Monday 18 January 2010

To double-dip or not?

As we all know, double dipping is a horrible social faux pas to make, one of which can really see oneself drop in the esteem of your social group.

Yet the IMF is warning today that the advanced countries of the world are facing just this prospect - a double-dip recession. He forsees a drop in Government support for the economies and this to cause a double-dip recession; oh how his words will please Gordon Brown and Ed Balls.

On the other hand, Gordon Brown and Ed Balls spent years ignoring the wise warnings of the IMF, so just be aware when you listen to the newsbites that labour will create what a total sham it is now that Labour agree with the IMF.

As it happens, there is not a very big chance of a doubel dip recession this year in the UK. the reason for this is for a dip you need to have an up, or even a flat-line. The truth is the UK economy is sclerotic and bouncing along a very low bottom. There ain't much lower it can go. Even recent good Xmas numbers from the retailers (a prediction of 6% average rise my co-writer Bill Quango nailed) are a bounce from last years epic low.

Just to prove the point, the E&Y Item club has published today a grim outlook for the UK economy. needing exports and less consumer demand, but unable to generate either. Seemingly the economy is set to bounce along the bottom.

On the plus side, with unfeasibly low interest rates and printing money, there will be a continued boost to the monetary economy that will see us avoid a double-dip. To get growth though, we are going to need to cut excess budgets and lower taxes and regulation. More enthusiasm from our Political Leaders is needed for this.


Demetrius said...

You think the UK economy is at bottom and unlikely to go lower? Well, I hope you are right but fear you are not.

James said...

You're right of course no chance of a 'Double Dip'. Possible prospect of a 'Double Drop' though, makes for less good puerile headlines though so of course the media twist the debate.

CityUnslicker said...

Guys your are perhaps right - a double drop would look something like a lightning bolt?

Budgie said...

What does the UK economy do? This is sarcasm btw.

We could, of course, shuffle the paper around a bit faster and see if that increases our GDP.

We do need bankers, estate agents, even politicians because they act (hopefully) like a lubricant in an engine. But we have almost no engine left.