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Britons face rising price pain

Fiona Shaikh is Reuters’ Economic Correspondent, based in London. –

BRITAIN/Stubbornly high inflation has proved something of an inconvenience for the Bank of England over the last year, but the unrelenting rise in prices is turning out to be a real headache for ordinary Britons — one which is likely to get worse before it gets any better.

Consumer price inflation — the headline measure targeted by the central bank — accelerated to 4 percent last month, the  highest in more than two years and double the BoE’s target.

A great deal of the rise will have been down to the 2-1/2 percentage point rise in value added tax at the start of this year — a one-off move that will drop out of the statistics next year and mechanically bring headline inflation back down again.

from Commentaries:

Turner is right to take on swollen banks

So the watchdog can bark after all. Adair Turner, chairman of Britain's Financial Services Authority, says the financial sector has "swollen beyond its socially useful size". That is a striking statement for any financial regulator, particularly one that counts promoting London's financial centre as one of its goals. Identifying the problem, however, is the easy bit. Reversing decades of financial expansion will require global agreement on tough new rules, and the determination to make sure they are consistently enforced.

Turner's comments, in a debate hosted by Prospect magazine, underscore the extent to which the crisis has upended the received wisdom among policymakers. For years they assumed markets were self-correcting, that financial innovation brought lasting economic benefits, and that regulators should think twice before getting in the way.

Banks score own goal with bonus culture defence

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In the blink of an eye it look as if the City is “booming” again after Barclays and HSBC announced buoyant investment banking earnings on Monday.

Both banks were hit by a surge in bad debts as the recession took its toll on borrowers, but analysts said that resurgent debt and foreign exchange trading and market share grabbed from troubled rivals fuelled the largely positive results.

What should be done about ex-RBS chief’s pension pot?

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Former Royal Bank of Scotland Chief Executive Fred Goodwin is not having a good year.

Earlier this month he was hauled before parliament to explain his part in how RBS, the company he led for nine years, came close to the brink of collapse.

Bankers offer act of contrition

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In the Middle Ages the four ousted British bankers who brought the Royal Bank of Scotland and HBOS to the brink of collapse would have probably had to endure the public humiliation of sitting in the stocks. 

On Tuesday the likes of former RBS chairman Tom McKillop and  former RBS chief executive Fred Goodwin had to undergo a more civilised form of public humiliation – a grilling by Parliament’s Treasury committee.

from Global Investing:

On Bankers and Busing

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Bankers are having a rough time of it lately.  It is not just that their companies are collapsing beneath them and their bonuses are the subject of global hate and derision. They also have to put up with the barbs of journalists (who are very familiar with being at the bottom of the popularity pile).

The latest example comes from Tim Dowling, scribbling away for Britain's Guardian newspaper.  Mr Dowling has penned a useful primer for bankers who suddenly find themselves living in the real world.

Job crunch Britain: how have you been affected?

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Net job creation in the UK has almost stopped as employers feel pessimistic about prospects for the economy, the latest quarterly Labour Market Outlook survey by KPMG and the Chartered Institute of Personnel and Development (CIPD) has found.

The balance between the proportion of employers looking to increase staff levels over the next three months and those expecting to cut has fallen from +41 in autumn 2007 to +2 in autumn 2008 – the lowest figure recorded since the survey began in spring 2004, according to the Payroll and Human Resources Newsletter.

Of the 721 employers surveyed, 83 per cent anticipated that Britain’s economic condition would further deteriorate this autumn and only one percent said they thought there would be an improvement.Respondents felt more optimistic about their own organisation though, with only 25 per cent believing that things would get worse.

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