[Closed] More bad news on the economy...

THE UK economy may be on its way back to full health

Can you see which word is the important one in that sentence there Wopster?

I [i]may[/i] be about to evolve wings in an amazingly compressed, Darwen-defying timescale, start flapping them, achieve human winged flight for the first time, then migrate south to somewhere warm where I will sit sipping cocktails, while preening my feathers

And I do love your well-known, respected, impartial and balanced 'news' sources 😆

Is this any better a headline, binners? Do surveys suggest you're going to evolve wings?

UK economy picking up, surveys suggest

My apologies for selecting another biased news source - though I presume the OP used that one as he knew how much you'd all appreciate Gideon's smiling face on a Monday morning.

http://www.guardian.co.uk/business/2013/may/13/uk-economy-green-shoots-recovery

knew how much you'd all appreciate Gideon's smiling face on a Monday morning

😀

Ahh, some people are only happy in their misery and would rather foretell doom an gloom........

Woppit - Lehman Brothers has gone bankrupt!

The stock markets are soaring on the back of currency devaluations and endless QE. One day, soon, it will all end in tears...

http://www.ft.com/cms/s/0/d7578e0a-baee-11e2-90b4-00144feab7de.html#axzz2TAGcXwY2

A slightly more measured tone than that rabidly positive tosh.

To paraphrase; its still going to be shit for a fair bit but it might be a bit less shit than recently. Lets not get too excited just yet.

Or... We're bouncing along the bottom held up by QE, but it can't last... you ain't seen nothing yet...

I think woppits link is best:
Barclaycard say more people are spending money, yippee!! another debt led boom! osborne is da schnizzle

Not just a credit boom though. Don't forget Gideon is also planning to plough billions of taxpayer funded guarentees to artificially maintain house prices, by providing deposits for people who can't presently afford the already over-priced housing.

What could possibly go wrong?!

Ah, but don't forget the deposit guarantee is a junk loan from the government by another name.

It will artificially inflate and maintain a house price bubble. Maybe with house prices going up, people could then borrow against their equity to buy stuff they don't need, on credit. You could even make that look like economic growth, in the total absence of the real thing

Hmmmmm.... actually....that's sort of got a familiar ring to it? Has anyone tried that before?

binners - the Treasury are sending a car for you now. You've just the kind of great ideas and can do attitude that will make this country great again, well up until the next election at least and then who cares?

The question is, binners, are you confident enough in your idea to suggest it will put an end to boom and bust? I suppose if you wanted to hedge your bets you could always just suggest it would put an end to Labour boom and bust.

Is there any reason why that guardian article has a picture of the premier of Star Trek into darkness on its report?

They were probably going to put a picture of Gideon smiling in, but somebody on the editorial team was sick all over it.

It's sad that some people want the economy to fail just because they don't like the political party in power. I'd rather see less unemployed than gloat over how shit the govt are.

TBH, there's a striking similarity....

[img] http://www.politicshome.com/images/1.1.MPs/George_Osborne_250213.JP G" target="_blank">http://www.politicshome.com/images/1.1.MPs/George_Osborne_250213.JP G"/> [/img]

Wrecker - I can't see anyone taking any great pleasure in it at all. Certainly not gloating. Its an absolute disaster.

The options appear to be:

This lot. Policy: No plan for [i]actual[/i] economic growth whatsoever. So... more of what went really, really well before. Credit fueled house-price rises. And more austerity while we privatise everything

The other lot. Policy: Erm.... who knows? But Ed Balls would be in charge. And he has an impeccable record on economics. What could possibly go wrong?

We really are ****ed!!!

I like that sort of even handed analysis.

What as absolute load of crap that survey means and is, all around me people and customers are loosing their jobs, along with the ability to pay for my services, every few hours i get more texts and emails ofering more and more discounts on kitchens, bathrooms and bike stuff, offers of intrest free credit and free gifts if i take up some such offer, problem is for me and lots like me, we have no spare cash, we dont want to be tied into a finance company.
Walk down any high street or retail park and see all the empty shops, go in the ones that are open and see all the bored sales staff, the ones who jump on you and try and sell you stuff you dont want/cant afford.

Yes DC were all in this together, but you get a free house ,fre transport, and free meals, something youre taking off the unemployed and ill.

I'd rather see less unemployed than gloat over how shit the govt are.

Trouble is; Osborne's policies are the reason that there is so many unemployed and that GDP growth is so comatose. No one is gloating about the fact the economy is so shit, just pissed that the current shower are doing such a bad job of improving things for the majority of the population.

I'd rather see less unemployed than gloat over how shit the govt are.

Id rather be employed than sit around constantly sending out applications for fewer and fewer jobs as my industry (cancer research) is continually contracting and the public sector cuts have not been offset by a goldrush of private sector jobs- infact quite the reverse

Sorry to hear that kimbers. Good luck. If things are improving (and I'm in no position to say they are or aren't) then that's got to be a good thing?

I really hope they are improving,
I keep a spreadsheet of all my applications and looking back to 6mths ago (when I first got redundancy warning) its gradually getting worse- I applied for less than half the number of jobs in April than I did in November and thats despite me lowering my salary expectations and looking further outside my field

Is there is a recovery on the way? Im sceptical

I live in hope (the state of mind not the place)........

rather than expectation.

Frankly, I find it difficult to credit Osbourne with much blame or praise. We have a crisis that is fundamentally one of too much debt. This is the root cause of both unemployment and flat growth. This is a legacy issue not really something that can be pinned in Osbourne.

But what has changed in the last few days? Nothing. The only thing that has happened has estimates of economic activity have been revised slightly upwards (as most observers were expecting) but to a slightly larger degree. Thats it? It's simply a statistical change nothing has happened beyond that in the "real world." I said the same thing when the original double dip was announced - mere statistical noise. Not that it stopped the rabid anti-Osbourne brigade at the time.

But as silly as it is to blame Osbourne for the mess, it is equally silly to credit him for the tepid/marginal improvement. He is mainly a bystander in all this. QE has worked in terms of (falsely) holding interest rates low (a good and a bad thing) and the hidden policy of depreciating sterling has worked in the sense that exports to the US and RoW ex-Europe have been better than expected. Unsurprisingly exports to our largest markets - EU - are flat and again we are merely observers to the stagnation across the Euro zone. The weakness in sterling hasn't helped here as much as would be hoped. Loose monetary policy has completely failed in terms of stimulating bank financing in the economy but given that the bank system is still in bad shape that is as predictable as much as it is a genuine failure by Osbourne.

Employment has also been better than expected (hence the questions about productivity are now partially answered) but again hard to see quite what that has to do wih the government. At least we are starting to get some better answers to the how can employment be better but growth be worse? Are we just becoming less productive? Well the answer is closer to the fact that the denominator in the equation (GDP) was doing better than estimates were indicating.

But still the cause hasn't really been addressed. Debt levels remain too high and the euro zone remains in crisis. Hence the bright lights are in fact really only very dim. It's just that the contrast to the gloom behind and around us, make them brighter than they really are.

thm.... As informative as ever. Given your last statement, doesn't Osbournes idea of providing government guarantees of deposits seem absolutely ridiculous to you? Surely just re-creating a sub-prime situation only using public money? A potential disaster?

And do you see any possibility of an end to the paralysis in the Euro-zone? Somebody actually acknowledging the problem, so they might actually do something about it?

Binners, the Eurozone know what the problem is but Germany will not pay for it all. You and your UKIP friends have it right but it should be Germany that leaves the Eurozone.

Gov guarantees on deposits - are you referring to the proposals to help with mortgages, Binners?

that's the one, yes. Seems like absolute insanity to me

Tricky one Binners IMO. Generally speaking, I would prefer to see the housing market "clear" properly but we are a mile away from a free market in UK housing with proper price discovery etc for many, many reasons. That is not a good thing IMO. House prices remain inflated which is bad for some but also good for those that face the horrors of negative equity. So as always swings and roundabouts.

However, the state of the construction industry is dire and is such an obvious black spot in the GDP data that I can see why the government has reacted. And for once, the medicine does seem to be working. The FT recently quoted Barratts as saying that this latest scheme had resulted in a much bigger reaction in activity.

So ST benefits - yes. But LT? Far more questionable IMO and on balance a marginal "NO". Both financial (interest rates) and asset markets (housing, equities etc) are significantly distorted at the moment. And that is not a positive development. My favourite quote of the last week - the "risk-free return" has been replaced by the "return-free risk"!!!

At least all the misleading headlines about double/triple dips can be put to bed. And that has to be a good thing!

Keep plugging away kimbers. I know it's difficult trying to stay positive but it will happen.

I live in hope (the state of mind not the place)....

But what has changed in the last few days?

Could a few positive news stories actually get people spending and therefore help significantly?

Could a few positive news stories actually get people spending and therefore help significantly?

I was thinking much the same, but didn't want to mention it for fear of jinxing things - an awful lot of the state of the economy being all about confidence after all.

I suspect molgrips and aracer are correct, but it does rather suggest that a few bad stories could be equally as bad for the economy...

...which is all a bit scary, and in turn points up how fragile our economy actually is.

Street party anyone?

Yes molgrips, and that could be a good thing. Corporate UK is sitting on quite a lot of cash right now, but lacks the confidence to invest it. The end of double/triple dip BS may be a start as they are misleading titles that hardly help confidence!

As I have said before, Cameron and Milliband both face two potential "jokers" in the run up to the next election. The UK economy may well continue to surprise on the upside (albeit still slowly) but with positive news for jobs, and the euro-zone crisis will essentially take care of itself (in a negative way). The test of their leadership will be in how they chose to react to both IMO.

teamhurtmore - Member

Employment has also been better than expected

Is that really true though? Unemployment may have been better than expected but that's offset with the less reported rise in underemployment- lots of reduced working weeks, part time and nonpermanent work, self-employed people who don't qualify as unemployed even though they have no work, etc.

I work in Hope (the place not the state of mind)........

rather than London. 😀

IMO, yes is true but to a lesser-extent than headlines may suggest! But that is versus expectations. The actual level remains weak/poor overall albeit less severe than elsewhere in Europe. IMO again, it is the dreadful labour market and the social unrest that goes with it that is the critical issue within Europe. Politicians underestimate this at their peril.

I can confirm that the jobcentre people seem determined to get you off their books as opposed to into a job, I imagine that the underemployed and those dropping out of the job market numbers are much higher than the official unemployment figures

while im on jobcentre stories- last week overheard this gem

JC+ staff-sir youve been unemployed since 2009
20 something lad-well yeah kind of
JC-so youve had work?
lad-erm no i mean ive just not claimed all that time
JC-ok well im going to put you forward for some voluntary work
lad-well im not sure, ive got a painful eye
JC- and you are telling me this because?
lad- its been really bad earlier this week
JC- and has the doctor signed you off
lad-no but im just telling you like
JC-ok, how would you feel about kitchen work
lad- errm no, no way, basically ive got this thyroid problem and basically if I work in a kitchen , basically Ill overheat and Ill die!

and so it went on.....

to be fair most of the jobseekers there do seem quite desperate to get work and quite frustrated and embittered by it all

http://www.bbc.co.uk/news/business-22536437

yeah its all rosy

the fall in jobseekers claims doesnt surprse me either the staff seem determined to cut the massive 70quid a week, one wonders wtf that leaves a lot of unemployed people- destitute, turning to crime, cash in hand work?

Kimbers - what you are seeing reflects what the Bank of England said this morning. Any recovery is "weak and [u]uneven[/u]." That's the bad news. The good news, is that today's Inflation Report is the first time since 2007 that the BoE is painting a more optimistic outlook.

I have been criticised in the past for being too negative about our Governor and his/the BoE's forecasting record. So let's just hope that their guarded optimism today is warranted this time.

The rest of the news from Europe today hardly calls for much celebration though. 🙁

Its not the headline unemployment figures themselves that are the issue here. Its the nature of the 'jobs' that are being created.

There has been a huge rise in the use of zero hours contracts, which mean you're not officially 'employed' (so off the all-important figures), yet you're not sure you'll actually get any work, or income, as the responsibilities of an employer now no longer need to extend to this

Most of the actual contracted jobs created are only part time. I think the last estimates of people 'underemployed' (part time but wanting, no needing, full-time work) are at least another 1.5 million

Bearing in mind that on these new 'jobs' there is zero security, and you can't get credit, or qualify for mortgages or personal loans or overdrafts, as you've no guaranteed income. So how on earth are these new 'employees' going to contribute to any kind of economic growth? Its utterly ridiculous to imagine they will.

Mind you, rising unemployment can be a good thing. An opportunity even

[url= http://www.guardian.co.uk/business/2013/may/11/young-recession-cheap-labour ] Recession is a good time to boost profits, says Cameron aide[/url]

Every cloud, eh?