Economic growth picks up - 0.5%

shortchanged_2

Expect to see the figures revised downwards over the next few weeks.

Load of spin and guff.

tomterm8

Really2 wrote: »

Was that not down to the falling deficit (1994 onwards) they received when coming in to power.

It takes time to turn a tanker.

I don't think anyone thinks you go from big deficit to surplus over night.

To do that would take crippling cuts.

Most of it comes from increased taxes (they put in a lot of stealth tax rises). Some of it was just structural (they were in a boom before the 2001 minor recession). Labour had started to increase the size of the state.

I'm not saying the Labour party between 1997 and 2001 were upright citizens, I am saying they weren't practicing austerity. That cutting the deficit, on its own, isn't an austerity policy... you need to cut actual government spending.

As far as I can see, the bulk of the deficit improvement has been achieved by increasing taxes, not austerity (which is increasing taxes AND cutting spending in real terms).

shortchanged_2

Well with growth figures like that it may be time for the credit card to come back out of the wallet and to start hammering that limit again.

Really2

tomterm8 wrote: »

As far as I can see, the bulk of the deficit improvement has been achieved by increasing taxes, not austerity (which is increasing taxes AND cutting spending in real terms).

Maybe, but the public sector has been cutting jobs that is for sure.

Local authorities have led the way in shedding posts, accounting for 145,000 out of the 240,000 roles lost in the year to the end of June 2011. Central government made 66,000 positions redundant during this period, while a further 29,000 went in public bodies such as the BBC and the Post Office.

But obviously there is an imediate cost increase (redundancy pay) before the savings are felt ongoing.

Rinoa

Well, 0.5% is above expectations. So it can't be that bad. On a side note, imagine the scene in Ed Balls office as 9.30 approached.

Sat with his eyes glued to the screen. 9.27, 9.28, willl it be 0.3 as expected, please let it be 0.2 or even 0.1, interviews already scheduled with BBC and Sky, 9.29, 9.30.... over to the ONS who announce - a 0.5% increase. Doh! :doh:

Ed Balls slumps in his chair, his face anguished as he utters a string of expletives. :mad: :mad: :mad:

:rotfl:

julieq

The deficit is the difference between spending and receipts. It can go down when spending increases, if tax receipts rise, which they will do if there is growth.

We're not seeing austerity really, we're seeing some level of cuts in spending, most of which will take time to run through the system and materialise anyway and won't be quite as devastating as some believe. Greece are seeing austerity.

HAMISH_MCTAVISH

doire wrote: »

From Howard Archer, IHS Global Insight:

You should have seen the unedited version.....;)

From Howard Archer, IHS Global Insight:

On the face of it GDP growth of 0.5% in the third quarter looks a reasonable performance. However, this undoubtedly makes me look like a bit of a twit for constantly overplaying the downside risks to the economy.

Now, what can I use as an excuse??? Ah, yes....

It is evident that there was some boost to growth in the third quarter from the making up of activity that was lost to a number of “one-off” disruptive factors in the second quarter (working day lost to Royal Wedding, manufacturing supply-chain disruptions resulting from the Japanese tsunami, money spent on Olympic ticket sales but not yet counting towards growth etc).

But as I didn't previously mention these growth boosting activities would occur, instead preferring to gloat over the low numbers at the time in a maniacal impersonation of Dr Doom, I'd better change the topic quickly.

Most recent data and survey evidence portray an economy that is struggling hugely, and it looks to be in serious danger of stagnating or even worse in the fourth quarter, as is highlighted by manufacturing activity contracting in October at the fastest rate since mid-2009.

Now please, please, please can you all believe me and panic yourselves into another recession or I'm out of a job for getting it so spectacularly wrong for the last 3 years.

globalds

How does inflation affect this figure.

Does high inflation cancel out a 0.5% growth or does it make this figure all the more impressive ?

Masomnia

globalds wrote: »

How does inflation affect this figure.

Does high inflation cancel out a 0.5% growth or does it make this figure all the more impressive ?

The figures are adjusted for inflation, so more impressive I suppose!

competitionscafe