Recession to end in June 2009: Official

So the Chancellor thinks that reducing the standard rate of VAT to 15%, and increasing government spending, will stimulate demand to the extent that the economy will be boosted out of recession in a few months time.

The idea of course is that we all see that the price of a new car has been reduced by £250 so we will all go and buy one.

Personally I think that if you are concerned about your business failing or being made redundant from a job, that you will not be increasing debt just because you can “save” £250 if you buy a new car before the end of 2009.

What will happen is that you will be saving that money, or using it to pay off your credit card debts if the worst happens to you and you lose your income.

“Extraordinary times require extraordinary measures” the Prime Minister told the CBI. With such comments being made, confidence in the economy will not be improved.

Remember that the Chancellor in March this year said that growth would be 1.5 - 2.5% this year, now he informs us that growth will actually be 0.5%. This just shows that they did not have their finger on the pulse, so why should we trust their prediction?

If the government think that the economy will start to grow in 7 months time, it will be the biggest misjudgement since they claimed the end of boom and bust economics.

Or it is more to do with talking up the economy (pending a snap election next year) before we realise the truth?

This entry was posted on 24/11/2008 at 05:51 pm and is filed under The Economy, General. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response or trackback from your own site.