The R word

Filo25

michaels wrote: »

I am hoping it is just that asos had been doing so well that they and the markets had got a bit ahead of themselves as online competitors have upped their game - not sure it feels like that though....

The update to the student loan accounting while making no real difference to public finances certainly makes the deficit look bigger by 12bn increasing to 17bn pa which is huge.

I have a suspicion that UC may make any downturn cheaper for the public purse at least in the short term as those with assets are able to claim pretty much zilch but also reduces those 'automatic stabilisers' we learned about in 1st year economics.

My concern is as much political as economic in the UK, the last 10 years have been pretty hard on a lot of groups in the UK, if we see a downturn and resumption of the squeeze on public spending, squeezed real wages, and all of those other lovely impacts of recession, I'm not sure how ready we are to deal with that as a nation, especially when you have so much division and so many "easy" populist solutions from the left and right at present.

I can't see many people being too happy with the UC system if we saw a spike in unemployment and more people depending on it, but I do take your point that it probably slightly mitigates the public finance impact.

Thrugelmir

michaels wrote: »

Seems the financial news is moving my way, I still think we will see negative growth in q4 and q1 19 unless a brexit deal is done early in the new year and then what happens depends on whether there is a brexit deal.

The UK is highly dependent on the retail sector. Strip that out and growth is always sluggish in the period. Hardly surprising either given that for many it's now an extended holiday. Used to be just the bank holidays that were non working days. Nor was the 1st Jan a day off either.

Gwendo40

Filo25 wrote: »

Monetary policy wise obviously we can't cut rates nearly as much as we did last time around as they are still close to all time lows, obviously can start up the QE programme again, but not as effective as hefty rate cuts at boosting hte real economy.
.

Who cares about boosting the ''real economy''... as long as the QE props up and further inflates house prices that's all that matters, right?

Filo25

Gwendo40 wrote: »

Who cares about boosting the ''real economy''... as long as the QE props up and further inflates house prices that's all that matters, right?

Not many other tools left in the government locker though.

Yes it does boost asset prices, but keeps the costs of servicing the national debt down by reducing bond yields, also helps to keep credit from being squeezed too tightly for our rather heavily indebted consumers.

kabayiri

On a personal level, we were looking at acquiring an additional property, but it might be worth waiting a short while, to try and pick something up a bit cheaper. I don't see much upside to property prices with a gloomy outlook.

In Canada you can track/link the property price changes much more clearly to the economy IMO. We dropped $300K off one place to sell.

Thrugelmir

Gwendo40 wrote: »

Who cares about boosting the ''real economy''... as long as the QE props up and further inflates house prices that's all that matters, right?

QE has ended with the exception of Japan. Interesting times lie ahead.

michaels

More 'headwinds'
https://www.bbc.co.uk/news/business-46734933

The EU is interesting as the QE tap has only just been switched off but the economy is already looking 'weak'....

China also, do recent data points on things like car registrations suggest a rapid deceleration?

Thrugelmir

michaels wrote: »

The EU is interesting as the QE tap has only just been switched off but the economy is already looking 'weak'....

The EU as a whole hides a multitude of sins. With Germany and France looking to slow markedly , there's a big impact on the rest of the EU.

michaels

Looks like Germany may well be in recession:

https://www.businessinsider.com/germany-just-went-into-a-recession-2019-1?r=US&IR=T

Now where did I hear that predicted first?!

Thrugelmir

UK must be tettering towards the edge as well. Following today's poor business news.