Bank warns of 'deep recession'

Cannon_Fodder

http://news.bbc.co.uk/1/hi/business/7883255.stm


" The governor of the Bank of England, Mervyn King, has warned that the UK is facing a deep recession in 2009 and said that further monetary action may be necessary. In its latest forecast for economic growth and inflation, the Bank says that the UK economy will decline sharply in the first half of the year. "

"And it says that there is a significant risk that the recession will be even longer and deeper than expected."




Longer and deeper than which of the predictions...???

60 years, 100 years; recovery in 3rd quarter 09, or sometime in 2010...?

Needs to be expanded upon, methinks.

luvpump

http://news.sky.com/skynews/Home/Business/Recession-Bank-Of-England-Says-Inflation-Will-Fall-To-05-Percent-In-Two-Years/Article/200902215220812?lpos=Business_Carousel_Region_0&lid=ARTICLE_15220812_Recession%3A_Bank_Of_England_Says_Inflation_Will_Fall_To_0.5_Percent_In_Two_Years

4% !!.. Thats huge isn't it ? .. Or are they Just trying to prepare us all for Massive Money printing ??

"The Bank, which last week cut the interest rate to a new historic low of 1%, also gave its clearest signal yet that it would need to resort to unconventional measures to combat the downturn"
P.S sorry for the big link

fatpig_2

Laurel and Hardy could do a much better job of running the economy rather than King and Brown.

mbga9pgf

In its quarterly forecast, the Bank said the rate of contraction could reach as high as 6% by the middle of the year, compared to mid-2008.

Not good...

http://en.wikipedia.org/wiki/List_of_recessions_in_the_United_Kingdom

6.1% over 2 years for the 1981 recession which by all accounts was a real B8tch

1929 - where I think we may head....

1919-21 depression 1919-1921 ~3 years
-10.9% 1919
-6.0% 1920
-8.1% 1921[1]

We will see peak resets and thus writedowns towards the middle of next year and an end to writedowns in 2012... wich gives us 3 more years of this at least....

handful

Further evidence if it was needed that quantitive easing will commence probably after another 0.5% cut in IR in March. Rates have to be 0% - 0.5% for QE to commence, all that remains is for the decision to be taken as to how to inject this cash into the economy. Favourite seems to be by the buying of toxic debts with it but I prefer the 'dropping it out of a helicopter' method!

mbga9pgf

Buying toxic debt will be the least inflationary option in my opinion, and the one they go with. They should try to get the money back off the banks though in the long term, even if that takes 150 years!

halight

Soon be printing money by the skip load!!!!!!

Really2

mbga9pgf wrote: »

Buying toxic debt will be the least inflationary option in my opinion, and the one they go with. They should try to get the money back off the banks though in the long term, even if that takes 150 years!

Agree totaly, it takes the guess work out of how much to "print"

Wookster

Yup - bring on quantitative easing and destroy the savers who have been reponsible.

Thank you Crash, you've done another sterling job.

chucky

Wookster wrote: »

Yup - bring on quantitative easing and destroy the savers who have been reponsible.

Thank you Crash, you've done another sterling job.

it's time that you made a decision Wookster - keep on using savings as your investment tool and grumble along complaining or look at alternatives that will give you a better yield.

it's simple enough. just don't blame others for it.

Really2

Wookster wrote: »

Yup - bring on quantitative easing and destroy the savers who have been reponsible.

Thank you Crash, you've done another sterling job.

With A job paying a lot more than most people interest it is within the interest of all (yes even pensioners as they rely on benefits which could colapse if the economy did) to get out of this mess as quickly as possible.

Savers could easily ship their savings in to other assets (shares etc.)
But I do not see how in effect writting off bad debt will cause the much touted "Hyper-Inflation"