UK 'double dip' recession expected by most finance directors

vivatifosi

Not good news. Will lead to lower business investment and fewer hiring. Figure for finance directors expecting a double dip has risen to 50%, double the number a year ago. Priorities for companies will now be reducing costs and increasing cash flow. Availability of credit also a problem.

http://www.telegraph.co.uk/finance/economics/8988065/UK-double-dip-recession-expected-by-most-finance-directors.html

Generali

vivatifosi wrote: »

Not good news. Will lead to lower business investment and fewer hiring. Figure for finance directors expecting a double dip has risen to 50%, double the number a year ago. Priorities for companies will now be reducing costs and increasing cash flow. Availability of credit also a problem.

http://www.telegraph.co.uk/finance/economics/8988065/UK-double-dip-recession-expected-by-most-finance-directors.html

It's always going to be tough if your biggest buyers are going bust and your home Government has to up taxes in your domestic market.

stonethrower

Just out of curiosity what time gap has there to be between recessions, before the second recession is not called a double dip recession.

Generali

stonethrower wrote: »

Just out of curiosity what time gap has there to be between recessions, before the second recession is not called a double dip recession.

There is no formal definition AFAIK. A recession is 2 consecutive quarters of negative real GDP 'growth'.

Kennyboy66

stonethrower wrote: »

Just out of curiosity what time gap has there to be between recessions, before the second recession is not called a double dip recession.

Effectively only 3 months, so 2 quarters of contraction followed by 1 of expansion, then another 2 or contraction would qualify as a double dip.

The last one in the UK was 1974.

Wookster

Not surprising that Finance Directors are predicting gloom, they are often fairly risk averse/ somewhat bearish by nature.

Facts on the ground don't look too good, Europe is slowing very fast, and furthermore, the currency (which accounts for about 25% of global reserves) looks like it could go pop.

Not exactly conditions that bode well for taking risks.

StevieJ

Kennyboy66 wrote: »

Effectively only 3 months, so 2 quarters of contraction followed by 1 of expansion, then another 2 or contraction would qualify as a double dip.

The last one in the UK was 1974.

I thought he was asking after what gap a recession would be a new recession rather than a double dip?

Thrugelmir

Wookster wrote: »

Not surprising that Finance Directors are predicting gloom, they are often fairly risk averse/ somewhat bearish by nature.

In my experience they are realists. When you are at the coal face of Company finance you see the whole picture very clearly.

julieq

To be fair, it's an even split of opinion, not an overwhelming prediction one way or another. Having said that, I'd be with those expecting a second dip, but it's not a clear picture at all on the day job numbers.

If I were to put my betting hat on I'd be expecting a technical recession fairly short in duration rather than a full blown crisis, but it certainly will complicate the eurozone bailout picture and our own deficit reduction, and I wouldn't expect a lot of hiring until the picture is clearer. What is slightly encouraging is slight signs of strength in the US now.

grizzly1911

Figures/definitions may say one thing but in reality we never came out of recession and it will be along time until we do.

Occasionally we may lift the nose to buy some more time.

The figures banded about by statisticians are too fine to call.

Gives the press and politicians something to fill airtime without tackling the real issues.

Generali

julieq wrote: »

What is slightly encouraging is slight signs of strength in the US now.

Very good manufacturing and construction data out of the the US yesterday. Hopefully that will continue.

Good manufacturing data reported by the Chinese (yeah I know) and Europe. It's funny really, the real economy seems to be picking up steam, it's just the banks and the Governments that are in trouble!