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IMO the crisis is too deep for any party or political ideology to be able to provide a solution. We've overspent, massively and changes in our demography and our relative position in the global economy mean we have a much lower capability to pay off that kind of debt than we used to... it's a bit like borrowing twice your salary when you're earning 50k on the basis you'll be getting a payrise next year so you can pay off the debt, and then being given a massive pay cut instead... you've made a wrong calculation and now you're screwed.
We've come to the end of the post-war boom, which was as much as anything a matter of demography... it was always going to come to an end at some point...
I don't think any political party or central bank in UK, Europe or the States has any idea how to fix this - otherwise they'd have done it by now.
We've an ageing population in poor health - we've got used to living beyond our means and have largely not set aside enough for our pensions... and the old ways of making ourselves wealthy aren't going to work in this new world...
As one of my mates who recently moved to Abu Dhabi said - "Interesting times we live in. Come and join the action… It is not in the UK…"
I'm 42 and I don't expect the 'recession' to be over in my lifetime tbh - slow, if any growth, static living standards most likely.
It might chill us all out a little. Maybe we'll get a bit less materialistic and go back to thinking about our communities again? personally I think people are craving a little simplicity and getting off the mad treadmill we've been on for the last 20 years..
well technically we have been out of a recession for while
LT v low growth (and sub trend) is probably a more apt description
Beware the dreaded headline or at least read the text that accompanies it as they rarely match!!
I don't know why the obsession with the headlines as I posted a direct link to the whole article/text.
I don't know anyone who is only interested in headlines but not the accompanying articles ........ do you?
I also posted a direct link to the Centre For Macroeconomics report, the one which says that two thirds of the UK's leading economists who responded to their survey disagreed with claim that "the austerity policies of the coalition government have had a positive effect on aggregate economic activity (employment and GDP) in the UK".
I thought some people might find it interesting because it's not what Tory politicians are claiming. In fact it's the complete opposite, ie, Tory politicians are claiming that their economic policies have had a positive effect.
Who to believe, the politicians facing reelection or a bunch of academics?
It's a tricky one.
Then again what does she know?
Well it is surprising to see a right-wing politician supporting a right-wing government, who'd have thought it eh?
Then again what does she know?
Well if Christine Lagarde, or the French bird at the IMF as you like to call her, keeps changing her mind, as you claim, why should anyone listen to what she has to say?
Although I'm not sure she has changed her mind that much. Two years ago she said that the poor performance of the British economy had left her with no alternative but to call on George Osborne to rethink his austerity strategy.
[url= http://www.theguardian.com/politics/2013/apr/18/george-osborne-imf-austerity ]George Osborne told by IMF chief: rethink your austerity plan [/url]
Isn't that exactly what George Osborne did - rethink his austerity plan, as you keep reminding us THM, and indeed do the economists in the Centre For Macroeconomics report?
Perhaps it's more of a case that George Osborne changed his mind rather than Christine Lagarde ?
I also posted a direct link to the Centre For Macroeconomics report, the one which says that two thirds of the UK's leading economists who responded to their survey disagreed with claim that "the austerity policies of the coalition government have had a positive effect on aggregate economic activity (employment and GDP) in the UK".I thought some people might find it interesting because it's not what Tory politicians are claiming. In fact it's the complete opposite, ie, Tory politicians are claiming that their economic policies have had a positive effect.
I may be missing your point here, but what other answer could possibly be given to that question? In other words, how could 'austerity' or reduction in government spending have any other effect that to reduce aggregate economic activity (ceteris paribus)? That statement tells me nothing, because the key question is whether the alternatives were any better.
Clearly if the taps had been opened on government spending instead of (slightly) restricted for optical reasons, then we may have been better off - unlikely though given potential debt crisis.
Its about making silly points, but as Ernie says, and I agree, the text is the interesting bit. Makes the headline look silly. Imagine:
"2/3 of economists believe that cutting spending and raising taxes is good for the economic growth"
The IMF did multiple flip flops here which was quite amusing!!! Not forgetting that there error in calculating the fiscal multiplier was one reason why people made policy errors
I may be missing your point here, but what other answer could possibly be given to that question?
My point? MY point??? 😯
I didn't ask the question! It was the Centre For Macroeconomics who asked the question 🙂
And they put that "one answer" question to 50 leading economists, 33 of which responded.
The result was two thirds disagreed that "the austerity policies of the coalition government have had a positive effect on aggregate economic activity (employment and GDP) in the UK".
While 15% of the leading economists surveyed AGREED that "the austerity policies of the coalition government have had a positive effect on aggregate economic activity (employment and GDP) in the UK".
Perhaps you need to point to [i]them[/i] the impossibility of such a feat?
A sure fire way of getting UK plc back to growth is to ratchet up manufacture of handbags, set up an online store and put a few ads on STW. There's definitely a market for them 🙂
Handbags, how disappointing.
Its Maserati's, luxury watches and private banking don't you know!
After calling Carney, have a word with the French bird at the IMF who keeps changing her mind on the UK. Last version was:
You mean the genius who masterminded Greece's escape from economic collapse?
Indeed doc
Not forgetting that there error in calculating the fiscal multiplier was one reason why people made policy errors
There estimation of the impact of tighter fiscal policy proved to be an incy-wincy bit out!!!
Still nothing compared to locking Greece into a fixed exchange rate combined with artificially low interest rates.....BOOM!