MSE News: Construction drop means UK back in recession

andy_allblack

Please can someone explain this to me, if one of the reasons the UK econcomy is struggling, because of the difficulties of the Eurozone, I think 40 per cent of our exports go to Europe, why can't we look at other markets, such as China, India, Brazil, instead? Why are we relying on Europe so much for our trade? Is it too difficult to switch trading partners?

gadgetmind

andy_allblack wrote: »

Please can someone explain this to me, if one of the reasons the UK econcomy is struggling, because of the difficulties of the Eurozone,

That's a bit of a simplification. What's currently holding things back is fear. Many companies have been doing a splendid job of de-leveraging, are now fairly cash rich, and have been increasing dividends. However, what they haven't been doing (with a few notable exceptions) is investing their cash via expansion and acquisition.

Why are we relying on Europe so much for our trade? Is it too difficult to switch trading partners?

Yes, it can be as dislodging the current incumbents who are servicing those markets isn't easy. However, some companies are doing a good job regards expanding globally and that's therefore been where I've been investing during the recent sticky patch.

However, I've always been a bit of a global person. I've been in business for 30 years and have never regarded the UK (or even Europe!) as being worthy of more of my attention than their TAM (Total Addressable Market) justifies.

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

andy_allblack

gadgetmind wrote: »

That's a bit of a simplification. What's currently holding things back is fear. Many companies have been doing a splendid job of de-leveraging, are now fairly cash rich, and have been increasing dividends. However, what they haven't been doing (with a few notable exceptions) is investing their cash via expansion and acquisition.



Yes, it can be as dislodging the current incumbents who are servicing those markets isn't easy. However, some companies are doing a good job regards expanding globally and that's therefore been where I've been investing during the recent sticky patch.

However, I've always been a bit of a global person. I've been in business for 30 years and have never regarded the UK (or even Europe!) as being worthy of more of my attention than their TAM (Total Addressable Market) justifies.

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

gadgetmind, many thanks for trying to explain my question, I do find it hard to understand what's going in the economy. I've tried reading newspapers and watching news on TV. Once again thanks very much.

gadgetmind

andy_allblack wrote: »

gadetmind, many thanks for trying to explain my question, I do find it hard to understand what's going in the economy. I've tried reading newspapers and watching news on TV. Once again thanks very much.

As it happens, very few people actually trust the latest figures and both industry and the markets very much doubt that we are in recession.

As for reading the newspapers, they just love doom and gloom, and the TV gives a "Fisher Price" sheen of dumb to everything, so they are both best ignored.

Dave_save

andy_allblack wrote: »

gadgetmind, many thanks for trying to explain my question, I do find it hard to understand what's going in the economy. I've tried reading newspapers and watching news on TV. Once again thanks very much.

You sure you aren't really George Osborne in disguise? That's the kind of statement he might make!

jbarnett

Did we ever get out of recession? As far as I can tell we never really left... ok - so "technically" we did leave recession at some point in 2010 but it's not as though anyone would really notice... inflation was still sky-high (and growing), VAT rates are ridiculous, cost of car insurance on the increase, etc, etc, etc...

gadgetmind

jbarnett wrote: »

Did we ever get out of recession?

The prevailing view seems to be that the GDP figures are bogus and that we aren't really back in recession. A lot of indicators are actually turning pretty positive, particularly in the US, and China is more than likely to be slowly following.