Are we poised is to see the third leg of the credit crunch crisis?
After the initial credit crunch hit the US and began to spread around the world there was a period when many observers believed concerns had been overdone and the markets and economies around the world would return to "normal". However, we then saw a second leg which impacted upon the worldwide financial sector, stock markets, government budgets and other vital elements of "everyday life". However, there are growing concerns that we could be poised to see the third leg of the credit crunch hit the worldwide economy!
Earlier this week we saw concerns appear regarding the Greek economy, which has struggled due to the downturn, with a massive increase in the Greek government budget deficit. There is also the ongoing situation in Dubai which, despite government claims that it is "under control", still has some way to go before it is totally resolved. As a consequence, there is growing fear in the money markets that more governments around the world will struggle to raise funds needed to see them through the short to medium term, a time when the worldwide economy and local economies should start to turn the corner.
The danger is that if economies are starved of potential financial investment in the short term we could see a sharp U-turn and a further lurch downwards. This could literally push the worldwide economy into a depression, never mind a recession!
UK government questions foreign takeovers
When Lord Mandelson suggested that he was concerned about the number of UK companies being taken over by foreign predators many people had to look again because he has been one of the strongest supporters of an open market. Whether or not Lord Mandelson has "changed his spots" overnight is open to debate as the government appears ready to do anything to curry favour with UK businesses and UK voter...Read More
David Cameron could scrap 50p top tax rate
David Cameron has taken a chance with UK voters by suggesting he would look to reverse the UK government's 50p top tax rate if it were shown to raise no money. While his comments have been applauded by Conservative supporters to the right of the party, there is no doubt that the Labour Party will use this to confirm that the Conservatives will look to reduce the tax burden for higher earners in th...Read More
Royal Bank of Scotland plans return for UK taxpayer investment
Stephen Hester, the chief executive of the Royal Bank of Scotland, has promised UK taxpayers a return on their investment in the medium term. This comes despite the fact that bad debts have ballooned at the majority state-owned banking group and the company has again been forced to take further finance from the UK government. So what next for the Royal Bank of Scotland?
Treasury remains upbeat despite GDP figures
The UK Treasury Department has remained fairly beat, citing expectations that the UK economy will rebound in the second half of 2009, despite greatly disappointing GDP figures this week. The fall of 0.8% in the economy in the second quarter of 2009 was significantly greater than the 0.3% forecast by many analysts although the Treasury had actually forecast a reduction of around 1%. Why this reduct...Read More
Is quantitative easing just around the corner?
Mervyn King, the Gov of the Bank of England, has this weekend suggested that the "printing of extra money" in the UK is just around the corner. Commonly known as "quantitative easing", in simple terms this allows the UK authorities to print as much new money as they require in order to try and stimulate the UK economy into life. This type of economic strategy only ever comes into play when nationa...Read More