for the rocks so throw the charts overboard and give the drunken captain another bottle!

Talk about the Amy Winehouse school of economics!

That' a fantastic soundbite! I hope you won't mind if I steal if for use elsewhere 8-)



Re: #33 starquin10

The bust: A depression starting now. Not a recession but the full blown, nightmare version.

Possibly, but with some not incosiderable amount of skill and courage (on a Thatcher scale), I think a depression could be avoided. And while - grudgingly - I have become increasingly impressed by David Cameron as leader of the Conservatives (it really should have been Ken Clark despite his european leanings), I'm really not sure he and Osborne have quite what it takes. Cometh the hour, cometh the man? Here's very much hoping...

Surely the real problem is that the increase in oil prices and utility costs is deflationary by reducing disrectionary spending and leading to a slump?.

We are on the start of a serious downward spiral and action must be taken now.

If the Bank of England were to reduce interest rates significantly this would stimulate the economy,leading to better tax revenues and reducing the need for government borrowing.

We need to recognise that it is not possible to control oil price inflation by UK interest rates.