UK News

Insights from the UK and beyond

from MacroScope:

UK heading for second downturn?

MacroScope is pleased to post the following from guest blogger Julian Chillingworth. Chillingworth is chief investment officer of UK investor Rathbones. He questions here whether Britain will face a second downturn shortly after struggling out of recession.

Are we likely to witness a two-tier recession in the UK?  Perhaps not a recession but certainly a secondary downturn. A vast number of people have enjoyed lower mortgage payments and a level of job security, but will this last?

The UK is in somewhat of a unique position in so far as it faces a regime change, with some obvious ramifications for policy.  However, whoever takes the seat (most likely the Tories) must still cut back public expenditure and raise taxation, both within the context of high unemployment.

It will require the wisdom of Solomon as a further rise in unemployment hits tax-take and results in rising social security payments. Who would want to be George Osborne?!

from MacroScope:

What me, British economist?

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Time was when a British education had a cachet, especially among Britain's far-flung colonial territories.

But could the prestige of even a Cambridge or Oxford degree be a little dulled in these parlous days for the British economy, now labouring under massive public debt and a decade-high unemployment rate?

Is Britain paying too high a price in Afghanistan?

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The death toll among British troops in Afghanistan is rising fast.  The soldier who died on Tuesday was the seventh to die in the last week and the 176th since the war began.

Last Wednesday, Lieutenant Colonel Rupert Thorneloe became the highest ranking British soldier to die in the conflict in Afghanistan when he was killed in Helmand. British commanders are quoted as saying things are going to get worse before they get better.

from MacroScope:

Crisis, what crisis, time again in Britain

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Britain's recession, like the downturns in most other places, is being hailed as either having reachえd bottom or tailed off in its decline. The latest to trumpet the beginning of the end is the British Chambers of Commerce, which said business orders and sales had continued to fall in the second quarter but at a slower pace than previously.

So does this mean that the Bank of England will soon start raising interest rates from the negligible 0.5 percent reached last year as policymakers sought to pump liquidity into a failing economy? Not according to researchers Capital Economics, which argues in a new report that market assumptions of higher rates at an early stage are misplaced. They offer three reasons:

from Global News Journal:

Germany’s Finance Minister takes aim at the City

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Has German Finance Minister Peer Steinbrueck finally said what many world leaders think but are afraid to say? That the British government won't sign up to meaningful reform of financial markets because it is too worried about what it would mean for the country’s most famous cash cow, the City of London.

 

The City, which accounts for around 35 percent of global foreign exchange turnover, has been a popular target for critics of capitalism for years. But it has rarely been singled out so bluntly as a problem by one of Britain’s close allies.

MPs shoot themselves in foot over expenses

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The online release of MPs’ expense claims has only served to further dent their already battered reputation.

Forty-two days after the Daily Telegraph began to investigate MPs’ expenses the Houses of Parliament finally got round to publishing official details of them. Or rather it didn’t, as lots of key information was blacked out.

Is powerful Mandy talking up the euro?

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When Prime Minister Gordon Brown reshuffled his cabinet last week, fending off a challenge to his authority, a significant outcome was the creation of one of the most powerful ministerial jobs Britain has seen in years.

 

Peter Mandelson, a former European commissioner who has twice served in British governments in the past and twice been forced to resign, was reconfirmed as secretary of state for business, but also given greatly expanded authorities that make him a powerful if unofficial number two to Brown.

Is Britain being too slow in promoting broadband?

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A new report from Ofcom, reveals that more than 30 percent of homes in Britain don’t have basic broadband service.

The study will become part of the government’s Digital Britain report, which is intended to help keep the UK economically and culturally competitive by promoting broadband access.

Time for the people to decide on Britain’s democratic future?

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Britain’s embattled political class are falling over themselves to modernise parliament, but given we have fully embraced the Internet age the proposals have a rather tame feel about them.

Gordon Brown’s latest proposals for “democratic renewal” — the reform of MPs expenses and an elected House of Lords to name but two — could hardly be described as Parliament 2.0.

Celebrities fill void of confidence in British politics

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These days in Britain, it’s no honour to be a Member of Parliament.

Begrimed by the scandal over their petty expense claims, MPs have fallen so low in the public’s esteem as to displace even bankers and journalists from their usual ranking as the dregs of society.

No wonder. The litany of petty claims revealed by a national paper ranges from the comical — charging a parliamentary expense account for viewing pornographic movies — to the frankly injurious, in the case of MPs who hoarded receipts for garden ornaments to beautify their second homes.

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