Pistolpete2

Here's an article in the Guardian which on the face of it is good news but when you actually read the article there is precious little in it to support the positive message put forward by the headline.

http://www.guardian.co.uk/business/2...ecession-niesr

July may have been good but August was terrible for output.

"The strength of the figure for the three months to September is largely an artefact of special events. Economic growth is expected to be at a significantly slower pace in the coming quarters,"...........

"A weak set of trade figures for the UK, also published on Tuesday, threw further doubt on the prospects for recovery. The trade deficit on goods widened to £9.8bn in August, from £7.3bn in July, with exports declining by 4% on the month. Analysts said this reflected the impact of slowing growth in the eurozone and other major economies."

Oh well!

I see the Pound has come off the boil against the USD a fair bit in the last few days since Sept 19th, as had the Euro until this last weekend - Angela Merkel kicking butt now in Athens? Spanish bailout?

Pit Bull.

Bad news announced today I'm afraid, the UK economy growth figures have been downgraded again, they say we are staying in recession with a -0.4% retraction, which is bad news, I had heard murmurings that things were starting to improve.

Pistolpete2

I guess that this is your source, from the BBC:

http://www.bbc.com/news/business-19882671

Both (Guardian and BBC) from: a respected think tank - The National Institute for Economic and Social Research (NIESR)

-.4% contraction is for 2012 overall, from the IMF. If you contract somewhat in the first half of the year but grow slightly in the second half I guess that is still contraction.

Pit Bull.

That's not as bad as I thought, we are in recession already, which means we ave had two continuous quarters of minus growth, so it looks like they are partly talking about this and not future predictions, which is slightly better ..... I hope.

Pistolpete2

I hate to be a kill-joy but in spite of my best wishes that things were to the contrary, there is so much baggage in this (UK) economy, let alone Europe or the US or the rest of the world, that even if there was some tiny speck of growth out there it is not going to make any appreciable difference to the overall state such that a rising tide will lift all boats.

Everyone had been expecting the growth economies of India and China to take over where everyone else left off but they are either languishing themselves or struggling to keep growth going without inflation.

This is not something to sit on the edge of your seat about waiting for the sudden appearance over the horizon of a huge patch of blue sky. The sensible articles on the subject and even sensible Government officials (other than Vince Cable) have said as much - this could take quite a few years, at best.

chris955

It is a fantastic thing for the London area and the whole country. London attracts millions of tourists so it will be literally right in the thick of it. Of course the huge bonus will be the thousands of jobs not just the building but once it is up and running.

Pit Bull.

It does look like the UKs economic recovery is going be very long and very painful for a lot of people.

Pistolpete2

Yes indeed, they (construction and theme park employees) also will be able to come into the area on the fast trains from the Continent, unless the vote David Cameron seems to be promising goes the other way.

Can you guess, I don't like all of those minimum wage jobs and the emphasis seems to be on creating more of them. HOWEVER, if minimum wage it is then so be it.

Anyway, agreed VERY good news if it goes ahead as it looks as though it will.

chris955

Dont get me wrong I dont pretend this isnt happening but equally I dont obsess about it and worry about it. I wouldnt actually know if the last three months were positive or negative, it doesnt actually affect our lives one way or another. All this hasnt affected any of our friends, they all work, own their own homes, go on holiday blah, blah, blah. It doesnt mean that times wont be tough for others. I left a country being hit by massive budget cuts and have come to another. What a world we live in

chris955

I cant comment on how much employees will be paid to be fair, it is no different in any western nation to be honest and does seem to be the way 'forward'.

Pistolpete2

I agree with you ref obsessing. If knowing or believing that one knows which way we are going doesn't make a blind bit of difference to what one can actually do to take evasive action, if that is indeed even necessary on a personal basis, there is little purpose in the knowing or believing.

I went very close to the cleaners in 2008 and early 2009 and would want to avoid that as much as is possible but that only nearly happened because of the way I am personally positioned, in particular that I will NOT now be able to find any future meaningful employment and have to live off savings. I can't live if my deposits only pay me 2.0% - 2.5% before tax.

The average person might want to from time to time consider their credit card and personal debt position and the level to which they are spending their income and saving for the long haul but beyond that......?

As has been said, the irony in all this is that the UK is a consumer economy and relies on folks being gung-ho and going out there and spending, often with debt. If we were all to take the Chicken Licken approach then we are guaranteed to make the economy nose-dive.

So I should say that the economic spiel such as that I dish out from time to time should be used only if the cap fits but it will hopefully temper false expectations which lead to wrong major decision-making.

chris955

Pistolpete2

Surprised, but pleasantly surprised by this:

http://www.telegraph.co.uk/finance/e...s-to-grow.html

Not sure what it does to expected future exchange rates between the USD etc. and GBP in light of positive news ref the US economy.

dunroving

Every "expert forecast" I've been reading for the past 3 months or more has pointed to the $/£ moving towards $1.40=£1 by next spring. Since then, it has moved inexorably in the opposite direction (from the mid $1.50s to low $1.60s).

I think all of the bad news in Europe should be hurting both the Euro and GBP (because we are so reliant on exports to the EU), and making the $ a more attractive haven. But the actual exchange rate seems to defy logic and be going in the opposite direction.

Pistolpete2

From Scotiabank October currency review:

For the US:

"The lack of a credible fiscal plan and the expansion of already loose monetary policy are not conducive to a sustainably strong USD, outside of
temporary spikes in risk aversion. However in currency markets, it is the relative story that matters. In this context, the USD is likely to strengthen against the euro (EUR) and Japanese yen (JPY), but weaken against the
Canadian dollar (CAD), the Mexican peso (MXN), the Australian dollar (AUD) as well as a host of others"

For the Pound:

As you say,

"Fundamentally weak, the British pound (GBP) benefits from its triple-A status and positive sentiment; nonetheless, we do not expect material gains from levels achieved in late September. The UK’s ties to Europe are a notable risk for GBP."

Consensus is for the Euro and GBP to decline against USD from today's levels between now and 3rd Qtr 2013.