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!
Chinese economic slowdown threat to worldwide revival
Despite the fact that the Chinese economy has shown signs of revival over the last few weeks there is growing concern that an economic slowdown could just around the corner and could potentially unravel the worldwide recovery currently underway. The World Economic Forum believes that there is a 20% chance of a serious economic slowdown in China in the short to medium term which could lead to econo...Read More
Japan announces shock return to deflation
Even though the Japanese economy has been affected by deflation since the late 80s, many had assumed that the recent pull away from recession would kill the monster of deflation once and for all. However, the Japanese authorities have today confirmed that the Japanese economy is now in a mild deflationary period for the first time since 2006. Even though the situation is described as "mild" there...Read More
Airline industry to benefit from British Airways woes
Even though the British Airways cabin crew strike was only announced yesterday, we have seen a significant increase in the cost of Christmas airfares with each and every airline company desperate to bring in as much income as possible during these difficult times. In what is simply becoming a case of supply versus demand, we have seen the cost of a travel over the Christmas period, when the Britis...Read More
Public sector wages increased by up to 20%
There is dismay in the private sector today with news that the public sector wage bill has seen a massive rise over the last 12 months. Figures released by the Office for National Statistics show that senior council workers have seen their salaries increase by up to 20% over the last 12 months while public service administrative professionals have seen their income increased by just over 10%. This...Read More
UK banks still short of capital
In a disappointing move for the UK banking sector and the UK government, the Bank of England still believes that many UK banks are still short of capital adequacy. This is despite the fact that billions upon billions of pounds of taxpayer's money has been poured into the sector, with little return as yet. So what exactly is going on?
While it would be wrong to suggest that the UK ba...