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Are we talking ourselves into another downturn?

As the chief executive of Unilever issues are very downbeat assessment of the global economy there are growing concerns that we are on the verge of talking ourselves into another downturn. Only a few weeks ago investors were happy to pour money into the UK stock market with high hopes that the economy had turned the corner and the global situation was recovering. However, only a few weeks down the line there are growing concerns of a double dip recession in the UK with the UK stock market having fallen 300 points since the turn of the year.

While you may think it impossible to talk ourselves into a recession, what would you do if you are looking to acquire property and the talk in the press was of a potential downturn? It is highly likely that you'd at least hold off on any potential property acquisition in the short term and if this were replicated by other potential buyers then the property market would struggle. A downturn in property prices would place pressure on mortgage payments, a potential increase in bad debts for UK banks and squeeze liquidity in the UK yet again.

This would just be the first phase of a potential double dip recession although whether UK consumers and UK businesses are on the verge of a self-fulfilling prophecy remains to be seen.

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